Rules you can apply without really Reading the Facts

Question 1

What procedural steps must be taken in order to perfect the right to sue?

Derivative suit (shareholder)

Actual CORPS question on VA Bar

Answer 1

(1) Standing requirement and (2) demand

(1) To have standing to bring a derivative suit, the shareholder must have owned stock at the time of the alleged wrongdoing and must fairly and adequately represent the interests of the corp.

(2) The shareholder must make a written demand on the corp prior to bringing suit.

After making demand, the shareholder must wait until the demand is rejected or until 90 days pass, unless he or she can show irreparable harm/injuy to the corp. If the demand is rejected, the shareholder may file the suit only if he or she alleges that the demand was not properly rejected by a disinterested decision maker.