derivative claim in California

2026(Id. at p. 1104.) In adopting this continuous membership requirement, the court reasoned: “Because a derivative claim does not belong to the stockholder asserting it, standing to maintain such a claim is justified only by the stockholder 22 relationship and the indirect benefits made possible thereby, which furnish the stockholder with an interest and incentive to seek redress for injury to the corporation. [Citations.] Once this relationship ceases to exist, the derivative plaintiff lacks standing because he or she ‘no longer has a financial interest in any recovery pursued for the benefit of

2023(See Grosset, supra, 42 Cal.4th at p. 1114 .) As we observed, “Because a derivative claim does not belong to the stockholder asserting it, standing to maintain such a claim is justified only by the stockholder relationship and the indirect benefits made possible thereby, which furnish the stockholder with an interest and incentive to seek redress for injury to the corporation.” (Ibid.) A stockholder who stops owning shares in the corporation “ ‘no longer has a financial trust certificates at the time of the transaction . . . . [¶] (2) The plaintiff alleges in the complaint with particularity p

2026(Schrage v. Schrage (2021) 69 Cal.App.5th 126 , 149; see Cotton v. Expo Power Systems, Inc. (2009) 170 Cal.App.4th 1371, 1380 [“A derivative claim is a property right that belongs to the corporation.”].) “The shareholders may, however, bring a derivative suit to enforce the corporation’s rights and redress its injuries when the board of directors fails or refuses to do so.

2021(See Cotton v. Expo Power Systems, Inc., supra, 170 Cal.App.4th at p. 1380 [“A derivative claim is a property right that belongs to the corporation.”].) “The shareholders may, however, bring a derivative suit to enforce the corporation’s rights and redress its injuries when the board of directors fails or refuses to do so.

2020(Patrick v. Alacer Corp., supra, 167 Cal.App.4th at p. 1004 .) “ ‘The corporation has traditionally been aligned as a defendant because it is in conflict with its stockholder over the advisability of bringing suit....’ [Citation.] In a real sense, the only claim a shareholder plaintiff asserts against the nominal defendant corporation in a derivative action is the claim the corporation has failed to pursue the litigation.” (Ibid.) “[A] nominal defendant corporation generally may not defend a derivative action filed on its behalf.” (Id. at p. 1005.) While the corporation may assert defenses con

2017Alacer Corp . (2008) 167 Cal.App.4th 995 , 1005, 84 Cal.Rptr.3d 642 ( Patrick ).) But as Patrick makes clear, a board's ability to appoint a special litigation committee to investigate the merits of the derivative claim and potentially assert the special litigation committee defense does not alter or negate its right to contest the derivative plaintiff's standing in the first instance.

2021That is a derivative claim. “[W]here conduct, including mismanagement by corporate officers, causes damage to the corporation, it is the entity that must bring suit; the individual shareholder may not bring an action for indirect personal losses (i.e., decrease in stock value) sustained as a result of the overall harm to the entity.” (Bader v. Anderson, supra, 179 Cal.App.4th at p. 788 ; see Heshejin v. Rostami (2020) 54 Cal.App.5th 984 , 994, fn. 10 [“‘“a shareholder cannot bring a direct action for damages against management on the theory their alleged wrongdoing decreased the value of his o

2021That is a derivative claim. “[W]here conduct, including mismanagement by corporate officers, causes damage to the corporation, it is the entity that must bring suit; the individual shareholder may not bring an action for indirect personal losses (i.e., decrease in stock value) sustained as a result of the overall harm to the entity.” (Bader v. Anderson, supra, 179 Cal.App.4th at p. 788 ; see Heshejin v. Rostami (2020) 54 Cal.App.5th 984 , 994, fn. 10 [“‘“a shareholder cannot bring a direct action for damages against management on the theory their alleged wrongdoing decreased the value of his o

2023We have joined those courts “that have concluded the principles of due process do not require determination of a defendant’s present ability to pay before imposing the fines and assessments discussed in Dueñas.” (People v. Pack-Ramirez (2020) 56 Cal.App.5th 851 , 860, citing People v. Kingston (2019) 41 Cal.App.5th 272 , 279-282; People v. Hicks (2019) 40 Cal.App.5th 320 , 326-329, review granted Nov. 26, 2019, S258946; People v. Aviles (2019) 39 Cal.App.5th 1055 , 1068-1069; People v. Caceres (2019) 39 Cal.App.5th 917 , 928.) 8 Thus, we reject defendant’s Dueñas challenge to the above-referen

2021(People v. Kipp (1998) 18 Cal.4th 349, 377 [failure to assert a meritless defense does not demonstrate ineffective assistance of counsel].) To the extent imposing potentially unpayable fees or fines on indigent defendants raises constitutional concerns, we agree with the reasoning in People v. Kopp, 38 Cal.App.5th at pages 96-97 that such challenges are properly analyzed under the excessive fines clause, which limits the government’s power to extract payments as punishment for an offense.

2022(See Meister v. Mensinger (2014) 230 Cal.App.4th 381, 386-387 [direct claim by preferred shareholders for breach of fiduciary duty by company’s chief financial officer and chief executive officer arising from the company’s sale of assets and subsequent dissolution]; Jara v. Suprema Meats, Inc. (2004) 121 Cal.App.4th 1238, 1258-1259 [concluding claim that two majority shareholders paid themselves excessive salaries, resulting in a decreased dividend for the plaintiff shareholder, was not required to be pursued as a derivative claim].) 14 Li has also argued that Hollywood Garden had already file

2021(See Daly v. Yessne (2005) 131 Cal.App.4th 52, 63 ; Jara v. Suprema Meats, Inc. (2004) 121 Cal.App.4th 1238, 1252-1253, 1257-1258 (Jara); see also Sutter v. General Petroleum Corp. (1946) 28 Cal.2d 525, 530 [“a stockholder may sue as an individual where he is directly and individually injured although the corporation may also have a cause of action for the same wrong”]; Goles v. Sawhney (2016) 5 Cal.App.5th 1014, 1018, fn. 3 [“A single cause of action by a shareholder can give rise to derivative claims, individual claims, or both.”]; Denevi v. LGCC, 31 LLC (2004) 121 Cal.App.4th 1211, 1222 [sa

2025“An action is derivative if ‘“the gravamen of the complaint is injury to the corporation, or to the whole body of its stock or property without any severance of distribution among individual holders . . . .”’” (Schuster v. Gardner (2005) 127 Cal.App.4th 305, 313 .) For example, “Under California law, ‘a shareholder cannot bring a direct action for damages against management on the theory their alleged wrongdoing decreased the value of his or her stock (e.g., by reducing corporate assets and net worth).’” (Id. at p. 312.) At least with regard to some of the factual assertions at issue, plaintif

2016(See Schuster v. Gardner (2005) 127 Cal.App.4th 305, 312 .) Arguably, such a claim would need to be brought derivatively on behalf of the corporation, rather than as individual shareholder suits.

2026(Id. at p. 384.) However, we additionally held in Sirott, citing Grosset and Haro, that equitable considerations may excuse the continuous ownership requirement where “a plaintiff is being wrongfully deprived of, or not actually losing, its interest in the corporation.” (Sirott, supra, 78 Cal.App.5th at p. 385.) Standards of Review “A moving defendant establishes an entitlement to summary judgment by showing that the action is barred by a ‘ “complete defense” ’ [citation], or that ‘ “one or more elements of the cause of action . . . cannot be established” by the plaintiff.’ ” (Denevi v. LGCC,

2021(See Daly v. Yessne (2005) 131 Cal.App.4th 52, 63 ; Jara v. Suprema Meats, Inc. (2004) 121 Cal.App.4th 1238, 1252-1253, 1257-1258 (Jara); see also Sutter v. General Petroleum Corp. (1946) 28 Cal.2d 525, 530 [“a stockholder may sue as an individual where he is directly and individually injured although the corporation may also have a cause of action for the same wrong”]; Goles v. Sawhney (2016) 5 Cal.App.5th 1014, 1018, fn. 3 [“A single cause of action by a shareholder can give rise to derivative claims, individual claims, or both.”]; Denevi v. LGCC, 31 LLC (2004) 121 Cal.App.4th 1211, 1222 [sa

2023Hence, ‘the court must be apprised of facts specific to each director from which it can conclude that that particular director could or could not be expected to fairly evaluate the claims of the shareholder plaintiff.’” (Apple Inc. v. Superior Court, supra, 18 Cal.App.5th at p. 253 ; accord, Shields v. Singleton, supra, 15 Cal.App.4th at p. 1622 .) The third amended complaint contains no factual allegations of any sort regarding nondefendant directors of Pacifica other than the board member whose spouse was involved with the PSLL loan, let alone specific facts permitting the conclusion a major

2017Plaintiffs were "required to allege facts 'with particularity' ( § 800(b)(2) ) sufficient to 'create a reasonable doubt that, as of the time the complaint is filed, the board of directors could have properly exercised its independent and disinterested business judgment in responding to a demand.' " ( Bader , supra , 179 Cal.App.4th at p. 797 , 101 Cal.Rptr.3d 821 .) Broad or conclusory allegations are insufficient ( Shields , supra , 15 Cal.App.4th at p. 1621 , 19 Cal.Rptr.2d 459 ), as are "facts relating to the structural bias common to corporate boards ...." ( Oakland Raiders , supra , 93 Ca

2021F. Ahmanson & Co. (1969) 1 Cal.3d 93, 108 (Jones); accord, Sheley v. Harrop (2017) 9 Cal.App.5th 1147, 1171 ; see § 17704.09 [describing the fiduciary duties of members and managers of a limited liability company]; Feresi v. The Livery, LLC (2014) 232 Cal.App.4th 419, 425 [same]; Everest Investors 8 v. McNeil Partners (2003) 114 Cal.App.4th 411, 424-425 [describing the fiduciary obligations in a partnership].) A minority shareholder may bring a cause of action for breach of fiduciary duty against majority shareholders as an individual claim or as a derivative claim, depending on the circumstan

2021F. Ahmanson & Co. (1969) 1 Cal.3d 93, 108 (Jones); accord, Sheley v. Harrop (2017) 9 Cal.App.5th 1147, 1171 ; see § 17704.09 [describing the fiduciary duties of members and managers of a limited liability company]; Feresi v. The Livery, LLC (2014) 232 Cal.App.4th 419, 425 [same]; Everest Investors 8 v. McNeil Partners (2003) 114 Cal.App.4th 411, 424-425 [describing the fiduciary obligations in a partnership].) A minority shareholder may bring a cause of action for breach of fiduciary duty against majority shareholders as an individual claim or as a derivative claim, depending on the circumstan

2021That is a derivative claim. “[W]here conduct, including mismanagement by corporate officers, causes damage to the corporation, it is the entity that must bring suit; the individual shareholder may not bring an action for indirect personal losses (i.e., decrease in stock value) sustained as a result of the overall harm to the entity.” (Bader v. Anderson, supra, 179 Cal.App.4th at p. 788 ; see Heshejin v. Rostami (2020) 54 Cal.App.5th 984 , 994, fn. 10 [“‘“a shareholder cannot bring a direct action for damages against management on the theory their alleged wrongdoing decreased the value of his o

2021That is a derivative claim. “[W]here conduct, including mismanagement by corporate officers, causes damage to the corporation, it is the entity that must bring suit; the individual shareholder may not bring an action for indirect personal losses (i.e., decrease in stock value) sustained as a result of the overall harm to the entity.” (Bader v. Anderson, supra, 179 Cal.App.4th at p. 788 ; see Heshejin v. Rostami (2020) 54 Cal.App.5th 984 , 994, fn. 10 [“‘“a shareholder cannot bring a direct action for damages against management on the theory their alleged wrongdoing decreased the value of his o

2021(See Daly v. Yessne (2005) 131 Cal.App.4th 52, 63 ; Jara v. Suprema Meats, Inc. (2004) 121 Cal.App.4th 1238, 1252-1253, 1257-1258 (Jara); see also Sutter v. General Petroleum Corp. (1946) 28 Cal.2d 525, 530 [“a stockholder may sue as an individual where he is directly and individually injured although the corporation may also have a cause of action for the same wrong”]; Goles v. Sawhney (2016) 5 Cal.App.5th 1014, 1018, fn. 3 [“A single cause of action by a shareholder can give rise to derivative claims, individual claims, or both.”]; Denevi v. LGCC, 31 LLC (2004) 121 Cal.App.4th 1211, 1222 [sa

2021When a derivative suit is brought to litigate the rights of the corporation, the corporation is an indispensable party and must be joined as a nominal defendant.” (Grosset, supra, 42 Cal.4th at p. 1108 ; accord, Jones, supra, 1 Cal.3d at pp. 106-107; see Patrick v. Alacer Corp., supra, 167 Cal.App.4th at p. 1004 [“Though the corporation is essentially the plaintiff in a derivative action, ‘[w]hen a derivative suit is brought to litigate the rights of the corporation, the corporation . . . must be joined as a nominal defendant.’”].) “An action is deemed derivative ‘“if the gravamen of the compl

2021That is a derivative claim. “[W]here conduct, including mismanagement by corporate officers, causes damage to the corporation, it is the entity that must bring suit; the individual shareholder may not bring an action for indirect personal losses (i.e., decrease in stock value) sustained as a result of the overall harm to the entity.” (Bader v. Anderson, supra, 179 Cal.App.4th at p. 788 ; see Heshejin v. Rostami (2020) 54 Cal.App.5th 984 , 994, fn. 10 [“‘“a shareholder cannot bring a direct action for damages against management on the theory their alleged wrongdoing decreased the value of his o

2021That is a derivative claim. “[W]here conduct, including mismanagement by corporate officers, causes damage to the corporation, it is the entity that must bring suit; the individual shareholder may not bring an action for indirect personal losses (i.e., decrease in stock value) sustained as a result of the overall harm to the entity.” (Bader v. Anderson, supra, 179 Cal.App.4th at p. 788 ; see Heshejin v. Rostami (2020) 54 Cal.App.5th 984 , 994, fn. 10 [“‘“a shareholder cannot bring a direct action for damages against management on the theory their alleged wrongdoing decreased the value of his o

2021F. Ahmanson & Co. (1969) 1 Cal.3d 93, 108 (Jones); accord, Sheley v. Harrop (2017) 9 Cal.App.5th 1147, 1171 ; see § 17704.09 [describing the fiduciary duties of members and managers of a limited liability company]; Feresi v. The Livery, LLC (2014) 232 Cal.App.4th 419, 425 [same]; Everest Investors 8 v. McNeil Partners (2003) 114 Cal.App.4th 411, 424-425 [describing the fiduciary obligations in a partnership].) A minority shareholder may bring a cause of action for breach of fiduciary duty against majority shareholders as an individual claim or as a derivative claim, depending on the circumstan

2021F. Ahmanson & Co. (1969) 1 Cal.3d 93, 108 (Jones); accord, Sheley v. Harrop (2017) 9 Cal.App.5th 1147, 1171 ; see § 17704.09 [describing the fiduciary duties of members and managers of a limited liability company]; Feresi v. The Livery, LLC (2014) 232 Cal.App.4th 419, 425 [same]; Everest Investors 8 v. McNeil Partners (2003) 114 Cal.App.4th 411, 424-425 [describing the fiduciary obligations in a partnership].) A minority shareholder may bring a cause of action for breach of fiduciary duty against majority shareholders as an individual claim or as a derivative claim, depending on the circumstan

2021(See Daly v. Yessne (2005) 131 Cal.App.4th 52, 63 ; Jara v. Suprema Meats, Inc. (2004) 121 Cal.App.4th 1238, 1252-1253, 1257-1258 (Jara); see also Sutter v. General Petroleum Corp. (1946) 28 Cal.2d 525, 530 [“a stockholder may sue as an individual where he is directly and individually injured although the corporation may also have a cause of action for the same wrong”]; Goles v. Sawhney (2016) 5 Cal.App.5th 1014, 1018, fn. 3 [“A single cause of action by a shareholder can give rise to derivative claims, individual claims, or both.”]; Denevi v. LGCC, 31 LLC (2004) 121 Cal.App.4th 1211, 1222 [sa

2021(See Daly v. Yessne (2005) 131 Cal.App.4th 52, 63 ; Jara v. Suprema Meats, Inc. (2004) 121 Cal.App.4th 1238, 1252-1253, 1257-1258 (Jara); see also Sutter v. General Petroleum Corp. (1946) 28 Cal.2d 525, 530 [“a stockholder may sue as an individual where he is directly and individually injured although the corporation may also have a cause of action for the same wrong”]; Goles v. Sawhney (2016) 5 Cal.App.5th 1014, 1018, fn. 3 [“A single cause of action by a shareholder can give rise to derivative claims, individual claims, or both.”]; Denevi v. LGCC, 31 LLC (2004) 121 Cal.App.4th 1211, 1222 [sa

2021F. Ahmanson & Co. (1969) 1 Cal.3d 93, 108 (Jones); accord, Sheley v. Harrop (2017) 9 Cal.App.5th 1147, 1171 ; see § 17704.09 [describing the fiduciary duties of members and managers of a limited liability company]; Feresi v. The Livery, LLC (2014) 232 Cal.App.4th 419, 425 [same]; Everest Investors 8 v. McNeil Partners (2003) 114 Cal.App.4th 411, 424-425 [describing the fiduciary obligations in a partnership].) A minority shareholder may bring a cause of action for breach of fiduciary duty against majority shareholders as an individual claim or as a derivative claim, depending on the circumstan

2021F. Ahmanson & Co. (1969) 1 Cal.3d 93, 108 (Jones); accord, Sheley v. Harrop (2017) 9 Cal.App.5th 1147, 1171 ; see § 17704.09 [describing the fiduciary duties of members and managers of a limited liability company]; Feresi v. The Livery, LLC (2014) 232 Cal.App.4th 419, 425 [same]; Everest Investors 8 v. McNeil Partners (2003) 114 Cal.App.4th 411, 424-425 [describing the fiduciary obligations in a partnership].) A minority shareholder may bring a cause of action for breach of fiduciary duty against majority shareholders as an individual claim or as a derivative claim, depending on the circumstan

2021F. Ahmanson & Co. (1969) 1 Cal.3d 93, 108 (Jones); accord, Sheley v. Harrop (2017) 9 Cal.App.5th 1147, 1171 ; see § 17704.09 [describing the fiduciary duties of members and managers of a limited liability company]; Feresi v. The Livery, LLC (2014) 232 Cal.App.4th 419, 425 [same]; Everest Investors 8 v. McNeil Partners (2003) 114 Cal.App.4th 411, 424-425 [describing the fiduciary obligations in a partnership].) A minority shareholder may bring a cause of action for breach of fiduciary duty against majority shareholders as an individual claim or as a derivative claim, depending on the circumstan

2021F. Ahmanson & Co. (1969) 1 Cal.3d 93, 108 (Jones); accord, Sheley v. Harrop (2017) 9 Cal.App.5th 1147, 1171 ; see § 17704.09 [describing the fiduciary duties of members and managers of a limited liability company]; Feresi v. The Livery, LLC (2014) 232 Cal.App.4th 419, 425 [same]; Everest Investors 8 v. McNeil Partners (2003) 114 Cal.App.4th 411, 424-425 [describing the fiduciary obligations in a partnership].) A minority shareholder may bring a cause of action for breach of fiduciary duty against majority shareholders as an individual claim or as a derivative claim, depending on the circumstan

2024(See also Schrage v. Schrage (2021) 69 Cal.App.5th 126 , 153 [it is a derivative claim when the primary complaint is about squandered corporate assets]; Nelson v. Anderson (1999) 72 Cal.App.4th 111, 127 (Nelson) [when the corporation lost opportunities, the injury is to the whole body of stock and the action is derivative].) Tuli contests this analysis by citing two inapposite cases.

2021That is a derivative claim. “[W]here conduct, including mismanagement by corporate officers, causes damage to the corporation, it is the entity that must bring suit; the individual shareholder may not bring an action for indirect personal losses (i.e., decrease in stock value) sustained as a result of the overall harm to the entity.” (Bader v. Anderson, supra, 179 Cal.App.4th at p. 788 ; see Heshejin v. Rostami (2020) 54 Cal.App.5th 984 , 994, fn. 10 [“‘“a shareholder cannot bring a direct action for damages against management on the theory their alleged wrongdoing decreased the value of his o

2023(See Trujillo v. North County Transit Dist. (1998) 63 Cal.App.4th 280, 289 [“‘[T]here’s no logic that says an employee who has not been discriminated against can sue an employer for not preventing discrimination that didn’t happen, for not having a policy to prevent discrimination when no discrimination occurred . . . .”’]; cf. Dickson v. Burke Williams, Inc. (2015) 234 Cal.App.4th 1307, 1318 [“There cannot be a claim for failure to take reasonable steps necessary to prevent sex discrimination . . . if actionable sex discrimination has not been found.”].) Appellant’s claims for failure to prov

2023(Trujillo v. North County Transit Dist. (1998) 63 Cal.App.4th 280, 286 ; §12940, subd. (k).) It is, however, a derivative claim; a failure to prevent cause of action necessarily requires the underlying unlawful retaliatory conduct.

2023(See Trujillo v. North County Transit Dist. (1998) 63 Cal.App.4th 280, 289 [“‘[T]here’s no logic that says an employee who has not been discriminated against can sue an employer for not preventing discrimination that didn’t happen, for not having a policy to prevent discrimination when no discrimination occurred . . . .”’]; cf. Dickson v. Burke Williams, Inc. (2015) 234 Cal.App.4th 1307, 1318 [“There cannot be a claim for failure to take reasonable steps necessary to prevent sex discrimination . . . if actionable sex discrimination has not been found.”].) Appellant’s claims for failure to prov

2023(Dickson v. Burke Williams, Inc. (2015) 234 Cal.App.4th 1307, 1317-1318 .) Because we affirm the judgment in favor of the County on plaintiffs’ underlying causes of action for harassment, discrimination, and retaliation, we must affirm the judgment on their cause of action for failure to prevent harassment, discrimination, or retaliation.

2024(Apple Inc. v. Superior Court (2017) 18 Cal.App.5th 222, 232 .) The corporate principles governing derivative actions apply to limited liability companies.

2023(See Apple Inc. v. Superior Court, supra, 18 Cal.App.5th at p. 239 [“while the corporation cannot ‘challenge the merits of a derivative claim filed on its behalf and from which it stands to benefit,’ it ‘may assert defenses contesting the plaintiff’s right or decision to bring suit, such as asserting the shareholder plaintiff’s lack of standing’”].) 11 In their respondents’ brief Aaron and Steinberg state, “Appellants raised the pre-litigation notification requirements of 16 At the hearing on the demurrer to the third amended complaint, when the court raised the issue, counsel for the Turner p