Schneider v. Greater M. & S. Circuit, Inc.

The plaintiffs, as minority stockholders of the Greater M. & S. Circuit, Inc., a Delaware holding company, sue primarily to void as ultra vires contracts between the parent’s direct and indirect New York subsidiaries and defendant Sherman. Though the attack aims at several agreements, since what affects one applies to all, the agreements will be treated as one.

The holding company represents the 1928 merger of two competing chains of motion picture theatres. It owns no substantial assets other than the stock of its subsidiaries. The assets of the subsidiaries consist, directly and indirectly,…