Rubenstein v. Berch

The plaintiff sues herein (1) present and former directors of the bankrupt corporation, Henry Shultz, Inc., for unlawful diversion of its property and stock, and (2) the persons to whom the diversion is alleged to have been made, on the theory that the acts of the individual defendants were in fraud of the creditors of the bankrupt corporation.

*266In the complaint, in those allegations germane to the present inquiry, it is alleged in substance: The corporation was organized in 1930 by Henry Shultz. Of its 1,000 shares of stock, 990 were issued to Henry Shultz. Five shares were issued to each of…