Cornell v. Sims

As a general proposition, stockholders in a corporation can, not in their own names institute an action against it, nor defend one brought against it, until a request from them to the directors to institute or defend such action has been made and refused, which fact must be alleged in either instance. Such allegation, however, may be omitted when the corporate management is under the control of parties who, it is alleged, are guilty of fraud or collusive conduct in refusing to bring or to defend the suit which such stockholders desire shall be instituted or defended. But in neither of these…