TAORMINA et al.
TAORMINA CORP. et al.
Stockholders' derivative action by Rosa Maggio Taormina, executrix under the last will and testament of Calogero Taormina, deceased, and Samuel Miles Fink, ancillary administrator of the estate of Calogero Taormina, deceased, against Taormina Corporation, and others. The defendants filed a motion to dismiss the complaint. The Court of Chancery in and for New Castle County, Wolcott, Chancellor, held that an action against corporation and individual defendants wherein plaintiffs asserted that individual defendants, who were officers and directors of corporation and who owned all stock of corporation except stock of plaintiffs' predecessor, used their fiduciary position to utilize corporate assets for their personal gain by depriving corporation of opportunity to continue in business and caused corporation to take a course of conduct resulting in personal gain and profit to individual defendants was a derivative action to enforce cause of action owned by corporation, as against contention that action was to redress a wrong done to an individual stockholder who must bring suit in his own name.
Order in accordance with opinion.
[32 Del.Ch. 20] Motion to dismiss the complaint on the grounds (1) that this court lacks jurisdiction of the subject matter for the failure to join an indispensable party-plaintiff, and (2) that the complaint fails to state a claim upon which relief can be granted because of the laches of the plaintiffs.
William S. Potter and James L. Latchum, of Southerland, Berl & Potter, Wilmington, for plaintiffs.
Josiah Marvel, Jr., of Logan, Marvel & Boggs, Wilmington, for defendants.
On a motion to dismiss, the facts alleged in the complaint are taken to be true. They are hereafter briefly stated:
[32 Del.Ch. 21] Taormina Corporation, a Delaware corporation, (hereinafter called the ‘ Corporation’ ) was organized in 1935 and carried on the business of canning foods. It conducted a profitable operation and built up widespread public good will for its products under various trade names and brands.
Calogero Taormina was a stockholder and active in the development of the Corporation. He was a naturalized citizen of the United States. In 1939, after a serious illness, he returned to Italy and was there at the outbreak of World War II. He died in Italy in 1946 without having returned to the United States. After his death, his Will, dated November 25, 1935 and executed in the State of Mississippi, was probated under the law of Italy and his widow, Rosa Maggio Taormina, duly appointed executrix. By his Will, he left all his property equally to his widow and son. He specifically referred to other provisions made by him in his lifetime for his daughter by a former marriage, Rosillo Compagno, and disinherited her from any interest in his estate.
Rosa Maggio Taormina, executrix, appointed Samuel Miles Fink her attorney-in-fact and, in 1950, he was appointed ancillary administrator in Delaware of the estate of Calogero Taormina.
At the time of his death, Calogero Taormina was the registered owner of 498 shares of stock of the Corporation, and had been a stockholder of the Corporation since October 1, 1935 continuously to the time of his death.
On April 1, 1944, the individual defendants owning all the stock of the Corporation with the exception of the shares registered in the name of Calogero Taormina
formed a copartnership under the firm name of Taormina Company (hereinafter referred to as the ‘ Company’ ) in which each of the individual defendants owned an interest proportionate to his or her stock ownership in the Corporation. The Company thereafter engaged in the food ...