Amarin Corp Plc (AMRN)

[eightisenough]

marj: "Shareholders Do Not Have Standing To Bring an
Individual Action Against Third Parties Who Have
Damaged the Corporation".

Apart from the context of a derivative action, can a shareholder in a corporation sue individually for wrongful acts committed against the corporation by third parties? The general rule of corporate law states that a shareholder cannot attain standing for such a suit.' This rule is grounded on the theory that
all shareholders should incur loss from third party wrongdoing in proportion to the amount of shares he or she holds, and likewise should proportionately benefit when the corporate entity wins an action.2 In addition, courts are fearful that if this rule were not in force, then there would be a multiplicity of individual shareholder suits.' (reasoning applies to fraud as well)

This applies even in cases of fraud:

Adair v. Wozniak, 23 Ohio St. 3d 174, 492 N.E.2d 426 (1986). As a result of the bankruptcy, plaintiffs brought an action alleging that the defendants had:

***conspired to defraud the corporation of its personal property. The Summit County Court of Common Pleas found that the plaintiffs did not have standing to sue individually and granted the defendants' motions for summary judgment.***

The lack of privity with the third party wrongdoer was the reason the Adair majority did not grant standing to the plaintiffs. The facts revealed that all the plaintiffs, except Mr. Houk, had guaranteed loans to the corporation at one time or another." These loans were separate from the transactions between the defendants and the corporation.52 Thus, when the corporation went bankrupt, the plaintiffs lost money on their loans, but the majority found that "... the injuries allegedly suffered by plaintiffs are not based on any independent contractual relationship plaintiffs had with defendants."

link: https://ideaexchange.uakron.edu/cgi/viewcontent.cgi?referer=&httpsredir=1&article=1740&context=akronlawreview