Scanlon v. Eisenberg

Dist. Ct. erred in dismissing for lack of standing lawsuit filed by plaintiff-discretionary beneficiary of certain Trusts, alleging that defendants-Trustee of said Trusts and others breached fiduciary duty owed to plaintiff and other contingent beneficiaries when defendants purchased stock on behalf of Trusts that resulted in over $200 million in losses to said Trusts where, according to plaintiff, said purchase was done to advance defendants’ financial interests. While Dist. Ct. held that plaintiff lacked standing because she could not show likelihood that corpus of Trusts would be insufficient to pay discretionary distributions of trust assets to plaintiff during her lifetime, plaintiff acquired right to bring action for breach of fiduciary duty by virtue of defendants’ relationship to plaintiff, and plaintiff otherwise had cognizable interest in prudent and loyal administration of Trusts. Fact that plaintiff’s interest in Trusts’ assets might not rise to level of property interest was irrelevant.