Caulfield v. The Packer Group, Inc.

Plaintiffs filed shareholders' derivative action on behalf of 2 corporations against officers and directors of 1 corporation, alleging breach of fiduciary duties and seeking attorney's fees. Plaintiffs each have a direct conflict with their fellow shareholders in derivative suit, as they are acting in their individual cases to collect remaining assets of insolvent corporate Defendants at expense of shareholders in derivative.  Thus, court properly dismissed 3rd amended complaint. Defendants are required to notify other stockholders of record of dismissal, and of time to intervene. Court did not abuse its discretion in dismissing claim for breach of fiduciary duties against outside directors, as Plaintiffs did not allege that outside directors had knowledge of imminent harm. (HALL and DELORT, concurring.)