Gluck v. Rosenstiel

Order and judgment granting defendants-respondents summary judgment pursuant to CPLR 3212, in stockholders’ derivative action, unanimously reversed on the law, with $50 costs and disbursements to abide the event, the judgment vacated and motion for summary judgment denied, without prejudice, however, to renewal of the motion on fuller papers or following examination before trial of defendants-respondents, if such examinations should be obtained. Significant although it may be that the corporate tender for purchase of the corporation’s publicly held shares, at a price substantially in excess of the market price that had prevailed for a significantly long period before the tender, was made only after obtaining the favorable advice of investment bankers and legal counsel, it is not conclusive on the issue of good faith and the exercise of business judgment on behalf of the corporation. At least this is so, so long as the grounds for these opinions are not suggested or developed in the motion papers. Hence, summary judgment should not have been granted (cf. Lawrence v. Decca Records, 27 Misc 2d 445, 447). Moreover, such a tender, as is alleged in the complaint in this ease, may constitute a special circumstance sufficient to entitle plaintiff to an examination before trial (cf. Pearson v. Rosenberg, 22 A D 2d 225; 3 Weinstein-Korn-Miller, N. Y. Civ Prac., par. 3101.17).

Concur — Breitel, J. P., McNally, Stevens and Eager, JJ.