Opinion
05-16-2017
Thomas SUMMER, et al., Plaintiffs–Respondents–Appellants, v. RUCKUS 85 CORP., Defendant–Respondent, Charles Grooms, et al., Defendants, Yvette Georges Deeton, Defendant–Appellant.
David E. Frazer, New York (James B. West of counsel), for appellant. Rosenberg & Estis, P.C., New York (Norman Flitt of counsel), for respondents-appellants. Litchfield Cavo LLP, New York (Michael R. L'Homme of counsel), for respondent.
David E. Frazer, New York (James B. West of counsel), for appellant. Rosenberg & Estis, P.C., New York (Norman Flitt of counsel), for respondents-appellants.
Litchfield Cavo LLP, New York (Michael R. L'Homme of counsel), for respondent.
FRIEDMAN, J.P., RICHTER, MOSKOWITZ, GISCHE, KAPNICK, JJ.
Judgment and order and judgment (one paper), Supreme Court, New York County (Kathryn E. Freed, J.), entered September 3, 2015, to the extent appealed from as limited by the briefs, granting plaintiffs' cross motion for summary judgment on their first cause of action, denying defendant Yvette Georges Deeton's motion to dismiss the first cause of action, denying Deeton's motion for summary judgment as to her first counterclaim, and dismissing the complaint against defendant Ruckus 85 Corp., unanimously modified, on the law, to deny Ruckus's motion to dismiss the complaint against it, and otherwise affirmed, without costs. Appeals (Grooms defendants) from aforementioned judgment and order and judgment (one paper), unanimously dismissed, without costs, as abandoned.
It is undisputed that the December 16, 1998 amendments to the corporation's bylaws and certificate of incorporation required a legend on the stock certificates concerning the lack of a board of directors and the supermajority requirements for a quorum and to transact corporate business, which was never included on the stock certificates provided to three of the named plaintiffs, in violation of Business Corporation Law §§ 620(b) and 616(c). Accordingly, the court properly refused to apply the amendments (see Model, Roland & Co. v. Industrial Acoustics Co., 16 N.Y.2d 703, 705, 261 N.Y.S.2d 896, 209 N.E.2d 553 [1965] ; Matter of Rye Psychiatric Hosp. Ctr., 66 N.Y.2d 333, 337–338, 497 N.Y.S.2d 317, 488 N.E.2d 63 [1985] ).
The corporation was a necessary party to the derivative claims since any recovery on those claims is for its benefit (see Tobias v. Tobias, 192 A.D.2d 438, 440, 596 N.Y.S.2d 797 [1st Dept.1993] ).
We have considered Deeton's remaining arguments and find them unavailing.