Business Associations Keyed to Hamilton
Donahue v. Rodd Electrotype Co.
Facts
The controlling stockholder of Rodd Electrotype Co. (D), Harry Rodd (D) maneuvered the closely held corporation into repurchasing 45 of his shares for $800 each for a total of $36,000. Rodd (D) then dispersed the rest of his assets in the corporation among his children as gifts. Donahue (P) a minority stockholder who originally refused to ratify this action, offered to sell her holdings at the same price was denied. She (P) filed suit seeking to reverse the purchase and force Rodd (D) to repay the corporation with interest. The trial court found that the purchase had been made without discrimination towards Donahue (P) and dismissed the bill. The appellate court affirmed.
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