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Civil Procedure Keyed to Marcus
Cohen v. Beneficial Industrial Loan Corporation
Citation:
337 U.S. 541 (1949)Facts
Petitioner filed a shareholder derivative action against Respondent in federal district court in New Jersey. Two years after the action was filed, New Jersey enacted a law, applied retroactively, that required that in certain shareholder derivative actions, where the shareholder owned less than a certain percentage of stock, a bond to cover the defendant’s costs had to be posted by the plaintiff in order to proceed with the action. The district court held that the state law did not apply to lawsuits in federal court.
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Appellate Review