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Constitutional Law–Due Process–Equal Protection Of The Laws–Anti-"Strike Suit'' Legislation Held Constitutional, Joseph Gricar S.Ed.

Michigan Law Review

Plaintiff brought a derivative suit against the defendant, a Delaware corporation, in a United States district court in New Jersey. While the suit was in process, New Jersey passed a statute permitting a corporation in whose name a suit was brought to demand security for reasonable expenses including attorney fees. The plaintiff stockholder was to be liable for such expenses if the suit was unsuccessful. The statute was not to apply when the complainant's holding represented 5% of the par or stated value of the corporation's outstanding stock or had a value of $50,000. Since the act applied to suits …