Clarence Venner v. Great Northern Railway Company, No. 485

CourtUnited States Supreme Court
Writing for the CourtMoody
Citation52 L.Ed. 666,28 S.Ct. 328,209 U.S. 24
PartiesCLARENCE H. VENNER, Appt., v. GREAT NORTHERN RAILWAY COMPANY and James J. Hill
Docket NumberNo. 485
Decision Date24 February 1908

209 U.S. 24
28 S.Ct. 328
52 L.Ed. 666
CLARENCE H. VENNER, Appt.,

v.

GREAT NORTHERN RAILWAY COMPANY and James J. Hill.

No. 485.
Submitted January 20, 1908.
Decided February 24, 1908.

Page 25

Messrs. Abram J. Rose, George H. Yeaman, Alfred C. Pett e, and Stephen M. Yeaman for appellant.

[Argument of Counsel from pages 25-27 intentionally omitted]

Page 27

Mr. Julius F. Workum for appellees.

[Argument of Counsel from pages 27-28 intentionally omitted]

Page 28

Mr. Justice Moody delivered the opinion of the court:

The appellant, a citizen of New York, brought this suit in equity in the supreme court of New York against the defendant railroad, a citizen of Minnesota, and the other defendant, its president, also a citizen of Minnesota. The complaint set forth in substance the following facts upon which the right to relief was claimed: The plaintiff was a stockholder in the defendant railroad at the time of the beginning of the

Page 29

suit in 1906. Whether or not he was a stockholder at the time when the alleged wrongful acts were committed by the defendants does not appear by any allegation in the complaint. The defendant James J. Hill was a director and the president of the other defendant, the Great Northern Railway Company, and that railroad and its board of directors were under his absolute control. While holding these offices and exercising this control, in 1900 and 1901, Hill purchased, or caused to be purchased for his use, stock of the Chicago, Burlington, & Quincy Railroad Company of the par value of $25,000,000, at an average price of $150 a share. This purchase was made with the design of selling the stock at a higher price to the company of which he was a director and president. Subsequently, in 1901, while still holding his offices in the Great Northern Railway and exercising the same control over that corporation, he sold to it a large amount of the stock of the Chicago, Burlington, & Quincy Railroad Company owned by him, and made an unlawful profit of $10,000,000 on the transaction. Before bringing this suit the plaintiff demanded of the Great Northern Railway Company that it bring suit against Hill to compel him to account for and pay over to it the wrongful profit which he had obtained. The railroad refused to comply with this demand, and thereupon the plaintiff brought this suit as a stockholder, in his own behalf, and in the behalf and for the benefit of other stockholders similarly situated. The prayer was that Hill should account for his profit and pay it to the Great Northern Railway Company with interest, and for general relief. On the defendants' petition the case was removed to the United States circuit court for the southern district of New York, on the ground of diversity of citizenship of the plaintiff and the defendants. In that court the plaintiff was ordered to 'replead the complaint herein according to the forms and practice prevailing in equity.' This was done on November 9, 1906. The new complaint set forth the facts in greater detail and with some variations, but its substance and effect was

Page 30

similar to that of the first complaint. The complaint did not conform to the requirements of the 94th equity rule, relating to suits of this nature, in that it failed to allege that the plaintiff was a shareholder at the time of the transactions of which he complains, or that his shares had devolved on him since by operation of law, or that the suit was not collusive, or the particulars of his efforts to procure action by the corporation defendant. The defendants then demurred separately to the bill, and the defendant Hill subjoined to his demurrer an affidavit denying every allegation in it tending to show wrongful conduct on his part. Thereafter the plaintiff moved to remand the cause to the state court on the ground that the circuit court was without jurisdiction over it. This motion was denied. The demurrer was sustained and the bill dismissed. The correctness of the ruling on the demurrer and the dismissal is not before us. The case comes here on direct appeal from the circuit court on the question of jurisdiction alone, certified in the following terms: 'Now, therefore, the court hereby certifies to the Supreme Court of the United States the question of jurisdiction which has arisen upon the aforesaid motion to remand and the demurrers to the complaint, to wit: Whether or not the complainant's amended bill of complaint showed that there was such diversity of citizenship between the party complainant and the parties defendants in this cause as would be sufficient, under the provisions of the United States Revised Statutes, to confer jurisdiction upon the United States circuit court for the southern district of New York of this cause, and whether this cause, as brought in the supreme court of the state of New York, was one over which this court would have had original jurisdiction, and was therefore removable into this court.'

We consider nothing but the question of jurisdiction, and express no opinion upon the decision upon the demurrer, which is not properly here. Schunk v. Moline, M. & S. Co. 147 U. S. 500, 37 L. ed. 255, 13 Sup. Ct. Rep. 416; Smith v. Mckay, 161 U. S. 355, 40 L. ed. 731, 16 Sup. Ct. Rep. 490; Mexican C. R. Co. v. Eckman, 187 U. S. 429, 47 L. ed. 245, 23 Sup. Ct. Rep. 211; Hennessy v.

Page 31

Richardson Drug Co. 189 U. S. 25, 47 L. ed. 697, 23 Sup. Ct. Rep. 532; Chicago v. Mills, 204 U. S. 321, 51 L. ed. 504, 27 Sup. Ct. Rep. 286.

The cause was removable to the circuit court by the defendants if it was one of which that court was given jurisdiction. 25 Stat. at L. 434, chap. 866, U. S. Comp. Stat. 1901, p. 508; Mexican Nat. R. Co. v. Davidson, 157 U. S. 201, 39 L. ed. 672, 15 Sup. Ct. Rep. 563; Madisonville Traction Co. v. St. Bernard Min. Co. 196 U. S. 239, 49 L. ed. 462, 25 Sup. Ct. Rep. 251. The only ground of original jurisdiction or of removal was that the suit was a controversy between citizens of different states. In that case Congress has given the circuit court jurisdiction over it, with certain limitations not material here. 25 Stat. at L. 434, chap. 866, U. S. Comp. Stat. 1901, p. 508. The plaintiff contends that the circuit court was without jurisdiction of the cause, and...

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98 practice notes
  • Stoddard v. Ling-Temco-Vought, Inc., No. CV-72-1294-PGH.
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Central District of California
    • January 27, 1981
    ...4 The Supreme Court long ago spoke of this procedural rules-jurisdiction distinction. The appellant in Venner v. Great Northern Railway, 209 U.S. 24, 28 S.Ct. 328, 52 L.Ed. 666 (1908), argued that noncompliance with the predecessor rule to Rule 23.1, F.R.Civ.P. (shareholder derivative actio......
  • City of Indianapolis v. Chase Nat Bank of City of New York Chase Nat Bank of City of New York v. Citizens Gas Co of Indianapolis Same v. Indianapolis Gas Co 8212 13, Nos. 10
    • United States
    • United States Supreme Court
    • November 10, 1941
    ...532, 15 S.Ct. 430, 432, 39 L.Ed. 520; Doctor v. Harrington, 196 U.S. 579, 25 S.Ct. 355, 49 L.Ed. 606; Venner v. Great Northern R. Co., 209 U.S. 24, 28 S.Ct. 328, 52 L.Ed. 666; Steele v. Culver, 211 U.S. 26, 29, 29 S.Ct. 9, 53 L.Ed. 74; Lee v. Lehigh Valley Coal Co., 267 U.S. 542, 45 S.Ct. 3......
  • Smith v. Sperling, No. 316
    • United States
    • United States Supreme Court
    • June 10, 1957
    ...normally is cast in terms of fraud, breach of trust, or illegality. See Doctor v. Harrington, supra; Venner v. Great Northern R. Co., 209 U.S. 24, 28 S.Ct. 328, 52 L.Ed. 666; Koster v. (American) Lumbermens Mutual Casualty Co., 330 U.S. 518, 522, 523, 67 S.Ct. 828, 830—831, 91 L.Ed. 1067. T......
  • Hernandez v. Grisham, No. CIV 20-0942 JB\GBW
    • United States
    • United States District Courts. 10th Circuit. District of New Mexico
    • October 14, 2020
    ...officials defending against suit which seeks only prospective relief from violations of federal law. See Ex Parte Young, 209 U.S. at 128, 28 S.Ct. 328. The Ex Parte Young doctrine allows suit to proceed against defendant state officials if the following requirements are met: (i) the plainti......
  • Request a trial to view additional results
97 cases
  • Stoddard v. Ling-Temco-Vought, Inc., No. CV-72-1294-PGH.
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Central District of California
    • January 27, 1981
    ...4 The Supreme Court long ago spoke of this procedural rules-jurisdiction distinction. The appellant in Venner v. Great Northern Railway, 209 U.S. 24, 28 S.Ct. 328, 52 L.Ed. 666 (1908), argued that noncompliance with the predecessor rule to Rule 23.1, F.R.Civ.P. (shareholder derivative actio......
  • City of Indianapolis v. Chase Nat Bank of City of New York Chase Nat Bank of City of New York v. Citizens Gas Co of Indianapolis Same v. Indianapolis Gas Co 8212 13, Nos. 10
    • United States
    • United States Supreme Court
    • November 10, 1941
    ...532, 15 S.Ct. 430, 432, 39 L.Ed. 520; Doctor v. Harrington, 196 U.S. 579, 25 S.Ct. 355, 49 L.Ed. 606; Venner v. Great Northern R. Co., 209 U.S. 24, 28 S.Ct. 328, 52 L.Ed. 666; Steele v. Culver, 211 U.S. 26, 29, 29 S.Ct. 9, 53 L.Ed. 74; Lee v. Lehigh Valley Coal Co., 267 U.S. 542, 45 S.Ct. 3......
  • Smith v. Sperling, No. 316
    • United States
    • United States Supreme Court
    • June 10, 1957
    ...normally is cast in terms of fraud, breach of trust, or illegality. See Doctor v. Harrington, supra; Venner v. Great Northern R. Co., 209 U.S. 24, 28 S.Ct. 328, 52 L.Ed. 666; Koster v. (American) Lumbermens Mutual Casualty Co., 330 U.S. 518, 522, 523, 67 S.Ct. 828, 830—831, 91 L.Ed. 1067. T......
  • Hernandez v. Grisham, No. CIV 20-0942 JB\GBW
    • United States
    • United States District Courts. 10th Circuit. District of New Mexico
    • October 14, 2020
    ...officials defending against suit which seeks only prospective relief from violations of federal law. See Ex Parte Young, 209 U.S. at 128, 28 S.Ct. 328. The Ex Parte Young doctrine allows suit to proceed against defendant state officials if the following requirements are met: (i) the plainti......
  • Request a trial to view additional results

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