Delano v. Kitch, s. 74-1897

• Decision Date: 13 May 1977
• Docket Number: 74-1898,75-1442,Nos. 74-1897,75-1012,s. 74-1897
• Citation: 554 F.2d 1004
• Parties: Victor DELANO, Individually and Derivatively on Behalf of Wichita Eagle and Beacon Publishing Company, Inc., Plaintiff-Appellant, v. Paul R. KITCH, Harry B. Brown, Jr., Ward E. Colwell, Richard M. Jennings, Paula R. Murdock, Janet M. Jennings, Foster Jennings, Vici McComb, David Colwell, * Victoria Bloom, * First National Bank in Wichita, Executor of the Will and Estate of Marcellus M. Murdock, Deceased, and Trustee, Defendants-Appellees. to 75-1444.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1004

554 F.2d 1004

Victor DELANO, Individually and Derivatively on Behalf of Wichita Eagle and Beacon Publishing Company, Inc. Plaintiff-Appellant, v. Paul R. KITCH, Harry B. Brown, Jr., Ward E. Colwell, Richard M. Jennings, Paula R. Murdock, Janet M. Jennings, Foster Jennings, Vici McComb, David Colwell, ^* Victoria Bloom, ^* First National Bank in Wichita Executor of the Will and Estate of Marcellus M. Murdock Deceased, and Trustee, Defendants-Appellees.

Nos. 74-1897, 74-1898, 75-1012, 75-1442 to 75-1444.

United States Court of Appeals Tenth Circuit.

May 13, 1977.

Paul Martin Wolff, of Williams, Connolly & Califano, Washington, D. C. (Paul R. Connolly, Jeremiah C. Collins, and Allan A. Ryan, Jr., Washington, D. C., Robert Martin and Paul B. Swartz, of Martin, Pringle, Schell & Fair, Wichita, Kan., of counsel, with him on the brief), for plaintiff-appellant, Victor Delano.

Ronald K. Badger, Wichita, Kan., for plaintiff-appellant, Victoria Bloom.

Charles W. Harris, of Curfman, Brainerd, Harris, Bell, Weigand & Depew, Wichita, Kan. (Lawrence E. Curfman, Jack Scott McInteer, and Sidney J. Brick, Wichita, Kan., with him on the brief), for plaintiff-appellant, First National Bank in Wichita.

Wayne Coulson, Wichita, Kan., for defendants-appellees.

Before SETH, McWILLIAMS and DOYLE, Circuit Judges.

SETH, Circuit Judge.

OPINION ON MOTION FOR CLARIFICATION

This court filed an original opinion in this appeal, and certain parties have petitioned for rehearing or for clarification. It appears that an issue relative to the "stockholder's right of refusal," originally contained in the Articles of Incorporation of the newspaper, around which the litigation centered, was not covered in the original opinion. This opinion considers that issue and thus supplements what was said in the original opinion.

From the record it appears that a stockholders' meeting of the newspaper was called for the purpose of voting on whether or not the first refusal provision in the Articles be eliminated. This provision gave stockholders the right to meet offers made by "outsiders" for the purchase of other stockholders' shares. The then contemplated sale of the shares of the corporation to Ridder was also to be considered and "finalized" at this meeting.

The plaintiff Delano sought to enjoin the meeting on the ground that under Kansas law the right of refusal could not be so removed from the Articles by a vote of the stockholders otherwise sufficient in number to amend the Articles. He brought the proceedings for an injunction before Judge Langley to whom the case was then assigned.

Judge Langley held a thorough evidentiary hearing to consider the issue. He concluded that the provision could be eliminated from the Articles by a vote of the shareholders, and that insufficient equitable considerations had been advanced by the plaintiff.

An appeal to this court was taken from the denial of relief by Judge Langley. This court issued a temporary order to restrain further corporate proceedings until a hearing could be had. A special hearing was held, and a majority of the panel ordered the temporary injunction lifted. This Order in part said:

"1. The Order of this Court heretofore entered on April 19, 1973 is hereby vacated and dissolved insofar as such Order enjoined the Defendants from conducting a meeting of the Shareholders of the Wichita Eagle and Beacon Publishing Company,...