Steinberg v. American Bantam Car Co.
| Decision Date | 23 February 1949 |
| Docket Number | No. 9634.,9634. |
| Citation | 173 F.2d 179 |
| Parties | STEINBERG v. AMERICAN BANTAM CAR CO. et al. |
| Court | U.S. Court of Appeals — Third Circuit |
Kenneth G. Jackson, of Pittsburgh, Pa. (William D. Sutton and Thorp, Bostwick, Reed & Armstrong, all of Pittsburgh, Pa. on the brief), for appellants.
Francis D. Wells, of New York City, (Beck, McGinnis & Jarvis, of Pittsburgh, Pa. on the brief), for appellee.
Before BIGGS, Chief Judge and GOODRICH and O'CONNELL, Circuit Judges.
Steinberg, a citizen of New York and a stockholder of American Bantam Car Company (Bantam), a Pennsylvania corporation, brought suit against Bantam, against certain of its officers, against Bowes, Kissel and Croll, named as proxy holders in a proxy form dispatched by the management of Bantam to its stockholders. The proxies were intended to be voted at a postponed annual stockholders' meeting of Bantam. Bowes was alleged in the complaint to be a citizen of Illinois; Croll, a citizen of Pennsylvania, and Kissel, a citizen of New York. The complaint contained the usual allegation as to jurisdictional amount. It asserted also that Croll, the secretary of Bantam, had failed to call the annual meeting of stockholders on September 15, 1947 as required by the by-laws; that an audit of Bantam's books as completed August 18, 1947 showed that Bantam had sustained a loss of nearly a million and a quarter dollars for the fiscal year ending June 30, 1947, and that the audit was not forwarded to stockholders until December 9, 1947. Steinberg also alleged that Bantam's management had thrown difficulties in the way of an independent stockholders' committee (of which Steinberg was a member) which sought to obtain a list of stockholders, many stockholders of Bantam being desirous of effecting a change in the management of the corporation. The complaint prayed the court below to enjoin the holding of the postponed annual stockholders' meeting scheduled for February 16, 1948 "* * * to the end that a reasonable time will be accorded to the Independent Stockholders' Committee * * to solicit proxies. * * *"
The complaint was filed on February 13, 1948 and on the same day the court below issued a temporary restraining order restraining the three proxy-holder defendants, including Kissel, from voting any proxies obtained by them at an adjourned annual stockholders' meeting which had been scheduled by the management for February 16, 1948, and set the application for an interlocutory injunction down for hearing on February 24. The final sentence of the temporary restraining order stated: "Injunction bond to be given in the sum of $5,000.00." On February 13 a bond designated as a "Bond for Temporary Restraining Order" was given by a surety company in the amount specified, expressly conditioned as follows: "Now the condition of this obligation is such that if the said plaintiff shall indemnify the said defendants for all damages that may be sustained by reason of said temporary restraining order, then this obligation to be void; otherwise, to be and remain in full force and virtue, provided it is finally determined that the Plaintiff was not justly entitled to such temporary restraining order."1
On February 16 the plaintiff moved to discontinue the proceedings against Kissel, who, as has been pointed out, was alleged to be a citizen of New York, and to dismiss the action as to him apparently in order to avoid the charge of lack of diversity. The court orally granted this motion.2 On the same day the defendants moved to dismiss the complaint on several grounds including want of diversity and improper...
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...The subsequent appeal was dismissed as moot because "the stockholders' meeting has long since been held." Steinberg v. American Bantam Car Co., 173 F.2d 179, 180 (3d Cir.1949). [¶ 27] The gist of Ward County Farm Bureau's complaint in this case is the failure of Nodak and the Commissioner t......
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