Hale

Meredith S. Hale, M.D. (Hale) appeals a judgment of dismissal in favor of defendants and respondents Southern California IPA Medical Group, Inc. (SCIPA), and SCIPA’s directors, Ronald Accomazzo, M.D., Jerome Kornfeld, M.D., Rene Osman, M.D., Donald W. Sobel, M.D. and Lawrence Stein, M.D. (the directors) (collectively respondents).

The issue presented is whether Corporations Code section 800, requiring the plaintiff in a shareholder derivative action to furnish security for defendants’ expenses if the trial court finds there is no reasonable probability the corporation will benefit from the action, authorizes the trial court to require the plaintiff to post up to $50,000 in security for each moving defendant, or whether the aggregate amount of the bonds that may be required is limited to $50,000.

We conclude $50,000 is the maximum amount of the bond that may be required under section 800, regardless of the number of moving defendants. Therefore, the judgment is reversed with directions.

Factual and Procedural Background

The complaint alleges Hale is a shareholder of SCIPA. In 1995, SCIPA sold substantially all of its assets to third parties. Hale filed a shareholder…