H. M. Greenspun v. Del E. Webb Corporation, Etc.

Shareholder Greenspun brought a derivative suit against the Del E. Webb Corporation, its directors, and its auditors, Peat, Marwick, Mitchell & Co. The district court granted motions to dismiss in favor of all defendants on the grounds that: (1) the Nevada long-arm statute did not grant personal jurisdiction over any defendant; (2) plaintiff had not made the demand upon the board of directors required by Fed.R. Civ.P. 23.1 or adequately explained this failure; and (3) plaintiff was unable to join the Del E. Webb Foundation, an indispensable party. We hold that personal jurisdiction should have been exercised over defendants Johnson and Peat, Marwick, Mitchell & Co. We further hold that plaintiff did not comply with Fed.R.Civ.P. 23.1. Finally, we hold erroneous the district court’s ruling that the Foundation was an indispensible party.

I. FACTS

Greenspun initiated a shareholder’s derivative action for waste and mismanagement against Del E. Webb Corporation (Webb Corp.), an Arizona corporation*; its nine directors; director Johnson in his capacity as executor of the Del E. Webb estate ; and the corporation’s independent auditor, Peat, Marwick, Mitchell & Co. (Peat Mar-wick), a New…