Byron Jackson Co. v. Patterson-Ballagh Corp.

This is an appeal by a stockholder in appellee corporation in a derivative stockholder’s suit, from a judgment holding that the appellees Ballagh and Miller, directors of the appellee corporation, were legally paid certain compensation for services rendered the latter corporation.

The suit is at common law for a money damage for the claimed wrongful acts of the directors. Though fraud is alleged, no accounting or other equitable relief is sought. The remedy at law of money damages is adequate and the only one sought. The jurisdiction of the district court is based upon the diversity of citizenship be *767 tween appellant, a Delaware corporation, plaintiff below, and the appellee corporation, organized under the laws of California, and the appellee directors, citizens of California, defendants below.

Appellee corporation is engaged in the business of supplying to those drilling wells for mineral oils various special devices to facilitate such business. The evidence shows the business is highly competitive and that continued improvements patented and otherwise require a management active in seeking to keep ahead of competitors.

At all pertinent times the appellee directors…