(1) A proceeding may be brought in the right of a domestic or foreign corporation to procure a judgment in its favor by:
(a) Any member or members having two percent or more of the voting power or by 20 members, whichever is less; or
(b) Any director.
(2) In any such proceeding, each member complainant shall have been a member when the transaction complained of occurred.
(3) A complaint in a proceeding brought in the right of a corporation must allege with particularity the demand made, if any, to obtain action by the board of directors and either that the demand was refused or ignored or why a demand was not made. Whether or not a demand for action was made, if the corporation commences an investigation of the charges made in the demand or complaint, the court may stay any proceeding until the investigation is completed.
(4) The complainants shall notify the Attorney General within 10 days after commencing any proceeding under this section if the proceeding involves a public benefit corporation or assets held in charitable trust by a mutual benefit corporation.
(5) A proceeding commenced under this section may not be discontinued or settled without the courtís approval. If the court determines that a proposed discontinuance or settlement will substantially affect the interest of the corporationís members or a class of members, the court shall direct that notice be given the members affected. [1989 c.1010 §50]
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Last modified: August 7, 2008