BURG V. HORN
380 F.2d 897 (2d Cir. 1967)
NATURE OF THE CASE: This case involves the corporate opportunity doctrine in a small corporation. It is notable to show how courts will not adhere to a strict definition of the doctrine, but will adjust it on a case by case basis. This is an example of the interest or expectancy test used by New York. Burg (P) appealed from a judgment, which dismissed her derivative complaint alleging that Horn (Ds) breached their duties to the corporation by seizing a corporate opportunity.
FACTS: The Horns (D) formed a corporation with the Burgs (P) to acquire property in Brooklyn, New York. The purpose of the corporation was to buy four buildings in the area. The Horns had been in the business of acquiring properties and then renovating and reselling them before they formed this corporation. After the formation of the corporation D purchased some property on his own, without disclosing this fact to the P. A separate dispute arose between the two parties about the accounting of rent receipts. P then decided to sue D for purchasing those properties without informing him of them and allowing the corporation to decide whether it wanted the property. P claims that D usurped a business opportunity that belonged to the corporation.
ISSUE:
RULE OF LAW:
HOLDING AND
DECISION:
LEGAL ANALYSIS:
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