Law 494

Part 1

Shlensky v. Wrigley

Facts:

William Shlensky (plaintiff/appellant), minority stock holder for the Chicago Cubs baseball team sued the team directors who deferred the case to Phillip Wrigley (defendant/appellee) stating mismanagement and negligence because of the refusal of the directors in installing lights at Wrigley Field, home field for the Chicago Cubs.

Procedural History:

Plaintiff original case was lost at trial and plaintiff appealed.

Issue:

The issue is whether the court should step in and overrule when plaintiff cannot prove that directors are committing any fraud, illegality or conflict of interest.

Rule:

A court will not interfere with an honest business judgment absent of a showing of fraud, illegality or conflict of interest.

Holding:

The appeals court affirms that ruling of the trial court.

Reasoning:

Plaintiff argues that because the defendants refuse to install lights in the park because they deemed that baseball is a daytime sport and that having lights installed and night games would have a deteriorating effect upon the surrounding neighborhood. The plaintiff also argues that the team is losing money and he believes that the team is loosing because poor attendance to the games and that if lights were not installed they would continue loosing. In this case the court could not side with the plaintiff because none of his arguments prove that the defendants are mismanaging the team just because they prefer to have day games. The court used Wheeler v. The Pullman Iron & Steel Co. to show that “it is fundamental in the law of corporations that the majority stockholders shall control the policy of the corporation”.
This case proves that the defendant and the stockholders he represented were the majority stockholders, the plaintiff is a minority stockholder and the majority stockholders can