A shareholder is permitted to bring suit as a representative of the corporation only if the directors refuse or have a conflict of interest that is likely to keep them from suing.

Question

Quizplus · Accepted Answer

This is known as a derivative lawsuit and a shareholder can only bring such a lawsuit under specific circumstances, such as when the directors refuse or have a conflict of interest that prevents them from pursuing the lawsuit.

A Shareholder Is Permitted to Bring Suit as a Representative