Andrews v. Sheepscot Island Co.

by
The shareholders of Sheepscot Island Company approved a plan to convert a for-profit corporation into a nonprofit corporation. Some dissenting shareholders (Plaintiffs) filed a complaint seeking declaratory and injunctive relief. In the complaint, Plaintiffs alleged that the nonprofit conversion plan should be invalidated because it failed to reclassify all shares of the corporation equally. The trial court dismissed the complaint with prejudice for failure to state a claim. Plaintiffs appealed, arguing that the trial court incorrectly applied the law governing corporations and nonprofit corporations. The Supreme Judicial Court affirmed, holding that no law prohibits a business corporation’s nonprofit conversion plan from reclassifying the corporation’s shares into membership classes with disparate rights. View "Andrews v. Sheepscot Island Co." on Justia Law