Supreme Court of Indiana
798 N.E.2d 440 (2003)
F.B.I Farms, Inc. (F.B.I.) (defendant) is a close corporation formed and initially wholly owned by Ivan and Thelma Burger, their children Linda and Freddy, and the children’s spouses. In 1977, F.B.I.’s board, which included Linda’s husband Birchell Moore (plaintiff), adopted several stock transfer restrictions. They prohibited any stock transfers without board approval, and granted right of first refusal for any stock purchases first to the corporation, then to any shareholders, and finally to any blood member of the family. Linda and Moore divorced in 1982. As part of the settlement, Linda acquired all of Moore’s F.B.I. shares, and Moore acquired a monetary judgment of over $150,000 secured by a lien on Linda’s stock. Moore’s judgment remained unsatisfied in 1998. He successfully executed on the lien and brought the stock to sheriff’s sale, where he purchased it. F.B.I. attempted to cancel Moore’s stock arguing that the restrictions were violated. Moore then filed suit against F.B.I., seeking a declaratory judgment that the attempted cancelation was invalid, and that Moore owned the shares rightfully and free of the transfer restrictions. The trial court granted partial summary judgment in favor of Moore, agreeing that Moore was the rightful owner and finding that the restrictions requiring director approval and granting first refusal to blood family members were unreasonable and unenforceable. The appellate court affirmed, partially on the grounds that transfer restrictions do not apply to involuntary transfers such as a sheriff’s sale.
Rule of Law
Holding and Reasoning (Boehm, J.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.
Here's why 203,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 14,000 briefs, keyed to 188 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.