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Keating v. K-C-K Corp.

Texas Court of Civil Appeals
383 S.W.2d 69 (1964)


Facts

Shareholders of K-C-K Corporation (defendant) elected three directors to its board in 1957 and 1958. Over the next four years (1959–1962), K-C-K shareholders elected four directors to its board with 100 percent attendance and support of the shareholders. K-C-K’s corporate charter permitted the number of directors to be fixed by its bylaws. The charter also provided the board with the power to amend its bylaws. In 1963, a motion to elect only three directors carried by a simple majority vote. However, one of K-C-K’s bylaws required a three-fourths majority vote of the shareholders to amend its bylaws. Keating (plaintiff), an officer of K-C-K, opposed the change from four directors back to three directors as an invalid amendment to the bylaws. Keating brought suit. The lower court ruled that the election of only three directors was valid. Keating appealed to the Texas Court of Civil Appeals.

Rule of Law

Issue

Holding and Reasoning (Coleman, J.)

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