A Derivative Suit Is Based on a Direct Injury to a Shareholder

question 34

True/False

A derivative suit is based on a direct injury to a shareholder.

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Definitions:

Federal Law

Federal Law consists of the body of law created by the federal government of a country, governing relationships, powers, and structure of its entities and individuals.

Restatement Test

A legal principle used to clarify the law by restating existing statutes or case law in a simplified manner.

Liability for Negligence

The legal responsibility that arises when someone fails to exercise a reasonable standard of care, resulting in harm or damage.

Substantial Performance

Substantial performance is a legal principle indicating that if a party has performed enough of its contract obligations, it can demand payment or compensation, minus deductions for unfinished or incorrect work.