2012 New York Consolidated Laws
BSC - Business Corporation
Article 6 - (601 - 630) SHAREHOLDERS
626 - Shareholders' derivative action brought in the right of the corporation to procure a judgment in its favor.

 
  § 626. Shareholders'  derivative  action  brought  in  the  right of the
           corporation to procure a judgment in its favor.
    (a) An action may be brought in the right of  a  domestic  or  foreign
  corporation to procure a judgment in its favor, by a holder of shares or
  of  voting  trust  certificates  of  the  corporation or of a beneficial
  interest in such shares or certificates.
    (b) In any such action, it shall be made to appear that the  plaintiff
  is such a holder at the time of bringing the action and that he was such
  a  holder  at the time of the transaction of which he complains, or that
  his shares or his interest therein devolved upon  him  by  operation  of
  law.
    (c) In   any   such   action,  the  complaint  shall  set  forth  with
  particularity the efforts of the plaintiff to secure the  initiation  of
  such action by the board or the reasons for not making such effort.
    (d) Such  action  shall  not  be discontinued, compromised or settled,
  without the approval of the court having jurisdiction of the action.  If
  the court shall determine that the interests of the shareholders or  any
  class  or  classes  thereof  will  be  substantially  affected  by  such
  discontinuance, compromise, or settlement, the court, in its discretion,
  may direct that notice, by publication or otherwise, shall be  given  to
  the  shareholders  or  class  or  classes  thereof  whose  interests  it
  determines will be so affected; if notice is so directed  to  be  given,
  the  court  may determine which one or more of the parties to the action
  shall bear the expense of giving the same, in such amount as  the  court
  shall  determine and find to be reasonable in the circumstances, and the
  amount of such expense shall be awarded as special costs of  the  action
  and recoverable in the same manner as statutory taxable costs.
    (e) If  the  action  on  behalf  of the corporation was successful, in
  whole or in part, or if  anything  was  received  by  the  plaintiff  or
  plaintiffs  or  a  claimant  or  claimants  as the result of a judgment,
  compromise or settlement of an action or claim, the court may award  the
  plaintiff  or  plaintiffs,  claimant  or claimants, reasonable expenses,
  including reasonable attorney's fees, and shall direct him  or  them  to
  account to the corporation for the remainder of the proceeds so received
  by  him or them. This paragraph shall not apply to any judgment rendered
  for the benefit of injured shareholders only and limited to  a  recovery
  of the loss or damage sustained by them.