Segal v. H. Verby Co.

In a proceeding by a shareholder of a corporation for inspection of books of the corporation, the corporation appeals from two orders of the Supreme Court, Queens County, dated June 2, 1971 and September 7, 1971, respectively, the first granting the application and the second granting the corporation’s motion for reargument, but adhering to the original decision. Appeal from order of June 2, 1971 dismissed as academic. That order was superseded by the order granting reargument. Appeal from so much of the order of September 7, 1971 as granted reargument dismissed. Appellant is not aggrieved by that part of the order. Order of September 7, 1971 otherwise modified, in the exercise of discretion, by adding thereto a decretal paragraph excluding from the inspection and copying the names and addresses *856of the corporation’s customers and any business secrets. As so modified, order affirmed to the extent of its review herein. Petitioner is granted $10 costs and disbursements to cover both appeals. In our opinion, Special Term correctly found that petitioner was entitled to inspect the corporate records. However, in view of the fact that petitioner is affiliated with a business similar to the corporation’s, fairness requires, even in the absence of demonstrated bad faith, that the corporation’s legitimate business interests be protected (People ex rel. Ludwig v. Ludwig & Co., 126 App. Div. 696). Latham, Acting P. J., Shapiro, Gulotta and Christ, JJ., concur.