October 2014 LACBA MCLE Test and Answer Sheet

Test No. 239: Still Standing

To access the article related to this test, please click here.
  
Instructions for Obtaining MCLE Credit

The Los Angeles County Bar Association certifies that this activity has been approved for Minimum Continuing Legal Education credit by the State Bar of California in the amount of 1 hour. To apply for credit, please follow the instructions.

1. Study the CLE article.

2. Answer the test questions by marking the appropriate boxes. Each question has only one answer.

3. Photocopies of this answer sheet may be submitted; however, this form should not be enlarged or reduced. Mail the answer sheet and the $20 testing fee ($25 for non-LACBA members) to:

Los Angeles Lawyer
MCLE Test
P.O. Box 55020
Los Angeles, CA 90055

Make checks payable to Los Angeles Lawyer.

4. You can also fill in the test form and submit it directly to LACBA by clicking "Submit." To submit your test answers online you will need to pay by credit card. After submitting your answers you will be presented with a screen requesting payment information. This information will be submitted in a secure mode which will allow you to safely transmit your credit card number over the Internet. If you prefer not to pay by credit card, please print this answer sheet and submit your responses by regular mail.

5. Within six weeks, Los Angeles Lawyer will return your test with the correct answers, a rationale for the correct answers, and a certificate verifying the CLE credit you earned through this self-assessment activity.

6. For future reference, please retain the CLE test materials returned to you.


 

Test Sheet
 



  
Mark your answers to the test by clicking next to your choice.  All questions must be answered.  Each question has only one answer. This test is worth 1 hour of credit.*

1. A shareholder bringing a derivative action does not need to include the corporation as a party in the action.


2. A shareholder may assert both direct and derivative claims in the same action.


3. A nonshareholder spouse can establish standing as a derivative plaintiff through community property rights in his or her spouse’s shares.


4. A plaintiff in a derivative action must show:




5. The contemporaneous-ownership rule requires a derivative plaintiff to be a shareholder:




6. A derivative plaintiff must fairly and adequately represent all shareholders and not just those that are similarly situated.


7. A derivative plaintiff owning 20 percent of a closely held corporation cannot adequately represent the interest of the corporation in an action which his or her interests are adverse to the corporate officers owning the remaining 80 percent of the shares.


8. Under California law, a court can waive the contemporaneous-ownership rule if it determines that there is no one else to enforce the claims on the corporation’s behalf against defendants who would otherwise retain their ill-gotten gains.


9. Fair and adequate representation is a requirement under:




10. The continuing-wrong doctrine is an exception to contemporaneous ownership rule if the alleged wrong was in progress when the shareholder acquired his or her shares.


11. Under federal law, factors that determine whether a derivative plaintiff can properly represent the interest of other shareholders include whether the plaintiff:




12. California cases have required the appointment of a derivative plaintiff the same as one would appoint a guardian ad litem.


13. Demand futility is a prefiling requirement that a derivative plaintiff make a demand on the board to take action.


14. A derivative action inherently involves a conflict between the minority shareholders bringing the action and the majority shareholders whose administration is being challenged.


15. Grosset v. Wenaas was an action involving a derivative plaintiff




16. Generally, in actions involving both derivative and direct claims, the claims arise from the same course of conduct, but the injuries differ.


17. A prelitigation demand is a necessary first step in a derivative action unless such a demand would be useless or futile.


18. A plaintiff can be disqualified for bringing both direct and derivative claims.


19. The Federal Rules of Civil Procedure and the California Corporations Code have analogous requirements for fair and adequate representation.


20. Any recovery in a derivative action goes to:




Before clicking the Submit button, please verify that all questions have been answered. An error message will appear if not all questions are answered.

* The Los Angeles County Bar Association has been approved as a continuing legal education provider of Minimum Continuing Legal Education credit by the State Bar of California. This self-assessment activity will qualify for Minimum Continuing Legal Education legal ethics credit by the State Bar of California in the amount of one hour.