The Delaware Court of Chancery recently held in Rainbow Mountain v. Begeman that a pro se defendant was not effectively removed as a director, officer or member of a Delaware nonstock corporation, Rainbow Mountain Inc. This interesting opinion combines the theatrics of family drama with insight into a less common form of Delaware entity: the nonstock corporation. Unlike a typical corporation, Delaware nonstock corporations do not issue stock, and as with LLCs, those with ownership interests are referred to as “members.”
In this declaratory judgment action, the company and defendant, Terry Begeman, sought reciprocal judgments to determine whether Begeman had effectively been removed from the company as a director, officer, and member, and as a result, whether Begeman had a right to occupy company land.
