Facts: Tomlinson and Hubbard were two of five shareholders in a corporation known as Multimedia Software Distributors. The corporation was formed in 1993 and filed for bankruptcy in 1994. In 1996, Tomlinson filed a claim in his own name alleging that Hubbard breached his fiduciary duties to him by diverting proceeds owned by Multimedia to another business owned by Hubbard. Hubbard contends that Tomlinson is an improper plaintiff.

Decision: Judgement for Hubbard. Shareholders of a corporation may not maintain actions in their own names to redress an injury to the corporation even if the value of their stock is impaired as a result of the injury. They must bring action derivatively because direct action would ignore the corporation entity, fail to protect the corporation from multiple lawsuits, and be unfair to the corporation's creditors. Tomlinson, who is one of five shareholders, in his direct lawsuit would not protect other innocent shareholders. [Hubbard v Tomlinson, 747 NE2d 69 (Ind App 2001)]

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