New York § 109 - 109Actions or special proceedings by attorney-general

§ 109. 109Actions or special proceedings by attorney-general

§ 109. Actions or special proceedings by attorney-general. (a) The attorney-general may maintain an action or special proceeding: (1) To annul the corporate existence or dissolve a corporation that has acted beyond its capacity or power or to restrain it from the doing of unauthorized business; (2) To annul the corporate existence or dissolve any corporation that has not been duly formed; (3) To restrain any person or persons from acting as a domestic or foreign corporation within this state without being duly incorporated or from exercising in this state any corporate rights, privileges or franchises not granted to them by the law of the state; (4) To procure a judgment removing a director of a corporation for cause under section 706 (Removal of directors); (5) To dissolve a corporation under article 11 (Judicial dissolution); (6) To restrain a foreign corporation or to annul its authority to do business in this state under section 1303 (Violations). (7) Upon written application, ex parte, for an order to the supreme court at a special term held within the judicial district where the office of the corporation is located, and if the court so orders, to inspect the books and records of the corporation to the extent that such inspection is available to shareholders and directors under the law of this state. Such application shall contain a statement that the inspection is necessary to protect the interests of the people of this state. This paragraph applies to every corporation, no shares of which are listed on a national securities exchange or regularly quoted in an over-the-counter market by one or more members of a national or an affliated securities association. This paragraph does not apply to a corporation all shares of which are owned either directly or through a wholly owned subsidiary by a corporation or corporations to which this paragraph does not apply. (8) To collect any fines payable to the department of state pursuant to section four hundred nine of this chapter. (b) In an action or special proceeding brought by the attorney-general under any of the provisions of this chapter: (1) If an action, it is triable by jury as a matter of right. (2) The court may confer immunity in accordance with the provisions of section 50.20 of the criminal procedure law. (3) A temporary restraining order to restrain the commission or continuance of the unlawful acts which form the basis of the action or special proceeding may be granted upon proof, by affidavit, that the defendant or defendants have committed or are about to commit such acts. Application for such restraining order may be made ex parte or upon such notice as the court may direct. (4) If the action or special proceeding is against a foreign corporation, the attorney-general may apply to the court at any stage thereof for the appointment of a temporary receiver of the assets in this state of such foreign corporation, whenever it has assets or property of any kind whatsoever, tangible or intangible, within this state. (5) When final judgment in such action or special proceeding is rendered against the defendant or defendants, the court may direct the costs to be collected by execution against any or all of the defendants or by order of attachment or other process against the person of any director or officer of a corporate defendant. (6) In connection with any such proposed action or special proceeding, the attorney-general may take proof and issue subpoenas in accordance with the civil practice law and rules. (c) In any such action or special proceeding against a foreign corporation which has not designated the secretary of state as its agent for service of process under section 304 (Statutory designation of secretary of state as agent for service of process), any of the following acts in this state by such foreign corporation shall constitute the appointment by it of the secretary of state as its agent upon whom process against such foreign corporation may be served: (1) As used in this paragraph the term "resident" shall include individuals, domestic corporations and foreign corporations authorized to do business in the state. (2) Any act done, or representation made as part of a course of the solicitation of orders, or the issuance, or the delivery, of contracts for, or the sale of, property, or the performance of services to residents which involves or promotes a plan or scheme to defraud residents in violation of the laws or the public policy of the state. (3) Any act done as part of a course of conduct of business in the solicitation of orders from residents for property, goods or services, to be delivered or rendered within this state to, or on their behalf, where the orders or contracts are executed by such residents within this state and where such orders or contracts are accompanied or followed by an earnest money desposit or other down payment or any installment payment thereon or any other form of payment, which payment is either delivered in or transmitted from the state. (4) Any act done as part of the conduct of a course of business with residents which defrauds such residents or otherwise involves or promotes an attempt by such foreign corporation to circumvent the laws of this state. (d) Paragraphs (b), (c), (d) and (e) of section 307 (Service of process on unauthorized foreign corporation) shall apply to process served under paragraph (c).