RESPONDENT: Bangor & Aroostook Railroad Company
LOCATION: The White House
DOCKET NO.: 73-718
DECIDED BY: Burger Court (1972-1975)
LOWER COURT: United States Court of Appeals for the First Circuit
CITATION: 417 US 703 (1974)
ARGUED: Apr 15, 1974
DECIDED: Jun 19, 1974
Alan L. Lefkowitz - for respondents
James V. Ryan - for petitioners
Facts of the case
Media for Bangor Punta Operations, Inc. v. Bangor & Aroostook Railroad CompanyAudio Transcription for Oral Argument - April 15, 1974 in Bangor Punta Operations, Inc. v. Bangor & Aroostook Railroad Company
Audio Transcription for Opinion Announcement - June 19, 1974 in Bangor Punta Operations, Inc. v. Bangor & Aroostook Railroad Company
Warren E. Burger:
The disposition of 73-718, Bangor Punta Operations against Bangor & Aroostook Railroad will be announced by Mr. Justice Powell.
Lewis F. Powell, Jr.:
This case comes to us on writ of certiorari to the United States Court of Appeals for the First Circuit.
It involves an action my Maine Railroad Corporation seeking damages from its former owner Bangor Punta Cooperation for alleged acts of corporate mismanagement, acts which took place during the period in which Bangor Punta controlled the railroad.
Amoskeag Co. which now controls the railroad purchased 98% of its shares from Bangor Punta, long before the alleged wrongs occurred.
Amoskeag then caused this action to be brought and as they are 98% share holder, it would be the major beneficiary of any recovery.
The Court of Appeals held in favor of Amoskeag, primary on the ground that any recovery by the railroad would ultimately benefit the public through improved services.
But Amoskeag alleges no fraud in the purchase transaction and it has suffered no injury or breach of any legal duty owed it yet.
We hold that under traditional principles of equity, Amoskeag is not entitled to a windfall recovery under these circumstances.
Accordingly we reverse the judgment of the Court of Appeals.
Mr. Justice Marshall has filed a dissenting opinion in which Justices Douglas, Brennan and White have joined.