Cardea Corporate Holdings, Inc.v.Carolyn Larocco
Carolyn LaRocco, a shareholder and former executive of an affiliated company, demanded access to Cardea Corporate Holdings’ books and records after her employment ended. She filed an application to compel inspection, and the superior court granted it and awarded costs without first giving Cardea an opportunity to respond. Cardea argued that the procedure violated its statutory and due-process rights. The Court of Appeals of Georgia held that a corporation facing an application to compel inspection is entitled to reasonable notice and an opportunity to prepare and present defenses before the court orders production and costs. The inspection statutes governing for-profit and nonprofit corporations use materially similar language, so the court applied the same procedural protection to Cardea. It vacated the order compelling inspection and remanded for proceedings consistent with the opinion. The appellate court did not decide the underlying merits of LaRocco’s demand or the remaining disputes among the parties.
Loading published copy…

