Question

Ariana is an officer of New Stage, a theater production company. Without telling any other officers or the board of directors, she decides that New Stage should try to sell gardening tools over the Internet. She makes contracts with suppliers and a Web-based remote-order-fulfillment company. The only action that may not be taken is_____

a. the shareholders can file a lawsuit on behalf of the corporation.
b. she can file a lawsuit against the corporation for damages.
c. the corporation can file a lawsuit against her for damages.
d. the state attorney general may seek an injunction against the transactions or seek a dissolution order from a court.

Answer 1

b. she can file a lawsuit against the corporation for damages.

Step-by-step explanation:

Ariana cannot afford to file a lawsuit against the corporation because the corporation was not duly informed of her actions. She was expected to seek the consent of the board of Directors before deciding to trade on the web. Failure to do so constitutes gross misconduct.