Reference no: EM131660733

Question: Inspection Rights. Craig Johnson founded Distributed Solutions, Inc. (DSI), in 1991 to make software and provide consulting services, including payroll services, for small companies. Johnson was the sole officer and director and the majority shareholder. Jeffrey Hagen was a minority shareholder. In 1993, Johnson sold DSI's payroll services to himself and a few others and set up Distributed Payroll Solutions, Inc. (DPSI). In 1996, DSI had revenues of $739,034 and assets of $541,168. DSI's revenues in 1997 were $934,532. Within a year, however, all of DSI's assets were sold, and Johnson told Hagen that he was dissolving the firm because, among other things, it conducted no business and had no prospects for future business. Hagen asked for corporate records to determine the value of DSI's stock, DSI's financial condition, and "whether unauthorized and oppressive acts had occurred in connection with the operation of the corporation which impacted the value of" the stock. When there was no response, Hagen filed a suit in an Illinois state court against DSI and Johnson, seeking an order to compel the inspection. The defendants filed a motion to dismiss, arguing that Hagen had failed to plead a proper purpose. Should the court grant Hagen's request? Discuss. [Hagen v. Distributed Solutions, Inc., 328 Ill.App.3d 132, 764 N.E.2d 1141, 262 Ill.Dec. 24 (1 Dist. 2002)]