In the case of Blau v. Lehman et al., 1961, the U.S. Supreme Court ruled on a dispute involving stockholder rights and corporate governance. The plaintiff, Mrs. Edith Blau, was a minority shareholder in Alleghany Corporation who alleged that certain directors had breached their fiduciary duties by approving an unfair merger deal with Investors Diversified Services (IDS). She claimed this action diluted her shares' value and sought to sue on behalf of all similarly affected shareholders without first demanding that the corporation's board take legal action itself against those responsible for the alleged wrongdoing. The court held that under Delaware law - where Alleghany was incorporated - such demand upon directors is not always necessary before filing derivative suits if it would be futile due to potential bias or conflict of interest among them; however, it found no evidence suggesting futility in this particular instance given most board members were independent from IDS at relevant times. Therefore, while acknowledging Mrs. Blau's right as a shareholder to challenge perceived misconduct by company officials through litigation if appropriate conditions are met, it ultimately dismissed her complaint for failing to meet one key procedural requirement: demonstrating why she did not ask Alleghany’s board itself to initiate proceedings before taking matters into her own hands.

In the dissenting opinion for BLAU v. Lehman et al., Justice Frankfurter disagreed with the majority's decision to allow shareholders to sue company directors without first making a demand on the corporation itself. He argued that this approach undermined traditional corporate governance structures and could lead to frivolous lawsuits. According to him, it was essential for shareholders who wished to bring derivative suits against directors or officers of a corporation, must first make an effort in good faith, either formally or informally, asking those managing the corporation’s affairs (the board) before resorting legal action. This requirement would ensure that corporations have an opportunity to address alleged misconduct internally before being subjected to litigation and its associated costs.