Louis Brandeis

“ A judgment creditor's bill is in essence an equitable execution comparable to proceedings supplementary to execution. See Ex parte Boyd, 105 U.S. 647, 26 L. Ed. 1200. The law which sends a corporation into the world with the capacity to act imposes upon its assets liability for its acts. The corporation cannot disable itself from responding by distributing its property among its stockholders and leaving remediless those having valid claims. In such a case the claims after being reduced to judgments may be satisfied out of the assets in the hands of the stockholders. ”

“ It has been held that in litigations between private parties a creditor's bill cannot be maintained in a federal court upon a judgment recovered in a state other than that in which suit is brought (National Tube Works v. Ballou, 146 U.S. 517, 523, 13 Sup. Ct. 165, 36 L. Ed. 1070) , and that a return unsatisfied of the execution issued on the judgment sued on is held essential to the maintenance of the creditor's suit (Taylor v. Bowker, 111 U.S. 110, 4 Sup. Ct. 397, 28 L. Ed. 368) . But this strict rule is not applicable where the United States is the judgment creditor. ”

“ But when a corporation divests itself of all its assets by distributing them among the stockholders, those having unsatistied claims against it may follow the assets, although the claims were contested and unliquidated at the time when the assets were distributed. It is true that the bill a reach and apply the assets distributed among the stockholders cannot, as a matter of equity jurisdiction and procedure, be filed until the claim has been reduced to judgment and the execution thereon has been returned unsatisfied. ”