UPDATE 1-Stronach firm faces complaint by minority holders

* Hearing scheduled for Sept. 9

* Minority shareholder say rights violated

* MID says application for hearing is "without merit"

(In U.S. dollars except where noted)

TORONTO, Aug 11 (Reuters) - Ontario regulators on Tuesday called a hearing to look into whether a real estate company controlled by Canadian auto parts magnate Frank Stronach violated the rights of its minority shareholders.

The application for the Ontario Securities Commission hearing came from Greenlight Capital, along with other minority shareholders in MI Developments MIMa.TO, the property arm of Magna International Inc MGa.TO. The hearing is scheduled for Sept. 9.

The dispute involves loans and attempts to purchase assets by MID from its debt-laden Magna Entertainment MECAQ.PK (MEC) subsidiary, owner of Maryland's Pimlico and other racetracks. MEC, which is also controlled by Stronach, is currently operating under bankruptcy protection in the United States.

Greenlight, a New York investment fund, said in its application that MID failed to get approval from minority shareholders for the transactions, violating OSC regulations.

MID said in a statement that it "believes that the application of the MID Class A shareholders is without merit and MID will vigorously defend against the application."

MEC, which owns the Pimlico Race Course that hosts the Preakness Stakes, plans to auction off some of its key assets as part of its bankruptcy process.

When MEC filed for Chapter 11 bankruptcy protection, it said it had $1.05 billion in assets and $958.6 million in debt.

Greenlight has long been opposed to MID sinking cash into MEC, saying that Stronach unfairly benefited from the transactions.

Greenlight has asked the OSC to deny MID any exemptions from regulations protecting minority shareholders if it tries to purchase any of MEC's assets.

MID said it has not not made any decisions about participation in transactions with MEC at this time and that it will continue to evaluate whether to do so during the course of MEC's Chapter 11 process.

Shares of MID ended down 30 Canadian cents, or 2.5 percent, at C$11.65 on the Toronto Stock Exchange on Tuesday.

Stronach's Magna International is currently bidding for General Motors Co's [GM.UL] Opel unit in Europe. ($1=$1.10 Canadian) (Reporting by John McCrank; Editing by Frank McGurty)