SECURITIES & EXCH. COM'N v. CAPITAL GAINS RESEARCH BUR.
| Court | United States Courts of Appeals. United States Court of Appeals (5th Circuit) |
| Citation | 191 F. Supp. 897 |
| Parties | SECURITIES AND EXCHANGE COMMISSION, Plaintiff, v. CAPITAL GAINS RESEARCH BUREAU, INC., Harry P. Schwarzmann, Defendants. |
| Decision Date | 01 March 1961 |
191 F. Supp. 897
SECURITIES AND EXCHANGE COMMISSION, Plaintiff,
v.
CAPITAL GAINS RESEARCH BUREAU, INC., Harry P. Schwarzmann, Defendants.
United States District Court S. D. New York.
March 1, 1961.
Paul Windels, Jr., Regional Administrator, Arthur Goldman, Chief Enforcement Atty., Henry R. Bright, New York City, for Securities and Exchange Commission.
Fennelly, Douglas, Eagon, Nager & Voorhees, New York City, for defendants; Leo C. Fennelly, New York City, of counsel.
DIMOCK, District Judge.
Plaintiff seeks a preliminary injunction against the carrying on of business practices which it alleges contravene the provisions of section 206, subdivisions (1) and (2), of the Investment Advisers Act of 1940, 15 U.S.C. § 80b-6(1) and (2). The entire section 206 as amended in 1960, reads as follows:
"§ 80b-6. Prohibited transactions by investment advisers
"It shall be unlawful for any investment adviser, by use of the mails or any means or instrumentality of interstate commerce, directly or indirectly —
"(1) to employ any device, scheme, or artifice to defraud any client or prospective client;
"(2) to engage in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client;
"(3) acting as principal for his own account, knowingly to sell any security to or purchase any security from a client, or acting as broker for a person other than such client, knowingly to effect any sale or purchase of any security for the account of such client, without disclosing to such client in writing before the completion of such transaction the capacity in which he is acting and obtaining the consent of the client to such transaction. The prohibitions of this paragraph shall not apply to any transaction with a customer of a broker or dealer if such broker or dealer is not acting as an investment adviser in relation to such transaction;
"(4) to engage in any act, practice, or course of business which is fraudulent, deceptive, or manipulative. The Commission shall, for the purposes of this paragraph (4) by rules and regulations define, and prescribe means reasonably designed to prevent, such acts, practices, and courses of business as are fraudulent, deceptive, or manipulative."
Defendant Capital Gains Research Bureau, Inc. is an investment adviser which publishes its advice in widely circulated bulletins and defendant Harry P. Schwarzmann is its president and sole stockholder.
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SECURITIES & EXCH. COM. v. Capital Gains Research Bureau, No. 30
...opposing the application. The District Court upon this proof denied the motion for a preliminary injunction and vacated the stay. 191 F.Supp. 897 (1961). The SEC appealed. A panel of this court affirmed the district court's order. 2 Cir., 300 F.2d 745. A 306 F.2d 608 petition of the SEC for......
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Securities and Exchange Commission v. Capital Gains Research Bureau, Inc, No. 42
...technical sense' and that the Commission had failed to show an intent to injure clients or an actual loss of money to clients. D.C., 191 F.Supp. 897. The Court of Appeals for the Second Circuit, sitting en banc, by a 5-to-4 vote accepted the District Court's limited construction of 'fraud' ......
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Securities and Exchange Commission v. Texas Gulf Sulphur Company, No. 65 Civ. 1182.
...technical common law sense and that the Commission had failed to establish an intent to injure clients or an actual loss to clients. (191 F.Supp. 897, 898.) The Second Circuit Court of Appeals, sitting en banc, affirmed the district court by a 5-to-4 vote. (306 F.2d In reversing, the Suprem......
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SECURITIES & EXCH. COM. v. Capital Gains Research Bureau, No. 30
...opposing the application. The District Court upon this proof denied the motion for a preliminary injunction and vacated the stay. 191 F.Supp. 897 (1961). The SEC appealed. A panel of this court affirmed the district court's order. 2 Cir., 300 F.2d 745. A 306 F.2d 608 petition of the SEC for......
-
Securities and Exchange Commission v. Capital Gains Research Bureau, Inc, No. 42
...technical sense' and that the Commission had failed to show an intent to injure clients or an actual loss of money to clients. D.C., 191 F.Supp. 897. The Court of Appeals for the Second Circuit, sitting en banc, by a 5-to-4 vote accepted the District Court's limited construction of 'fraud' ......
-
Securities and Exchange Commission v. Texas Gulf Sulphur Company, No. 65 Civ. 1182.
...technical common law sense and that the Commission had failed to establish an intent to injure clients or an actual loss to clients. (191 F.Supp. 897, 898.) The Second Circuit Court of Appeals, sitting en banc, affirmed the district court by a 5-to-4 vote. (306 F.2d In reversing, the Suprem......