Howard v. Levine, 65 Civ. 2148.
| Court | United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York |
| Writing for the Court | Battle, Fowler, Stokes & Kheel, New York City, for defendant Walter V. Tyminski |
| Citation | 262 F. Supp. 643 |
| Parties | HOWARD v. LEVINE et al. |
| Docket Number | No. 65 Civ. 2148.,65 Civ. 2148. |
| Decision Date | 24 November 1965 |
262 F. Supp. 643
HOWARD
v.
LEVINE et al.
No. 65 Civ. 2148.
United States District Court S. D. New York.
November 24, 1965.
Lawrence Milberg, New York City, for plaintiff.
Battle, Fowler, Stokes & Kheel, New York City, for defendant Walter V. Tyminski.
Mendes & Mount, New York City, for defendants Lybrand, Ross Bros. & Montgomery, a partnership.
Kostelanetz & Ritholz, New York City, for defendant Belock Instrument Corp.
Cahill, Gordon, Reindel & Ohl, New York City, for defendants Stanley R. Grant, Carl M. Loeb, Rhoades & Co., a partnership.
COOPER, District Judge.
These are motions to dismiss a complaint under Rule 12(b) (6), F.R.Civ.P. for failure to state a claim upon which relief can be granted.
The complaint is apparently predicated on Section 10(b) of the Securities Act of 1934, 15 U.S.C. § 78j(b) and Rule 10B-5, 17 C.F.R. 240. 10b-5, the jurisdiction of the Court being invoked under 15 U.S.C. § 78aa.1 In essence, the complaint alleges that Loeb, Rhoades & Co., Belock Instrument and the individual defendants have caused to be circulated and disseminated to the public-at-large financial statements which were gross overstatements because they failed to reflect improper distribution of costs and overcharges in certain government
Rule 10B-5 requires that the alleged fraud or deceit be "in connection with the purchase or sale of any security." As the Court said in Birnbaum v. Newport Steel Corp., 193 F.2d 461, 464 (2d Cir. 1952), "that section 10b was directed solely at that type of misrepresentation or fraudulent practice usually associated with the sale or purchase of securities rather than at fraudulent mismanagement of corporate affairs * *." O'Neill v. Maytag, 339 F.2d 764, 768 (2d Cir. 1964).
The instant complaint is fatally defective for the allegations here do not show the gravamen of defendants' activities to be any wise "in connection with the purchase or sale of any security" as those words have been construed in their statutory setting. Whatever fraud is alleged here (it is in bare skeletal form) is directed against the government, notwithstanding its possible incidental market impact. Furthermore, defendants or persons associated with them did not participate in the security transactions involved. Joseph v. Farnsworth Radio & Television Corp., 99 F. Supp. 701...
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Securities and Exchange Com'n v. Texas Gulf Sulphur Co., No. 296
...Industries, Inc., 259 F. Supp. 99 (S.D.N.Y.1966), appeal pending; Heit v. Weitzen, 260 F.Supp. 598 (S.D.N.Y.1966), Howard v. Levine, 262 F.Supp. 643 (S.D.N.Y.1965), consolidated appeal pending sub nom. Heit v. Weitzen (amicus curiae). The majority opinion appears to approve of the Commissio......
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Drake v. Thor Power Tool Company, No. 65 C 1133.
...cert. den. 365 U.S. 814, 81 S.Ct. 695, 5 L.Ed.2d 693 (1961). Heit v. Weitzen, 260 F.Supp. 598 (S. D.N.Y.1966) and Howard v. Levine, 262 F.Supp. 643 (S.D.N.Y.1965) are not applicable. In these cases, the complaint was dismissed because plaintiff's allegations failed to state a claim for frau......
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Securities & Exch. Com'n v. North American Research & D. Corp., No. 67 Civ. 3724.
...There are cases on both sides of the question in this District, cf. Mooney v. Vitolo, 67 Civ. 1500 (S.D.N.Y.1967); Howard v. Levine, 262 F.Supp. 643 (S.D.N.Y.1965); Heit v. Weitzen, 260 F.Supp. 598 (S.D.N.Y. 1966), with SEC v. Texas Gulf Sulphur Co., 258 F.Supp. 262, 293 (S.D.N.Y.1966). In ......
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Robbins v. Banner Industries, Inc., No. 66 Civ. 2367.
...is "in connection with the purchase or sale of a security." O'Neill v. Maytag, 339 F.2d 764, 768 (2d Cir. 1964); Howard v. Levine, 262 F.Supp. 643 (S.D. N.Y.1965); Heit v. Weitzen, 260 F.Supp. 598 (S.D.N.Y.1966). The only transaction involving the transfer of securities alleged in the compl......
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Securities and Exchange Com'n v. Texas Gulf Sulphur Co., 296
...Industries, Inc., 259 F. Supp. 99 (S.D.N.Y.1966), appeal pending; Heit v. Weitzen, 260 F.Supp. 598 (S.D.N.Y.1966), Howard v. Levine, 262 F.Supp. 643 (S.D.N.Y.1965), consolidated appeal pending sub nom. Heit v. Weitzen (amicus curiae). The majority opinion appears to approve of the Commissio......
-
Drake v. Thor Power Tool Company, 65 C 1133.
...cert. den. 365 U.S. 814, 81 S.Ct. 695, 5 L.Ed.2d 693 (1961). Heit v. Weitzen, 260 F.Supp. 598 (S. D.N.Y.1966) and Howard v. Levine, 262 F.Supp. 643 (S.D.N.Y.1965) are not applicable. In these cases, the complaint was dismissed because plaintiff's allegations failed to state a claim for frau......
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Securities & Exch. Com'n v. North American Research & D. Corp., 67 Civ. 3724.
...There are cases on both sides of the question in this District, cf. Mooney v. Vitolo, 67 Civ. 1500 (S.D.N.Y.1967); Howard v. Levine, 262 F.Supp. 643 (S.D.N.Y.1965); Heit v. Weitzen, 260 F.Supp. 598 (S.D.N.Y. 1966), with SEC v. Texas Gulf Sulphur Co., 258 F.Supp. 262, 293 (S.D.N.Y.1966). In ......
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Robbins v. Banner Industries, Inc., 66 Civ. 2367.
...is "in connection with the purchase or sale of a security." O'Neill v. Maytag, 339 F.2d 764, 768 (2d Cir. 1964); Howard v. Levine, 262 F.Supp. 643 (S.D. N.Y.1965); Heit v. Weitzen, 260 F.Supp. 598 (S.D.N.Y.1966). The only transaction involving the transfer of securities alleged in the compl......