Opinion · Court of Appeals for the Second Circuit

Securities & Exchange Commission v. Boren

Sec. & Exch. Comm’n v. Boren, 283 F.2d 312 (2d Cir. 1960)

Type
Opinion
Court
Court of Appeals for the Second Circuit
Jurisdiction
Federal
Date
1960-10-27
Topic
general

PER CURIAM. Appellant, pending final determination on the merits of the allegations contained in an SEC complaint, was enjoined from . selling shares of the Belmont Oil Corporation in interstate commerce and from obtaining money or property through such sales by means of untrue statements of material facts or by means of omission to state material facts necessary to make these statements not misleading ones. The complaint alleges that the abuses complained of commenced on or about November 7, 1957, when it is undisputed that appellant was involved in the corporation. Also not denied in the reply affidavits are statements in the affidavits of the SEC’s agents as to appellant’s intimate relationship to and knowledge of the operations of Belmont Oil until December 11, 1958. Furthermore, complainant asserts a continuing association thereafter.

Citator

UpLaw has not yet analyzed Securities & Exchange Commission v. Boren. The absence of a flag is not a finding that it is good law.

Cited by
25 opinions
SECURITIES AND EXCHANGE COMMISSION v. BOREN,283 F.2d 312(2nd Cir. 1960)
SECURITIES AND EXCHANGE COMMISSION, Plaintiff-Appellee, v. James B. BOREN,
Defendant-Appellant, and Belmont Oil Corporation, Joel A. Fox, National
Registrar and Transfer Company, Peerless-New York Incorporated, Edward
Cantor, Michael Canter, Morris J. Reiter d/b/a M.J. Reiter Company, Myron
Rosenthal and Howard Stolle d/b/a H.G. Stolle and Company, Carlton
Securities, Inc., David Mandel, Harry Cohen, Abe Bigelison, and The First
National Bank of Wichita Falls, Texas, Defendants. SECURITIES AND EXCHANGE
COMMISSION, Plaintiff-Appellee, v. James B. BOREN, Defendant-Appellant,
and Belmont Oil Corporation, Joel A. Fox, Vince Schwenoha, Helen
Schwenoha, Peerless-New York Incorporated, Morris J. Reiter d/b/a M.J.
Reiter Company, Myron Rosenthal and Howard G. Stolle d/b/a H.G. Stolle and
Company, and Carlton Securities, Inc., Defendants.
Nos. 24-25, Docket Nos. 26105-26106.
United States Court of Appeals, Second Circuit.
Argued October 3, 1960.
Decided October 27, 1960.
Page 313
Thomas G. Meeker, General Counsel, David Ferber, Asst. General Counsel, Theodore Zimmerman, Attorney, Securities and Exchange Commission, Washington, D.C., for plaintiff-appellee.

Moss, Wels Marcus, New York City (Richard H. Wels, James L. Adler, Jr., New York City, of counsel), for defendant-appellant.
Before HINCKS, WATERMAN and MOORE, Circuit Judges.
PER CURIAM.
Appellant, pending final determination on the merits of the allegations contained in an SEC complaint, was enjoined from selling shares of the Belmont Oil Corporation in interstate commerce and from obtaining money or property through such sales by means of untrue statements of material facts or by means of omission to state material facts necessary to make these statements not misleading ones. The complaint alleges that the abuses complained of commenced on or about November 7, 1957, when it is undisputed that appellant was involved in the corporation. Also not denied in the reply affidavits are statements in the affidavits of the SEC's agents as to appellant's intimate relationship to and knowledge of the operations of Belmont Oil until December 11, 1958. Furthermore, complainant asserts a continuing association thereafter. Appellant contends that his connection with Belmont terminated on December 11, 1958, and that, therefore, he was improperly enjoined.

On the motion for a preliminary injunction the district court was not required to irrevocably determine how long appellant had maintained a continuing active interest in the company. It was only necessary for the court to find that the petitioning agency had presented a strong prima facie case to justify the discretionary issuance of the interlocutory restraint. Hamilton Watch Co. v. Benrus Watch Co., 2 Cir., 1953,206 F.2d 738; Bowles v. Montgomery Ward Co., 7 Cir., 1944,143 F.2d 38. Moreover, the cases are clear that a cessation of the alleged objectionable activities by the defendant in contemplation of an SEC suit will not defeat the district court's power to grant an injunction restraining continued activity. See United States v. Parke-Davis Co., 1960,Page 314362 U.S. 503, 80 S.Ct. 503, 4 L.Ed.2d 505; S.E.C. v. Culpepper, 2 Cir., 1959,270 F.2d 241; Otis Co. v. S.E.C., 6 Cir., 1939,106 F.2d 579; S.E.C. v. Universal Service Ass'n, 7 Cir., 1939,106 F.2d 232. S.E.C. v. Torr, 2 Cir., 1937,87 F.2d 446, relied on by appellant, supports this general rule that a discontinuance of objectionable activities is no bar to the issuance of the injunction, though there it was thought that extenuating circumstances should have led the court to deny the motion for the injunction.

Affirmed.