Greenstein v. Paul, 400 F.2d 580 (2d Cir. 1968). · Go Syfert
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Greenstein v. Paul, 400 F.2d 580 (2d Cir. 1968). Cases Citing This Book View Copy Cite
98 citation events across 22 distinct courts.
Strongest positive: Molasky v. Garfinkle (nysd, 1974-07-24) · Strongest negative: Fed. Sec. L. Rep. P 93,718 Glen J. Travis v. Anthes Imperial Limited (ca8, 1973-01-12)
Treatment trajectory · 1968 → 2026 · click a year to view as-of
1968 1997 2026
Top citers, strongest first. 23 distinct citers. How cited ↗
discussed Cited "but see" Fed. Sec. L. Rep. P 93,718 Glen J. Travis v. Anthes Imperial Limited
8th Cir. · 1973 · signal: but see · confidence high
But see, Green-stein v. Paul, 400 F.2d 580 (2nd Cir. 1968). 13 Defendants Molson and Anthes argue that it is improper to call the plaintiffs “forced sellers” because they gave the plaintiffs an opportunity to exchange their Anthes stock for Molson Class A stock and cash.
discussed Cited as authority (rule) Molasky v. Garfinkle
S.D.N.Y. · 1974 · confidence medium
NOTES [1] 15 U.S.C. § 78j(b) (1970). [2] 15 U.S.C. § 78m(e)(1) (1970). [3] 17 C.F.R. § 240 .10b-5 (1973). [4] 15 U.S.C. § 77q(a) (1970). [5] 193 F.2d 461 (2d Cir.), cert. denied, 343 U.S. 956 , 72 S.Ct. 1051 , 93 L.Ed. 1356 (1952). [6] Entel v. Allen, 270 F.Supp. 60, 69-70 (S. D.N.Y.1967). [7] See, e. g., Leech, Transactions in Corporate Control, 104 U.Pa.L.Rev. 725, 832-35 (1956); Lowenfels, The Demise of the Birnbaum Doctrine: A New Era for Rule 10b-5, 54 Va.L.Rev. 268, 275-77 (1968). [8] Eason v. General Motors Acceptance Corp., 490 F.2d 654 (7th Cir. 1973). [9] See Haberman v. Murchiso…
discussed Cited as authority (rule) Molasky v. Garfinkle
S.D.N.Y. · 1974 · confidence medium
See Haberman v. Murchison, 468 F.2d 1305, 1311-1313 (2d Cir. 1972) ; GAF Corp. v. Milstein, 453 F.2d 709, 721 (2d Cir. 1971), cert. denied, 406 U.S. 910 , 92 S.Ct. 1610 , 31 L.Ed.2d 821 (1972) ; Iroquois Industries, Inc. v. Syracuse China Corp., 417 F.2d 963, 967-970 (2d Cir. 1969), cert. denied, 399 U.S. 909 , 90 S.Ct. 2199 , 26 L.Ed.2d 561 (1970) ; Greenstein v. Paul, 400 F.2d 580, 581 (2d Cir. 1968) ; cf. International Controls Corp. v. Vesco, 490 F.2d 1334 , 1346 n. 16 (2d Cir. 1974) ; Mutual Shares Corp. v. Genesco, Inc., 384 F.2d 540, 546 (2d Cir. 1967).
discussed Cited as authority (rule) Ingenito v. Bermec Corporation
S.D.N.Y. · 1974 · confidence medium
See Haberman v. Murchison, 468 F.2d 1305, 1311 (2d Cir. 1972); Iroquois Industries, Inc. v. Syracuse China Corp., 417 F.2d 963, 967, 970 (2d Cir. 1969), cert. denied, 399 U.S. 909 , 90 S.Ct. 2199 , 26 L.Ed.2d 561 (1970); Greenstein v. Paul, 400 F.2d 580, 581 (2d Cir. 1968); O’Neill v. Maytag, 339 F.2d 764 (2d Cir. 1964); Landy v. Federal Deposit Insurance Co., 486 F.2d 139 (3d Cir. 1973); Mount Clemens Industries, Inc. v. Bell, 464 F.2d 339 (9th Cir. 1972); City National Bank v. Vanderboom, 422 F.2d 221 (8th Cir.) cert. denied, 399 U.S. 905 , 90 S.Ct. 2196 , 26 L.Ed.2d 560 (1970).
discussed Cited as authority (rule) Getter v. R. G. Dickinson & Co.
S.D. Iowa · 1973 · confidence medium
Bank v. Vanderboom, 422 F.2d 221 , 228-229 (8th Cir. 1970); Vanderboom v. Sexton, 422 F.2d 1233, 1243 (8th Cir. 1970); Erling v. Powell, 298 F.Supp. 1154, 1156 (D.S.D.1969), aff’d., 429 F.2d 795 , 797-799 (8th Cir. 1970); Greenstein v. Paul, 400 F.2d 580, 581 (2d Cir. 1968); Iroquois Industries, Inc. v. Syracuse China Corp., 417 F.2d 963, 966 (2d Cir. 1969), cert. denied, 399 U.S. 909 , 90 S.Ct. 2199 , 26 L.Ed.2d 561 (1970); Kahan v. Rosenstiel, 424 F.2d 161, 173 (3d Cir. 1970); Landy v. F. D.
discussed Cited as authority (rule) Harold DRACHMAN and Claire Drachman, Plaintiffs-Appellants, v. Lawrence A. HARVEY Et Al., Defendants-Appellees (2×)
2d Cir. · 1972 · confidence medium
See, e. g., Iroquois Industries Inc. v. Syracuse China Corp., 417 F.2d 963, 967 (2d Cir. 1969); Greenstein v. Paul, 400 F.2d 580, 581 (2d Cir. 1968).
discussed Cited as authority (rule) Dyer v. Eastern Trust and Banking Company
D. Me. · 1971 · confidence medium
Birnbaum v. Newport Steel Corp., 193 F.2d 461 (2d Cir.), cert. denied, 343 U.S. 956 , 72 S.Ct. 1051 , 96 L.Ed. 1356 (1952); Herpich v. Wallace, 430 F.2d 792, 803-807 (5th Cir. 1970); Supt. of Insurance of the State of New York v. Bankers Life and Casualty Co., 430 F.2d 355, 359-360 (2d Cir. 1970), rev’d on other grounds, 404 U.S. 6 , 92 S.Ct. 165 , 30 L.Ed.2d 128 (1971); Simmons v. Wolfson, 428 F.2d 455, 456 (6th Cir. 1970), cert. denied, 400 U.S. 999 , 91 S.Ct. 459 , 27 L.Ed. 2d 450 (1971); Rekant v. Desser, 425 F.2d 872, 877 (5th Cir. 1970); Iroquois Industries, Inc. v. Syracuse China Corp…
discussed Cited as authority (rule) Fed. Sec. L. Rep. P 93,116 George E. Dudley, Receiver for Insurance Investors Trust Company v. Southeastern Factor and Finance Corporation
5th Cir. · 1971 · confidence medium
See Iroquois Industries, Inc. v. Syracuse China Corporation, 417 F.2d 963 (C.A.2, 1969), cert. denied, 399 U.S. 909 , 90 S.Ct. 2199 , 26 L.Ed.2d 561 (1970); Greenstein v. Paul, 400 F.2d 580, 581 (C.A.2, 1968).
discussed Cited as authority (rule) Erling v. Powell
8th Cir. · 1970 · confidence medium
The absence of a similar provision in Section 10(b) strengthens the conclusion that that section 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, and that Rule X-10B-5 extended protection only to the defrauded purchaser or seller, 193 F.2d at 463-464 . 3 The Second Circuit continues to follow Birnbaum-, its most recent affirmations coming in Iroquois Industries, Inc. v. Syracuse China Corporation, 417 F.2d 963 , 966 (1969), cert. denied, 399 U.S. …
discussed Cited as authority (rule) Erling v. Powell
8th Cir. · 1970 · confidence medium
The absence of a similar provision in Section 10(b) strengthens the conclusion that that section 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, and that Rule X-10B-5 extended protection only to the defrauded purchaser or seller, 193 F.2d at 463-464 . 3 8 The Second Circuit continues to follow Birnbaum ; its most recent affirmations coming in Iroquois Industries, Inc. v. Syracuse China Corporation, 417 F.2d 963 , 966 (1969), cert. denied, 399 U.S…
discussed Cited as authority (rule) Superintendent of Insurance of New York v. Bankers Life & Casualty Co.
2d Cir. · 1970 · confidence medium
Greenstein v. Paul, 400 F.2d 580, 581 (2d Cir. 1968); Birnbaum v. Newport Steel Corp., 193 F.2d 461, 463 (2d Cir.), cert. denied, 343 U.S. 956 , 72 S.Ct. 1051 , 96 L.Ed. 1356 (1952) ; see Christophides v. Porco, 289 F.Supp. 403, 406 (S.D.N.Y.1968). 8 Bankers Life was the seller of the Manhattan stock; Begole the purchaser.
discussed Cited as authority (rule) Superintendent of Insurance of State of New York v. Bankers Life and Casualty Company
2d Cir. · 1970 · confidence medium
Greenstein v. Paul, 400 F.2d 580, 581 (2d Cir. 1968); Birnbaum v. Newport Steel Corp., 193 F.2d 461, 463 (2d Cir.), cert. denied, 343 U.S. 956 , 72 S.Ct. 1051 , 96 L.Ed. 1356 (1952); see Christophides v. Porco, 289 F.Supp. 403, 406 (S.D.N.Y.1968). 8 Bankers Life was the seller of the Manhattan stock; Begole the purchaser.
discussed Cited as authority (rule) Claude E. Shell v. Milford E. Hensley, Jack E. Love v. Milford E. Hensley
5th Cir. · 1970 · confidence medium
Grooms, determined that an immediate appeal from his order overruling defendants’ motions to dismiss the complaint might materially advance the ultimate termination of this litigation in light of the decisions in Herpich v. Wilder, M.D.Ala., 1969 [Civ.No. 2747-N, January 14], rev’d, 5 Cir., 1970, 430 F.2d 818 , and Greenstein v. Paul, 2 Cir., 1968, 400 F.2d 580 .
discussed Cited as authority (rule) Kahan v. Rosenstiel (2×) also: Cited "see"
D. Del. · 1969 · confidence medium
N.Y.1967), which anticipates a change in the Birnbaum rule, is not authority to the contrary in light of Greenstein v. Paul, supra 400 F.2d at 581.
discussed Cited "see" Boardman v. Lipton
S.D.N.Y. · 1985 · signal: see · confidence high
See Greenstein v. Paul, 400 F.2d 580 (2d Cir.1968) (non-selling stockholder had no cause of action where defendants’ allegedly conspired to depress value of corporations stock to effectuate a “freeze-out” of minority shareholders.) Boardman cites three cases in support of his allegation that he has met the statutory requirements.
cited Cited "see" Koppel v. Wien
S.D.N.Y. · 1983 · signal: see · confidence high
See Greenstein v. Paul, 400 F.2d 580, 581-82 (2d Cir.1968) (“when this merger is carried out, if it even is, the Vine case will be in point.
cited Cited "see" Heyman v. Heyman
S.D.N.Y. · 1973 · signal: see · confidence high
See Greenstein v. Paul, 400 F.2d 580 (2d Cir. 1968); Hogan v. Teledyne, Inc., 328 F.Supp. 1043 (N.D.Ill.1971).
cited Cited "see" Seligson v. Plum Tree, Inc.
E.D. Pa. · 1972 · signal: see · confidence high
See Greenstein v. Paul, 275 F.Supp. 604 (S.D.N.Y.1967), aff’d., 400 F.2d 580 (C.A.2, 1968).
cited Cited "see, e.g." Rich v. Touche Ross & Co.
S.D.N.Y. · 1976 · signal: see, e.g. · confidence low
See, e.g., Greenstein v. Paul, 400 F.2d 580 (2d Cir. 1968); Pollak v. Eastman Dillon, [1974-75] CCH Fed.Sec.L.Rep. ¶94,987 (S.D.N.Y.1975); Molasky v. Garfinkle, 380 F.Supp. 549 (S.D.N.Y.1974).
cited Cited "see, e.g." Bolger v. Laventhol, Krekstein, Horwath & Horwath
S.D.N.Y. · 1974 · signal: see, e.g. · confidence low
See, e. g., Greenstein v. Paul, 400 F.2d 580 (2d Cir. 1968); Mutual Shares Corp. v. Genesco, Inc., 384 F.2d 540 (2d Cir. 1967) ; In re R.
discussed Cited "see, e.g." Oppenlander v. Standard Oil Co.
D. Colo. · 1974 · signal: see, e.g. · confidence low
See e. g., Greenstein v. Paul, 400 F.2d 580 (2d Cir. 1968); Dyer v. Eastern Trust and Banking Co., Fed.Sec.L.Rep. ¶¶ 93,329 at p. 91,774 (D.Me.1971); Emmi v. First-Manufacturers National Bank, Fed.Sec.L.Rep. ¶ 93,330 at p. 91,-784 (D.Me.1971). k) Whether one or more claims of the plaintiffs and the plaintiff class were barred by the statute of limitations or by laches.
cited Cited "see, e.g." Weiner v. Bank of King of Prussia
E.D. Pa. · 1973 · signal: see also · confidence low
See also, Greenstein v. Paul, 275 F.Supp. 604, 605 (S.D.N.Y.1967), aff’d, 400 F.2d 580 (2d Cir. 1968).
cited Cited "see, e.g." Feldman v. Hanley
S.D.N.Y. · 1973 · signal: see, e.g. · confidence low
See, e.g., Greenstein v. Paul, 400 F.2d 580 (2d Cir. 1968); Shulof v. Merrill Lynch, Pierce, Fenner & Smith, Inc., [1970-1971 Transfer Binder] CCH Fed.Sec.L.Rep. ¶[ 93,147, at 91, 132 (S.D.
Retrieving the full opinion text from the archive…
Max Greenstein
v.
Mildred P. Paul, Harry Lebensfeld, Jack Koenig, Joseph A. Dancewicz, United Industrial Syndicate, Inc., and Sagamore Manufacturing Company
31965.
Court of Appeals for the Second Circuit.
Aug 30, 1968.
400 F.2d 580
Cited by 12 opinions  |  Published

400 F.2d 580

Max GREENSTEIN, Plaintiff-Appellant,
v.
Mildred P. PAUL, Harry Lebensfeld, Jack Koenig, Joseph A.
Dancewicz, United Industrial Syndicate, Inc., and
Sagamore Manufacturing Company,
Defendants-Appellees.

No. 31965.

United States Court of Appeals Second Circuit.

Argued April 4, 1968.
Decided Aug. 30, 1968.

Louis C. Fieland, New York City, for plaintiff-appellant.

Edward Brodsky, New York City, Goldstein, Judd & Gurfein, Appel & Goldman, William M. Guttman and Ronald Appel, New York City, of counsel, for defendants-appellees.

Before MOORE, WOODBURY[1] and SMITH, Circuit Judges.

WOODBURY, Senior Circuit Judge:

[*~580]1

The plaintiff brought this action individually, and as the representative of all other stockholders of Sagamore Manufacturing Company similarly situated, for an accounting, damages and other appropriate relief, charging the defendants with violating 10(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78j(b)) and Rule 10b-5 of the Securities and Exchange Commission thereunder as well as their fiduciary obligations under common law. Jurisdiction of the district court is invoked solely under 27 of the above Act. 15 U.S.C. 78aa.

2

The individual defendants are alleged to be the stockholders and the officers and directors of the defendant United Industrial Syndicate, Inc., a New York corporation alleged to own at the time the complaint was filed 80% Or more of the stock of the defendant Sagamore, a Massachusetts corporation. The individual defendants are alleged to be also the directors and officers of Sagamore. They are charged in the complaint with conspiring with one another to syphon the assets and income of Sagamore into Syndicate for its use, depressing the market value of Sagamore's stock below its fair value on the over-the-counter market where the stock was traded, so as to purchase shares of the minority stockholders at depressed prices and effectuate their 'freeze-out.'

3

The court below granted the defendants' motion for summary judgment on the ground that the complaint failed to allege, and indeed an undisputed affidavit established that the plaintiff had not sold any of his Sagamore stock during the time when the defendants committed the alleged wrongs but in fact acquired his stock prior to the acts of the defendants of which he complains and had never parted with any of it. The question then is whether there must be a sale of stock by a plaintiff before he can invoke the implied civil remedy afforded by the Act and Rule cited hereinabove. See Mutual Shares Corp. v. Genesco, Inc., 384 F.2d 540, 543 (C.A. 2, 1967), citing J. I. Case Co. v. Borak, 377 U.S. 426, 84 S.Ct. 1555, 12 L.Ed.2d 423 (1964).

4

It has long been the rule in this circuit that to maintain an action under 10(b) of the Act and Rule 10b-5 of the Securities and Exchange Commission the plaintiff must have been a seller of the stock involved. Birnbaum v. Newport Steel Corp., 193 F.2d 461 (C.A. 2, 1952), cert. denied 343 U.S. 956, 72 S.Ct. 1051, 96 L.Ed. 1356 (1952). Although criticized, Entel v. Allen, 270 F.Supp. 60, 70 (S.D.N.Y., 1967), it is still the rule at least insofar as actions for damages are concerned. Mutual Shares Corp v. Genesco, Inc., supra.

5

Vine v. Beneficial Finance Co., 374 F.2d 627 (C.A. 2, 1967), cert. denied 389 U.S. 970, 88 S.Ct. 463, 19 L.Ed.2d 460 (1967), upon which the plaintiff heavily relies, does not hold the contrary. This court in that case adhered to the earlier rule in the circuit but held that a minority stockholder of a corporation merged with another under the mechanics of a short form merger was in fact a 'seller' of his stock because after merger, although he still had possession of his certificates, he had no choice but either to convert them to cash at the price fixed by the terms of the merger or else to have them appraised unless, of course, he chose to hold stock in a nonexistent corporation.

6

In the case at bar the minority stockholders of Sagamore were advised by notice dated August 1, 1966, that the Directors of Syndicate had adopted resolutions to merge Sagamore into it and assume all its obligations, and that thereafter Sagamore would operate as a division of Syndicate. Had this merger been carried out the Vine case would be in point. But it was not. By notice dated September 29, 1966, the remaining stockholders of Sagamore were advised that Syndicate's directors had decided to abandon for the time being any proposed merger with Sagamore, although it was their intention to effect this merger at some later date.

7

When this merger is carried out, if it ever is, the Vine case will be in point. Until that event under existing law in this circuit the plaintiff is not a seller and cannot invoke the civil remedy afforded by the Act and Rule. His recourse is to the minority stockholders' derivative action which he has brought and which is now pending in the Supreme Court of the State of New York.

[*~581]8

Affirmed.

1

Of the First Circuit, sitting by designation