Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

FRENCH v. WILGUS

August 6, 1990

KARAH MARIE FRENCH, a minor who by sues Earl Pickard, her next friend,
v.
J. ROBERT WILGUS and BACHE HALSEY STUART SHIELDS, INC., and PRUDENTIAL-BACHE SECURITIES, INC.



The opinion of the court was delivered by: NIXON

 JOHN T. NIXON, UNITED STATES DISTRICT JUDGE

 Pending before the Court are the Bache Halsey Stuart Shields, Inc., and the Prudential Bache Securities, Inc., defendants' 12(b)(6) motion to dismiss the plaintiff's causes of action brought pursuant to § 17(a) of the Securities Act of 1933, 15 U.S.C. § 77q(a), and the Tennessee Consumer Protection Act, T.C.A. § 47-18-101 et seq. from the plaintiff's amended complaint.

 DISCUSSION

 I. § 17(a) of the Securities Act of 1933

 The defendants move for a dismissal of the plaintiff's claims brought pursuant to § 17(a) of the Securities Act of 1933. In response to the defendants' motion to dismiss, the plaintiff asserts that the plaintiff does not seek an independent recovery from the defendants based upon § 17(a) of the Securities Act of 1933. Because the plaintiff does not bring a claim pursuant to § 17(a) of the Securities Act of 1933, the Court can not dismiss such a claim and therefore the defendants' motion to dismiss is DENIED.

 II. Tennessee Consumer Protection Act

 The defendants move to dismiss the plaintiff's claim under the Tennessee Consumer Protection Act, T.C.A. § 47-18-101 et seq. The defendants rely entirely upon Nichols v. Merrill Lynch, Pierce, Fenner & Smith, 706 F. Supp. 1309 (M.D. Tenn. 1989), and this Court's previous ruling to support their contention that the plaintiff's claim under the Tennessee Consumer Protection Act should be dismissed.

 In deciding Nichols, Judge Higgins wrote that the Tennessee Supreme Court, if it were to confront the issue, would hold that the Tennessee Consumer Protection Act does not apply to securities. 706 F. Supp at 1325. Relying in part upon Nichols, this Court dismissed the plaintiff's claim under the Tennessee Consumer Protection Act from the plaintiff's original complaint.

 The plaintiff responds to the defendant's reliance on Nichols and this Court's previous decision with two arguments. First, the plaintiff argues that a Tennessee court recently interpreted the Tennessee Consumer Protection Act in such an expansive way as to cast doubt upon both the Nichols decision and this Court's previous decision concerning the Tennessee Consumer Protection Act's applicability to securities. Second, the plaintiff contends that Nichols and this Court's previous ruling can be distinguished from the amended complaint. Each of these arguments will be considered in turn.

 
a. The Plaintiff's Argument that a Recent Tennessee Court Opinion Evidences Tennessee's Intent to Make the Tennessee Consumer Protection Act Applicable to Securities

 The plaintiff, however, argues that the claims should not be dismissed for failure to state a claim because since the decision in Nichols and the ruling by this Court, a Tennessee court has held that the Tennessee Consumer Protection Act covers transactions involving securities.

 Indeed, both the Nichols ' court and this Court have indicated that a definitive decision by a Tennessee court that the Tennessee Consumer Protection Act applied to securities might alter the interpretation of the Tennessee Consumer Protection Act's scope of coverage. In Nichols, Judge Higgins wrote that "it should hardly be necessary to say that the Tennessee Supreme Court is not bound by the decisions of the courts of any sister state. It can place Tennessee in a minority of one if it ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.