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Kaufman v. Amtax Planning Corp.

669 F. Supp. 573 (S.D.N.Y. 1986)
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Kaufman v. Amtax Planning Corp.

7 Citing cases

  1. Wexner v. First Manhattan Co.

    902 F.2d 169 (2d Cir. 1990)   Cited 359 times
    Holding that "[d]espite the generally rigid requirement that fraud be pleaded with particularity, allegations may be based on information and belief when facts are peculiarly within the opposing party's knowledge," but noting that "[t]his exception to the general rule must not be mistaken for license to base claims of fraud on speculation and conclusory allegations"

    See L. Loss, supra, at 1148-50; R. Jennings H. Marsh, Securities Regulation 890-892 (6th ed. 1987). Numerous district courts of the Circuit have concluded, notwithstanding Kirshner, that no private cause of action can be implied from section 17(a). See, e.g., Dymm v. Cahill, 730 F.Supp. 1245 (S.D.N.Y. 1990); Dale v. Prudential-Bache Sec., Inc., 719 F.Supp. 1164, 1166-67 (E.D.N.Y. 1989); Tobias v. First City Nat'l Bank Trust Co., 709 F.Supp. 1266, 1274-76 (S.D.N.Y. 1989); Griffin v. McNiff, [1989 Transfer Binder] Fed.Sec.L.Rep. (CCH) ¶ 94,389, 1989 WL 80451 (S.D.N.Y. March 13, 1989); Lazzaro v. Manber, 701 F.Supp. 353, 365-66 (E.D.N.Y. 1988); Boley v. Pineloch Associates, 700 F.Supp. 673, 677-78 (S.D.N.Y. 1988); Bruce v. Martin, 691 F.Supp. 716, 724-26 (S.D.N.Y. 1988); SSH Co. v. Shearson Lehman Bros., Inc., 678 F.Supp. 1055, 1058-59 (S.D.N.Y. 1987); Anderson v. Lowrey, 667 F.Supp. 105, 109-10 (S.D.N.Y. 1987); Cohen v. Goodfriend, 665 F.Supp. 152, 155-56 (E.D.N.Y. 1987); Kaufman v. Amtax Planning Corp., 669 F.Supp. 573, 576 (S.D.N.Y. 1986); Ackerman v. Clinical Data, Inc., No. 84 Civ. 5400, 1985 WL 1884 (S.D.N.Y. July 11, 1985) (LEXIS, Genfed library, Dist file). It is apparent that the vitality of our holding in Kirshner is in doubt, and the existence of a private right of action under section 17(a) is in need of re-examination. Nevertheless, in light of our determination that the district court should be affirmed on other grounds, we find it neither necessary nor appropriate to reach this issue today.

  2. Shochat v. Weisz

    797 F. Supp. 1097 (E.D.N.Y. 1992)   Cited 2 times
    Explaining that under New York law "[g]enerally, one who signs a written instrument is conclusively bound by its terms," even if one fails to read the document

    " Moreover, the Court noted that "[t]he mere allegations that the tax benefits of [the shelter] were later disallowed by the IRS does not, in itself, raise a claim of fraudulent misstatement." ( Id. [citing Kaufman v. Amtax Planning Corp., 669 F. Supp. 573, 576 (S.D.N.Y. 1986)]). A plaintiff must show that, for example, "defendants never intended the investments to yield a tax advantage at all," or that the accountant-defendant knew in advance or had a basis for knowing that the shelter would not materialize.

  3. Eickhorst v. Am. Completion and Dev't.

    706 F. Supp. 1087 (S.D.N.Y. 1989)   Cited 22 times
    In Eickhorst v. Am. Completion and Dev. Corp., 706 F. Supp. 1087 (S.D.N.Y. 1989), however, the district court concluded that the reasoning of Data Access was inapplicable in this circuit, and, in any event, that Malley-Duff did not compel the result reached in Data Access.

    In fact, there has recently been a steady stream of opinions by district court judges in this Circuit which have found it appropriate to reexamine Kirshner and which have concluded that section 17(a) does not authorize a private right of action. See Stevens v. Equidyne Extractive Industries 1980, supra, 694 F. Supp. 1057 [Current Binder] Fed.Sec.L.Rep. (CCH) ¶ 93,959, at 90,456 (S.D.N.Y. July 28, 1988); Boley v. Pineloch Associates, Ltd., 700 F. Supp. 673 (S.D.N.Y. 1988); The Limited, Inc. v. McCory Corp., supra, 683 F. Supp. at 395-97; Center Savings Loan Assoc. v. Prudential-Bache Securities, Inc., 679 F. Supp. 274, 278-79 (S.D.N.Y. 1988); SSH Co., Ltd. v. Shearson Lehman Brothers Inc., 678 F. Supp. 1055, 1059 (S.D.N.Y. 1987); Anderson v. Lowrey, 667 F. Supp. 105, 109-110 (S.D.N.Y. 1987); Beres v. Thompson McKinnon Securities, Inc., [1987 Transfer Binder] Fed.Sec.L.Rep. (CCH) ¶ 93,395, at 97,071-72 (S.D.N.Y. 1987) [1987 WL 16977]; Kaufman v. Amtax Planning Corp., 669 F. Supp. 573, 576 (S.D.N.Y. 1986). Judge Haight's thorough review of this issue led him to firmly conclude that " Kirshner was no longer controlling authority. . . . and that there is no implied private right of action under § 17."

  4. Federal Ins. Co. v. Mallardi

    696 F. Supp. 875 (S.D.N.Y. 1988)   Cited 12 times
    Allowing discovery into relationship between bank raising waiver and party obtaining guarantee

    C. Section 17 Claims We decline third-party plaintiffs' invitation to reconsider our ruling in Kaufman v. Amtax Planning Corp. (S.D.N.Y. 1986) 669 F. Supp. 573, 576. We there held that no implied private right of action exists under § 17. That claim is therefore dismissed.

  5. Boley v. Pineloch Associates, Ltd.

    700 F. Supp. 673 (S.D.N.Y. 1988)   Cited 42 times
    Holding that allegation that "defendants entered into a fiduciary relationship of trust and confidence with plaintiffs" was "a conclusory allegation" that "does not satisfy Rule 8."

    Indeed, several courts in the Southern District have held that no private right of action exists under § 17(a). See, e.g., Anderson v. Lowrey, 667 F. Supp. 105, 110 (S.D.N.Y. 1987); Kaufman v. Amtax Planning Corp., 669 F. Supp. 573, 576 (S.D.N.Y. 1986); Ackerman v. Clinical Data, Inc., [1985-1986 Transfer Binder] Fed.Sec.L.Rep. (CCH) ¶ 92,207 (S.D.N.Y. 1985) [1985 WL 1884].

  6. Anderson v. Lowrey

    667 F. Supp. 105 (S.D.N.Y. 1987)   Cited 14 times
    In Anderson v. Lowrey, 667 F. Supp. 105, 109-10 (S.D.N.Y. 1987), this Court reconsidered whether a private right of action existed under Section 17(a) and, based upon recent authority, determined that it did not.

    Applying this test and in light of the holdings in Aaron and Yoder, several courts in this district recently have determined that no private right of action exists under section 17. See Ackerman v. Clinical Data, Inc., [1985-86] Fed.Sec.L.Rep. (CCH) ¶ 92,207 (S.D.N.Y. 1985); Kaufman v. Amtax Planning Corp., 669 F. Supp. 573 (S.D.N.Y. 1986); see also, e.g., Eriksson v. Galvin, 484 F. Supp. 1108, 1127 (S.D.N.Y. 1980) and cases cited therein; Mauersberg v. E.F. Hutton Co., 116 A.D.2d 417, 501 N.Y.S.2d 748 (1st Dept. 1986). Upon reconsidering this question in the absence of the unique circumstances of a multidistrict litigation, see In re Gas Reclamation, Inc. Securities Litigation, 659 F. Supp. 493 (S.D.N.Y. 1987) (Sand, J.), we are persuaded by the reasoning of the recent and ever-increasing authority to the effect that there is no such private right.

  7. In re Gas Reclamation, Inc. Securities

    659 F. Supp. 493 (S.D.N.Y. 1987)   Cited 89 times
    Holding that allegations that defendant accounting firm knew of alleged fraud and failed to disclose it or otherwise stop scheme failed to state an aiding-abetting claim

    Upon conducting this reexamination, some of the lower courts in this district have ruled that the Kirshner holding is no longer valid and that no private cause of action exists under section 17. See, eg., Ackerman v. Clinical Data, Inc., [1985-86] Fed.Sec.L.Rep. (CCH) ¶ 92,207 (S.D.N.Y. 1985) [Available on WESTLAW, DCT database]; Kaufman v. Amtax Planning Corp., slip op., 85 Civ. 4520 (S.D.N.Y. June 30, 1986). While Rule 10b-5 and section 17 offer plaintiffs the same relief, Yoder, 751 F.2d at 559 n. 3, these courts have concluded that sections 10(b) and 17 can be meaningfully distinguished.