Opinion ID: 316528
Heading Depth: 2
Heading Rank: 2

Heading: The Venue Question

Text: 42 The Fairfield Group asserts a second jurisdictional defect in this action, contending that venue was improperly laid in the Southern District of New York. This argument merits short shrift. The applicable provision of the 1934 Act, 15 U.S.C. 78aa, states in pertinent part: 43 Any suit or action to enforce any liability or duty created by this chapter or rules and regulations thereunder . . . may be brought in any (district wherein any act or transaction constituting the violation occurred) . . .. 44 In this case, ICC claims that a 10(b) violation occurred when it was fraudulently induced to spin-off its Fairfield General subsidiary. An essential element of that fraudulent scheme was the actual mailing of the spin-off dividend to the ICC shareholders. It is uncontroverted that the mailing was performed by ICC's transfer agent, the Marine Midland Bank, from its offices in Manhattan. Accordingly, since 'any use of instrumentalities of the mails or other interstate facilities made within the forum district constituting an important step in . . . (the) consummation (of the fraudulent scheme) is sufficient', Hooper v. Mountain States Securities Corp., 282 F.2d 195, 204-205 (5th Cir. 1960), cert. denied, 365 U.S. 814, 81 S.Ct. 695, 5 L.Ed.2d 693 (1961), venue in the Southern District of New York is proper.