Opinion ID: 485239
Heading Depth: 1
Heading Rank: 4

Heading: Registration of Limited Partnership Under Massachusetts Securities Act

Text: 46 The Massachusetts Securities Act provides that: 47 It is unlawful for any person to sell any security in the commonwealth unless (1) it is registered under this chapter or (2) the security or transaction is exempted under section 402. 48 Mass.Gen.Laws ch. 110A, Sec. 301. Section 402(b)(9), a private placement provision, allows an exemption for unregistered securities if the security is offered to less than twenty-five qualified persons for investment purposes only and if, five days after filing for the exemption, the state secretary does not disallow it. It is undisputed that Josephthal filed for the 402(b)(9) exemption and the secretary did not disallow the exemption. 49 Appellants argue that certain persons to whom the security was offered were not qualified, in that they did not hold the partnership units for investment purposes. However, appellants have pointed to nothing tending to demonstrate that Josephthal, in the words of section 402(b)(9), did not reasonably believe[ ] that all the buyers ... [were] purchasing for investment. Thus, appellants failed to create a genuine issue of material fact and the grant of summary judgment on this claim was appropriate. 50