Court Opinion

ID: 9858787
Source: CourtListenerOpinion
Date Created: 2023-09-24 16:39:15.070074+00
Date Added: 2024-06-11T09:55:56.371475
License: Public Domain

EDWARD WEINFELD, Judge of the Panel
(dissenting):
I dissent insofar as the SEC action is ordered included in the coordinated pretrial proceedings. The objective of that action is different from those of the private litigations. Basically, the SEC action seeks to protect the public interest by enjoining alleged continued violation of the securities acts.1 As a matter of general policy, it is undesirable that SEC actions for injunctive relief, whose sole purpose is the expeditious safeguarding of the public interest, be subjected to the delays that are inherent in private litigations, with their different concerns, even where those private actions parallel the SEC complaints. In many cases, the Commission’s use of its subpoena power has substantially developed the essential facts required to support its application to the courts for equitable relief; therefore, the need for further discovery is minimal and vastly different from those who allege private injury and seek money damages. To lump the SEC action with the private lawsuits would result in a slowdown in its effort to protect the public; it would defeat rather than “promote the just and efficient conduct” of the SEC litigation. With due deference to the majority, it is unrealistic to suggest that “there is no reason why the decision of the class action question or the discovery necessary in the private actions should unnecessarily delay the SEC in preparing for trial against the remaining defendants.” Ofttimes the delay and postponement suit the purpose of the private litigant whose sole interest is a financial recovery. In this very case the record shows that the Commission has moved with expedition and dispatch, *1320whereas a leisurely pace has characterized most of the private lawsuits. Finally, for the Panel to adopt a general policy (which of course permits exceptions in unusual situations) which would recognize the role of the SEC in protecting the public interest in no respect would offend any Congressional purpose. The legislative history of § 1407(a) indicates that no consideration was given to exempting the SEC from its provisions. In that circumstance, there is no basis for a claim that “It would be violative of the basic statutory purpose for us now to read such an exception into the statute.” The courts have frequently, in the exercise of their equity powers, and in the public interest, adopted policies adequate to the occasion.
Entirely apart from general policy considerations, an additional reason for nonconsolidation is that since the argument of the motion before this Panel an injunction has been entered against National Student Marketing upon its consent and the SEC case is in posture to go forward for an early trial, which is not the case in the instance of the private lawsuits. Cf. In re Grain Shipments, 300 F.Supp. 1402, 1405 (Jud.Pan. Mult.Lit.1969); In re Protection Devices and Equipment and Central Station Protection Service Antitrust Cases, 295 F.Supp. 39 (Jud.Pan.Mult.Lit.1968). The result reached in the present case is inconsistent with that reached in the King Resources litigation, where the Panel declined to consolidate a related action brought by the SEC because of its “advanced stage of preparation.” In re King Resources Company Securities Litigation, 342 F.Supp. 1179, 1183, n. 13.

. Cf. SEC v. Ralston Purina Co., 346 U.S. 119, 124, 73 S.Ct. 981, 97 L.Ed. 1494 (1953); A. C. Frost & Co. v. Coeur D’Alene Mines Corp., 312 U.S. 38, 40, 61 S.Ct. 414, 85 L.Ed. 500 (1941); Berko v. SEC, 316 F.2d 137, 141 (2d Cir. 1963).