Court Opinion

ID: 8879200
Source: CourtListenerOpinion
Date Created: 2022-11-26 20:02:35.85097+00
Date Added: 2024-06-11T17:06:33.057566
License: Public Domain

ANDERSON, Circuit Judge
(concurring in the order to remand):
I agree with Judge Feinberg’s discussion of the facts and the issues but I would go further and hold that the defendants violated § 21 of the Act. There is no question that the 20% policy was an “investment” policy within the meaning of § 21, or that the loans in issue were in excess of the 20% ceiling. Because § 21 contains no provision for authorization by a majority of stockholders of deviations from policy, as in § 13, the most persuasive argument that ratification is permissible under § 131 *1011is not applicable under § 21. Nor is the defense of good faith reliance provided by § 38 available under § 21, because the SEC has issued no regulations pursuant to that section.
In my opinion there is no need on remand for the district judge to rule on liability under §§ 8(b) (1) and 13(a) (2), as to which the SEC has taken no position, or to consider again arguments relating to liability under §§ 8(b) (2) and 13(a) (3). The view which the court took in regard to the latter sections was, at the time, compelled by the SEC’s regulations, if not by the language of the statute alone. If there is need for revision of this portion of the Act, or the regulations, it is up to Congress and the Commission, not the courts, to make the change.
I am not wholly persuaded by the affidavits which the defendants have submitted on appeal that there is no longer any possibility of the plaintiff obtaining relief, by way of damages or otherwise, and the case must therefore be remanded to the district court in any event.

. As a general rule, a majority of stockholders may ratify retroactively acts which they might originally have authorized. See e. g., Boyce v. Chemical Plastics, Inc., 175 F.2d 839 (8 Cir.), cert. dednied, 338 U.S. 828, 70 S.Ct. 77, 94 L.Ed. 503 (1949).