Court Opinion

ID: 9459449
Source: CourtListenerOpinion
Date Created: 2023-08-04 21:20:43.069266+00
Date Added: 2024-06-11T17:36:09.900430
License: Public Domain

COLEMAN, Circuit Judge
(concurring in part and dissenting in part):
With no difficulty at all I can, and do, concur in the opinion of this Court affirming the judgment below as to David Hoover, John Osorio, and South Atlantic Corporation.
As to the remaining appellant, Wag-goner Carr, I have serious doubt.
As the opinion points out, this was indeed a “complex affair”. The trial record consumed 2,533 pages. Since I am in agreement as to all appellants except one, I restrict my discussion to the findings of the District Court applicable to Mr. Carr. These findings are reported, 334 F.Supp. 452-453:
L. Waggoner Carr
1. At all times pertinent hereto defendant Waggoner Carr was a controlling shareholder of Nashwood.
2. Between approximately October of 1968 and June 1970 defendant Carr was a controlling shareholder and director of CB&T.
3. Between approximately October of 1969 and May of 1970 defendant Carr was chairman of the board and a member of the loan committee of CB&T.
4. At all times pertinent hereto defendant Carr was a controlling shareholder of SAC and RIC.
*9225. Between approximately April of 1969 and July of 1970 defendant Carr was a director, a vice president and chairman of the executive committee of RIC.
6. Between approximately April of 1969 and June of 1970 defendant Carr was a controlling shareholder of DB&T.
7. In his capacity as a controlling person of CB&T, defendant Carr approved the CB&T loan of $550,000.00 to Osorio and Carr, secured by 222,735 shares of SAC stock. While a controlling person and chairman of the board of CB&T and a controlling person of DB&T, those entities participated in a loan of $641,000.00 to NBL Plan, for the purpose of purchasing 22,500 shares of NBL stock.
8. As a controlling person, chairman of the board and member of the loan committee of CB&T, defendant Carr arranged for CB&T to make loans totaling approximately $165,-371.23 to FLAP, Inc. to enable FLAP, Inc. to purchase stock of NBL and OLI from Ling & Co.
9. As a controlling person of Nashwood and DB&T, defendant Carr approved the Nashwood purchase of NBL stock and used DB&T to finance such purchase, as more fully set out in paragraph J. 4. While a controlling person of Nashwood, which in turn owned West Virginia Life Insurance Company, that entity purchased MCI stock from Ling & Co., as more fully set out in paragraph J. 10.
10. As a controlling person of Nashwood, defendant Carr pledged 66,666 shares of NBL stock at SSB, as more fully described in paragraph J. 3.
As to whether these findings justified an injunction against Carr, his counsel cogently urges:
Carr’s pledge of unregistered stock was not a violation of the Securities Act, that the Commission failed its burden of proving that Carr aided and abetted the unlawful pledge of stock as collateral, that there is no evidence that Carr aided and abetted a scheme to manipulate and defraud, and that there was no evidence that Carr used the mails or-an instrumentality of commerce.
Upon consideration of the record as a whole, and particularly the specific findings as to this appellant, I would reverse and remand with directions that as to' him the injunction be dissolved.