The recommendations included strong purchase recommendations for securities of Welch Scientific, Tex-Star Oil and Gas Corp., and Howard Johnson Company. Preceding the four sales of July and August, 1961, Smith, Barney sent Chasins a written analysis of his then current security holdings and its recommendations in regard to his objective of aggressive growth of his holdings. Nor did Smith, Barney disclose how much it had paid for the securities sold as principal to Chasins or that it had acted as an 'underwriter' as defined by the Securities Act of 1933 in connection with the distribution of securities of Welch Scientific Company and Howard Johnson Company, two of the companies whose securities Smith, Barney sold to Chasins. In all four transactions Smith, Barney sold the securities to Chasins in the over-the-counter market, and although it revealed in the confirmation slips that it was acting as principal and for its own account in selling to Chasins, Smith, Barney did not reveal that it was 'making a market' in the securities involved as was the fact. e., the owner of the security being sold to Chasins. Smith, Barney acted in at least two capacities in these transactions, namely as Chasins' stockbroker and as principal, i. According to Chasins it was due to this relationship that he opened his brokerage account with Smith, Barney by orally retaining it to act as his stock broker. At the time the four transactions in question in his appeal occurred, Chasins was the musical director of radio station WQXR in New York City and was the commentator on a musical program sponsored by Smith, Barney.

В§ 78a et seq., for damages resulting from Smith, Barney's alleged violations of the Acts, and pendent common law violations, in handling Chasins' securities brokerage account was tried to the court without a jury. В§ 77a et seq., and the Securities Exchange Act of 1934, 15 U.S.C. This action brought by Chasins in the district court under the Securities Act of 1933, 15 U.S.C. We find no error and affirm the judgment. Chasins has cross-appealed the district court's ruling that appellant had not violated its common law fiduciary duty to Chasins by the manner it handled the transactions between the two.

В§В§ 78j (b) and 78 o(c), in not disclosing to appellee (Chasins) that it was making a market in the securities it sold Chasins in the over-the-counter market. Bonsal in the United States District Court for the Southern District of New York that Smith, Barney had violated Rules 10b-5 and 15c1-4 (17 C.F.R. This is an appeal by Smith, Barney & Co., Inc., a stock brokerage firm from a judgment for damages on a determination by Judge Dudley B. The petition for rehearing is otherwise denied. On petition for rehearing, the opinion filed Jis withdrawn and the following opinion substituted therefor. Substituted Opinion and Rehearing In Banc Denied March 2, 1971. C., for Securities and Exchange Commission, as amicus curiae.Д«efore SMITH, KAUFMAN and HAYS, Circuit Judges. C., on the brief for National Association of Securities Dealers, Inc. Counsel, National Ass'n of Securities Dealers, Inc., Washington, D. Arneson, New York City (Breed, Abbott & Morgan, New York City, Lloyd J.

Scribner, New York City, of counsel), on the brief for Ass'n of Stock Exchange Firms, amicus curiae. Leiman, New York City (Reavis & McGrath, New York City, Richard O. Rosenfeld, New York City (Graubard, Moskowitz, McGoldrick, Dannett & Horowitz, New York City, Philip Kazon, Jack Weinberg, New York City, of counsel), for appellee. Maney, New York City, of counsel), for appellant.Д®dward M. Marvin Schwartz, New York City (Sullivan & Cromwell, New York City, Michael M. Substituted Opinion and Rehearing Denied March 2, 1971. United States Court of Appeals, Second Circuit.

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