United States District Court for the Eastern District of Pennsylvania
72 F.R.D. 574 (E.D. Pa. 1976)
The plaintiff brought a class action suit against defendants on behalf of all individuals who purchased First Pennsylvania Corporation (First Penn) securities. The plaintiff alleged that the defendants made false and fraudulent statements in an attempt to hide First Penn’s financial condition. Specifically, the plaintiff alleged that First Penn: included as income interest accruals when borrowers had already defaulted; sold foreclosed properties at not arm’s length terms to avoid reporting a loss on the properties; failed to account for certain uncollectibles in real estate loans; and hid loan defaults by entering into modifications with borrowers. The defendants filed a motion to dismiss for failure to state a claim based on Rule 9(b) of the Federal Rules of Civil Procedure, arguing that the 9(b) standard is a “rigorous” one. Rule 9(b) provided that when a plaintiff alleges fraud or mistake he must plead the circumstances of that fraud or mistake specifically, but may plead conditions of the defendant’s mind such as intent or knowledge generally.
Rule of Law
Holding and Reasoning (Lord, III, C.J.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.
Here's why 201,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 14,000 briefs, keyed to 188 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.