GAF Corp. v. Milstein
United States Court of Appeals for the Second Circuit
453 F.2d 709 (1971)
- Written by Rich Walter, JD
Facts
By pooling their shares of convertible preferred stock issued by the GAF Corporation (plaintiff), Morris Milstein and his three children (defendants) amassed a 10.25 percent stake in GAF. The Milsteins leveraged that stake to maneuver GAF into buying a company in which the Milsteins were heavily invested. Thereafter, the Milsteins made no further purchases of GAF securities. GAF sued the Milsteins for failing to file, or falsifying, the identity-disclosure statements required by § 13(d) of the Securities Exchange Act of 1934 (Exchange Act), as added by the Williams Act. The Milsteins’ GAF purchases clearly met § 13(d)’s threshold requirement for purchases made within a 12-month period and conveying beneficial ownership in at least 10 percent of a single class of corporate securities. However, the Milsteins contended that § 13(d)’s disclosure requirements explicitly applied only to purchases by a single natural person or by single artificial entities such as the partnerships or syndicates listed in § 13(d)(3) of the Exchange Act, and not to purchases made by four individuals acting together only by informal agreement. The federal district judge agreed with the Milsteins and dismissed GAF’s case. GAF appealed to the Second Circuit.
Rule of Law
Issue
Holding and Reasoning (Kaufman, J.)
What to do next…
Here's why 811,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 46,300 briefs, keyed to 988 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.
