5 Mass. App. Ct. 831 | Mass. App. Ct. | 1977
The defendant Lipshutz appeals from that part of a judgment entered for the plaintiff Liberty Bank and Trust Company (bank) on a counterclaim by Lipshutz. Lipshutz based his counterclaim on an escrow agreement executed among a stock issuer (ARP), an underwriter (Newton), and the bank providing that the bank would serve as escrow agent for an “all or none” offering of ARP stock and would return the purchase money to subscribers if all 150,000 shares in the offering were not “sold” by January 17, 1973. Lipshutz, who ordered 10,000 shares on January 16 and paid for them on February 4, concedes that orders for all 150,000 shares were placed on January 17, but he contends that the bank was obligated under the escrow agreement to return his money because the bank did not receive the purchase money for the full subscription until February 5. He points to a release issued by the Securities and Exchange Commission (SEC) in July, 1975, stating that for purposes of SEC Rule 10b-9, promulgated pursuant to the Securities Exchange Act of 1934 (15 U.S.C. § 78j [1970]), an “all or none” offering may not be considered “sold” unless all the securities required to be placed by a particular date are actually paid for by that date. Assuming arguendo that Lipshutz, who was not a party to the escrow agreement, can maintain his counterclaim by fitting one of the exceptions to the third-party beneficiary
Judgment affirmed.
