598 F2d 1109 Franklin Life Insurance Company v. Commonwealth Edison Company

598 F.2d 1109

Fed. Sec. L. Rep. P 96,890
The FRANKLIN LIFE INSURANCE COMPANY et al., Plaintiffs-Appellants,

No. 78-1896.

United States Court of Appeals,
Seventh Circuit.

Argued Feb. 21, 1979.
Decided May 22, 1979.
Rehearing and Rehearing En Banc Denied June 27, 1979.

Frederick H. Stone, Springfield, Ill., for plaintiffs-appellants.

A. Daniel Feldman, Chicago, Ill., for defendant-appellee.

Before PELL and BAUER, Circuit Judges, and NOLAND*, District Judge.


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This action arose out of the issuance and subsequent redemption of one million shares of 9.44% Cumulative Prior Preferred Stock at a par value of $100 per share by the defendant. The plaintiffs alleged violations of §§ 11 and 17 of the Securities Act of 1933, 15 U.S.C. §§ 77k and 77q, and § 10(b) of the Securities Act of 1934, 15 U.S.C. § 78j(b) and Rule 10b-5, 17 C.F.R. § 240.10b-5, promulgated thereunder. They also alleged a breach of contract claim based on the redemption terms in the prospectus and in the defendant's Articles of Incorporation, and a third party beneficiary claim based on the defendant's alleged violation of its listing agreement with the New York Stock Exchange.


After trial, the district court entered judgment for the defendant on all counts and issued a thorough and well-reasoned memorandum order addressing each issue. 451 F.Supp. 602 (S.D.Ill.1978). The issues on appeal are virtually identical to those before the district court. Because we are of the opinion that the district court reached the correct result for the proper reasons, we adopt as our own that court's opinion except for the last paragraph on page 615 and the first paragraph on page 616. These two paragraphs are not essential to the result, and accordingly we do not deem it appropriate to reach the issue there addressed.

The judgment of the district court is




District Judge James E. Noland of the Southern District of Indiana is sitting by designation