Nesbit v. McNeil case brief

Nesbit v. McNeil case brief summary
896 F.2d 380 (1990)

CASE SYNOPSIS

Defendants appealed the denial of a motion for judgment notwithstanding the verdict by the United States District Court for the District of Oregon following a jury verdict and award on a federal securities law claim in plaintiffs' favor. Plaintiffs cross-appealed challenging the directed verdict in favor of defendants on state securities law claims.

CASE FACTS
The district court denied defendants' motion for judgment notwithstanding the verdict after a jury verdict and award of damages for violations of 15 U.S.C.S§ 78j(b) and 17 C.F.R. § 240.10b-5. The district court entered a directed verdict against plaintiffs under Or. Rev. Stat. § 59.135 (1987). The defendant appealed arguing plaintiffs should not recover damages for churning where there was an increase in portfolio values that exceeded the amount of commissions charged. Plaintiffs cross-appealed arguing entitlement to attorney's fees.

DISCUSSION

• The court affirmed in all respects holding the jury's verdict was supported by substantial evidence because performance of the portfolio was separate from excess commissions, the earliest the statute of limitations began to run was at the time the final transactions in the account were consummated, and plaintiffs were not entitled to attorney's fees under Or. Rev. Stat. §§ 59.115(2), 59.135 (1987) because there was no buyer-seller relationship.

CONCLUSION
The court affirmed, holding plaintiffs could recover damages for churning because plaintiffs were wronged even though there was an increase in portfolio values and plaintiffs were not entitled to attorney's fees or damages under state securities law where there was no buyer-seller relationship.



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Securities Regulation in a Nutshell, 10th (Nutshell Series)
Securities Regulation: Examples & Explanations, 5th Edition
Securities Regulations: The Essentials