Securities and Exchange Commission v. Central-illinois Securities Corp. et al. (338 U.S. 96)
U.S. Supreme Court · decided June 27, 1949 · Supreme Court Database (Spaeth)
- Citation
- 338 U.S. 96 · 69 S. Ct. 1377
- Docket
- No. 226
- Argued
- January 12, 1949
- Decided
- June 27, 1949
- Term
- October Term 1948
- Vote
- 7–0
- Majority author
- Justice Rutledge
- Issue area
- Economic Activity
- Disposition
- Reversed and remanded
- Outcome
- Petitioning party won
- Ideological direction
- Liberal
How the Justices voted
- Majority
- Chief Justice Vinson, Justice Burton, Justice Frankfurter, Justice Reed, Justice Black, Justice Rutledge (wrote), Justice Murphy
Opinion excerpt
Mr. Justice Rutledge delivered the opinion of the Court. This case involves an amended plan filed under § 11 (e) of the Public Utility Holding Company Act of 1935 by Engineers Public Service Company. The plan provided, inter alia, for satisfying the claims of Engineers’ preferred stockholders in cash as a preliminary to distributing the remaining assets to common stockholders and dissolving the company. Broadly, the question is whether the Securities and Exchange Commission, in reviewing the plan, correctly applied the “fair and equitable” standard of § 11 (e) in determining the amounts to be paid the preferred stockholders in satisfaction of their claims. As will appear, the ultimate effect of the Commission’s determination was to allow the holders of the three series of Engineers’ outstanding cumulative preferred stock to receive the call (or voluntary liquidation and redemption) prices for their shares, namely, $105 per share, $110 per share and $110 per share, rather than the involuntary liquidation preference which, for each of the three series, was $100 per share. Common shareholders oppose the allowance to the preferred of the call price value, insisting that the maximum to which the preferred are entitled is the involuntary liquidation preference of $100. In this view the District Court and, generally speaking, the Court of Appeals have concurred, declining to give…
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