Securities & Exchange Commission v. Ralston Purina Co. (346 U.S. 119)
U.S. Supreme Court · decided June 8, 1953 · Supreme Court Database (Spaeth)
- Citation
- 346 U.S. 119 · 73 S. Ct. 981
- Docket
- No. 512
- Argued
- April 28, 1953
- Decided
- June 8, 1953
- Term
- October Term 1952
- Vote
- 6–2
- Majority author
- Justice Clark
- Issue area
- Economic Activity
- Disposition
- Reversed
- Outcome
- Petitioning party won
- Ideological direction
- Liberal
How the Justices voted
- Majority
- Justice Minton, Justice Clark (wrote), Justice Douglas, Justice Frankfurter, Justice Reed, Justice Black
- Dissenting
- Chief Justice Vinson, Justice Burton
Opinion excerpt
Mr. Justice Clark delivered the opinion of the Court. Section 4 (1) of the Securities Act of 1933 exempts “transactions by an issuer not involving any public offering” from the registration requirements of § 5. We must decide whether Ralston Purina’s offerings of treasury stock to its “key employees” are within this exemption. On a complaint brought by the Commission under § 20 (b) of the Act seeking to enjoin respondent’s unregistered offerings, the District Court held the exemption applicable and dismissed the suit. The Court of Appeals affirmed. The question has arisen .many times since the Act was passed; an apparent need to define the scope of the private offering exemption prompted certiorari. 345 U. S. 903. Ralston Purina manufactures and distributes various feed and cereal products. Its processing and distribution facilities are scattered throughout the United States and Canada, staffed by some 7,000 employees. At least since 1911 the company has had a policy of encouraging stock ownership among its employees; more particularly, since 1942 it has made authorized but unissued common shares available to some of them. Between 1947 and 1951, the period covered by the record in this case, Ralston Purina sold nearly $2,000,000 of stock to employees without registration and in so doing made use of the mails. In each of these years, a corporate resolution authorized the sale…
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