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October 31, 1972

John E. JENNINGS and Helen M. Jennings,
BOENNING & COMPANY and Boenning & Scattergood, Inc.

Broderick, District Judge.

The opinion of the court was delivered by: BRODERICK

BRODERICK, District Judge.

 This is an action for damages for violation of Regulation 12 C.F.R. § 220.4(b)(2) of the Securities and Exchange Commission, promulgated pursuant to 15 U.S.C. § 78g. This Regulation sets forth the margin requirements for brokers and dealers in securities. The plaintiffs claim that the defendants failed to liquidate plaintiff Helen M. Jennings' account when she did not make full payment for certain bond transactions within seven days after purchase, thus violating the Securities and Exchange Act and the Regulations enacted pursuant thereto. The complaint also alleges that the note made by plaintiffs to settle the deficit in Helen Jennings' account created by the defendants' alleged violations is void pursuant to 15 U.S.C. § 78cc as an additional and continuing extension of credit.

 On September 25, 1972, a hearing was held on plaintiffs' motion to preliminarily enjoin the defendants from proceeding with an execution sale of plaintiff Helen Jennings' residence, which execution sale was being made pursuant to a Common Pleas Court judgment entered on the aforesaid note which contained a confession of judgment. At the hearing the parties agreed to stipulate to all essential facts necessary for the Court's determination of the motion for a preliminary injunction, but the defendants vigorously contended that this Court was without jurisdiction to grant the injunction, that the judgment in the state court was res adjudicata, and more specifically that such an injunction would violate the federal anti-injunction statute, 28 U.S.C. § 2283. After the hearing and a review of the briefs of the parties, this Court determined that it did have jurisdiction, that the state court judgment was not res adjudicata, and that the federal anti-injunction statute did not prohibit this Court from issuing a preliminary injunction in this matter. On October 6, 1972, this Court issued the following Order:

AND NOW, this 6th day of October, 1972, on presentation and consideration of the complaint filed in this matter, and plaintiff's motion for a preliminary injunction and after a hearing, together with briefs, requests for findings of fact and conclusions of law, and a stipulation by the parties, it is
ORDERED that defendants Boenning & Company and Boenning & Scattergood, Inc., their agents, servants, employees and attorneys, and all persons in active concert and participation with them, pending the determination of this matter on the merits, are enjoined from commencing, or if commenced, from continuing with execution proceedings (defendants being directed to stay all such proceedings if commenced) against plaintiff Helen M. Jennings' premises at 250 Bell Road, Wynnewood, Montgomery County, Pennsylvania, on a judgment of the Montgomery County Court of Common Pleas of April 14, 1966, case no. 66-4339.
FURTHER ORDERED that as a condition to the effectiveness of this order that the plaintiffs file a bond with corporate surety approved by the Clerk of the Court in the amount of $5000.00. If at any time the plaintiff's equity in the premises should decrease so as to jeopardize the value of the defendant's judgment, the defendants may petition this Court for an increase in the amount of the bond.
FURTHER ORDERED that all discovery in this case shall be completed before December 1, 1972, and a settlement conference is hereby scheduled at 9:00 A.M. on December 4, 1972 and a pretrial conference on December 11, 1972 at 9:00 A.M. Immediately after the pretrial conference the case will be listed for trial.
Findings of fact and conclusions of law in support of this order will be filed by the Court.

 For the purpose of the motion for a preliminary injunction, the Court finds that:

 Plaintiff John E. Jennings, as defendant's registered representative purchased for plaintiff Helen Jennings' trading account certain Eastern Airlines debentures on February 9, 1966 and certain Rohr Aircraft debentures on January 18, 1966. The defendants failed to liquidate these transactions within seven days of the purchase dates when plaintiff Helen Jennings failed to make full payment, thus violating the margin requirements, and ultimately sold the Eastern securities on March 1, 1966 and the Rohr securities on March 2 and 3, 1966. During the time that the defendants held the securities in violation of the margin requirements, their fair market value decreased by $32,175. When they were finally sold, this $32,175 decrease in value was charged against Helen Jennings' account, resulting in a net deficit of $30,500. On April 12, 1966 Boenning and Company demanded that the plaintiffs give the firm a judgment note in the amount of $30,500 in payment of this deficit. After the Jennings signed the note, the brokerage firm, without notice, obtained a judgment based on a confession in the note in the Court of Common Pleas of Montgomery County, Pennsylvania, on April 14, 1966, Civil No. 66-4339.

 On July 13, 1970, ten days after execution proceedings were begun, Helen Jennings petitioned the Montgomery County Common Pleas Court to open the judgment and permit the assertion of a defense. Boenning & Company opposed the petition, and the matter was argued before the Common Pleas Court of Montgomery County sitting en banc. By its order of February 29, 1972, supported by an opinion of May 18, 1972, the Montgomery County Court denied Helen Jennings' petition to open. The Jennings took an appeal to the Pennsylvania Superior Court, and on August 10, 1972 the Superior Court affirmed the Common Pleas decision per curiam, without an opinion. Boenning and Company v. Jennings, et al., 222 Pa.Super. 712, 294 A.2d 739 (1972). The opinion of the Montgomery County Court states that the brokers alleged violations of the Securities and Exchange Act and Regulations thereunder were not considered, nor was jurisdiction entertained over the Jennings' asserted federal defense, the Court having held that laches precluded Helen Jennings from asserting her federal claim. Almost immediately after the Superior Court's affirmance, the brokerage firm reinstated execution proceedings and the Jennings' family residence was scheduled for sale by the Montgomery County Sheriff on or after October 18, 1972. The complaint in the instant action was filed in this Court on February 29, 1972, and the motion for a preliminary injunction to enjoin the sale was filed on September 14, 1972.

 The primary issue currently before this Court is whether the Federal Anti-Injunction Statute bars the granting of the requested relief. The ...

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