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GLICK v. BLAIR & CO.
January 22, 1975
CHARLOTTE JOY GLICK
BLAIR & CO., INC., and FAHNESTOCK & COMPANY and NEW YORK STOCK EXCHANGE
The opinion of the court was delivered by: HIGGINBOTHAM
HIGGINBOTHAM, District Judge.
Fortunately, it is rare when the Courts are confronted with petitions such as the instant one filed by a defendant to enter a decree to enforce a settlement agreement. For reasons which hereafter appear, the motion of defendant is granted.
On July 30, 1971, Charlotte Glick filed suit against Blair and Company, Fahnstock and Company and the New York Stock Exchange for a series of alleged fraudulent transactions involving Bertram Lazar, formerly vice-president and registered representative of Blair and Company, and subsequently a registered representative of Fahnstock and Company. In addition to common law fraud violations, she alleged violations of the Federal Securities Act of 1933 and the Federal Securities Act of 1934. Subsequently, sixteen additional civil action cases were filed by other claimants (usually by counsel other than plaintiff's lawyer) against Blair, Fahnstock and the New York Stock Exchange. These seventeen cases were consolidated on my list for purposes of discovery and trial. After extensive pretrial discovery, there were a series of protracted pretrial and settlement conferences before Magistrate Richard Powers and the undersigned. Finally, on the week when the case was scheduled for trial, all of the plaintiffs' counsel agreed to settle all of the cases by claimants. The percentage of settlement was approximately 39% to 40% of the gross amount invested (with Lazar), with deductions from settlement figures for interest which the parties had received from Lazar. The case was particularly complex and had many uncertainties. There was the underlying issue as to whether certain insurance policies which had been issued to Blair would cover the claims made by some of the plaintiffs; Blair had become insolvent and was under a corporate reorganization as a result of which a federal judge in New York had stayed certain litigation. Even if plaintiffs got a verdict, there was a serious question as to whether it would be against Blair alone or against Fahnstock alone; in some cases there was the high probability that some plaintiffs might be precluded from getting any judgment against either Blair or Fahnstock because arguably they were under adequate notice that the "investments" with Lazar were a lark of his own and were not acts which had been authorized by Blair and/or Fahnstock. Liability against the New York Stock Exchange was in my view most tenuous and a directed verdict would probably have to be granted in favor of the New York Stock Exchange. With all of these variables it was agreed by all of the lawyers that the case would be settled on the aforementioned formula. It was agreed that the issue as to what amounts each respective defendant would contribute to the lump sum settlement would be left to the defendants to work out among themselves, as long as plaintiffs were guaranteed specific amounts on each claim.
I required all of the parties to consult with their clients and to exchange specific letters of agreement of settlement noting the specific amounts which had been agreed upon. For the nine civil actions which plaintiffs' counsel had, on November 12th he filed the following letter:
Robert L. Pratter, Esquire
Philadelphia, Pennsylvania 19110
Philadelphia, Pennsylvania 19102
Re: Glick et al vs. Blair ...
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