(dissenting):
For the reasons set forth in my dissenting opinion in Securities and Exchange Commission v. Texas Gulf Sulphur Co. et al., 401 F.2d 833, pp. 870-889, I would hold that the “in connection with the purchase or sale of any security” requirement of Rule 10b-5 has not been met in the complaints dismissed below. Therefore, I would affirm the decisions of Judges Sugarman and Cooper. Apparently, the propriety of these suits as appropriate class actions has not been presently challenged and is not before us. In any event, even if proper, resolution of any and all issues relating thereto would be for the trial. The Heit and Volk consolidated amended complaint alleges that plaintiff Heit “brings this action on his own behalf and on behalf of all other persons who purchased Belock’s debentures between April 30, 1964 and June 21, 1965, and who have either sold or continue to hold such debentures at a loss.” The allegation as to Yolk is identical except that it relates to common stock. Obviously, such a class, which plaintiffs claim to champion, would be wholly unrelated to any of the facts as pleaded. Belock was engaged principally in engineering and manufacturing military electronic equipment. The price range of Belock’s 6% convertible debentures in 1964 was 178 high and 97% low and in the first six months of 1965, 149 high and 75 low; for the common stock the range was 1964 high, 5%, low 3%, and for the first six months of 1965, 5% high, 2% low. The causes for the wide fluctuations of the thousands of listed securities would be legion even if ascertainable and cover events from the national and international to ever-changing local situations in specific companies. A class for purposes of a lawsuit could scarcely consist of all persons who bought stock on one of the national exchanges and subsequently sold it at a loss. To be sure, plaintiffs qualify this claim by alleging that “The other members of the stock class and the debenture class purchased and retained Belock’s securities in reliance on the truth of the statements and representations herein alleged.” Cons. Am’d Compl. ¶ 11(b). Thus, limited to “reliance,” possibly a “class” is stated. As previously stated, this determination, together with damages, if any, must await a trial. The same infirmities as to “class” exist in my opinion in the Howard complaint to an even greater extent because the limitation is less specific.