Marx & Co., Inc. v. Diners Club, Inc.

550 F.2d 505 (2d Cir. 1977)

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Nature of the Case

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Facts

The Fugazys (P) were trying to sell their company's assets to Diners Club (D) in exchange for unregistered stock. P sued D, claiming that D fraudulently induced them into selling. Their specific problems were that D did not tell P about a takeover bid and that D violated its contractual duty to use its best efforts to register P's stock. Friedman, a securities law expert witness, testified at D's trial about his opinions on the parties' legal obligations under the contract and about the legal insufficiency of the D's defenses. The jury found for P. D appealed.