Deutschman v. Beneficial Corp.
United States Court of Appeals for the Third Circuit
841 F.2d 502 (3d Cir. 1989)
Relevant factsFree
Deutschman (plaintiff) bought call options on Beneficial's (defendant's) stock in reliance on false public statements by Beneficial's CEO and CFO that its financial troubles were over, and the options became worthless once the truth emerged; the district court dismissed his Rule 10b-5 claim, holding he lacked standing because he purchased only options rather than the underlying stock itself.
IssueFree
Whether the purchaser of a call option on a corporation's stock has standing to assert a Rule 10b-5 claim for misrepresentations made by the corporation.