Sidney B. Weiner v. Shearson, Hammill & Co., Inc., a Corporation

Weiner brought this action in the Arizona District Court against his stockbroker, Shearson, Hammill & Co., Inc., alleging that the company had mishandled the sale and purchase of certain shares in Weiner’s account in such a way as to violate the federal securities laws. Weiner sought a declaration that he owed the company nothing, and a judgment for compensatory damages for the diminution in value of the shares, and for punitive damages. The company moved for a dismissal of the action on the grounds that the complaint failed to state a claim upon which relief could be granted, or alternatively, that the action should be dismissed or stayed in deference to an identical action involving the same parties and the same transactions already pending in the Arizona Superior Court. The district court granted the motion to dismiss, but did not disclose the basis for its order. Weiner then brought this appeal. At oral argument, we directed the parties to augment the record with the record of the proceedings in the Arizona Superior Court, and that record is now before us. For the reasons hereinafter stated, we reverse the order of dismissal and remand the case for further…