Fed. Sec. L. Rep. P 96,260 Brent L. Berry v. Al Souza, and His Wife Jane Doe Souza, and Walston & Co., Inc.

Appellant Berry brought an action in the United States District Court for the Western District of Washington against Walston & Company, Inc. (hereinafter “Walston”), a stock brokerage firm, and appellee A1 Souza, an employee of Walston. Each of the five claims contained in the complaint specifically alleged violations of either: (1) the anti-fraud provision of the Securities Exchange Act of 1934 (the “Act”), 15 U.S.C. § 78j; (2) the well-known regulations adopted pursuant to the anti-fraud provision of the Act; (3) various articles of the Rules of Fair Practice of the National Association of Securities Dealers (“NASD”); or (4) a supposed “implied representation [by Souza] that he would deal fairly with” Berry. Various paragraphs of the complaint, and particularly paragraph 17, also intimated that certain purchases made by Souza for Berry’s account violated the margin requirements contained in so-called Regulation T, 12 C.F.R. §§ 220.1 et seq., a set of regulations promulgated by the Federal Reserve Board pursuant to the terms of the Securities Exchange Act, 15 U.S.C. § 78g. Upon stipulation of all parties, the pending civil action was transferred to the United States District…