594
Thomas, J., dissenting
III
The majority's analysis of § 12(2) is motivated by its policy preferences. Underlying its reasoning is the assumption that Congress could never have intended to impose liability on sellers engaged in secondary transactions. Adopting a chiding tone, the majority states that "[w]e are reluctant to conclude that § 12(2) creates vast additional liabilities that are quite independent of the new substantive obligations that the Act imposes." Ante, at 572. Yet, this is exactly what Congress did in § 17(a) of the 1933 Act as well as in § 10(b) of the 1934 Act. Later, the majority says: "It is not plausible to infer that Congress created this extensive liability for every casual communication between buyer and seller in the secondary market." Ante, at 578. It is not the usual practice of this Court to require Congress to explain why it has chosen to pursue a certain policy. Our job simply is to apply the policy, not to question it.
I share the majority's concern that extending § 12(2) to secondary and private transactions might result in an unwanted increase in securities litigation. But it is for Congress, and not for this Court, to determine the desired level of securities liability. As we said last Term in Central Bank of Denver, policy considerations " 'cannot override our interpretation of the text and structure of the Act, except to the extent that they may help to show that adherence to the text and structure would lead to a result 'so bizarre' that Consion that Congress wanted to extend § 17(a) to secondary sales. The passage cited by the majority and by Naftalin, S. Rep. No. 47, 73d Cong., 1st Sess., 4 (1933), see ante, at 577-578, was unrelated to § 17(a), and instead discussed a Senate proposal which was replaced by the House bill as the basis for the 1933 Act. In fact, the §§ 11 and 12 referred to in the Senate Report were originally extensive exemption, rather than liability, provisions that did not survive the legislative process. See S. 875, 73d Cong., 1st Sess., 20-24 (1933). The majority's approach seriously undermines this Court's holding and methodology in Naftalin.
Page: Index Previous 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 NextLast modified: October 4, 2007