The United States Court of Appeals for the Seventh Circuit has disavowed the purchaser-seller limitation known as the Birnbaum rule and has held that any person may seek private relief under section 10(b) and rule 10b-5, if he has, in his capacity as an investor, suffered significant injury as a direct consequence of a fraud in connection with the purchase or sale of securities.
Eason v. General Motors Acceptance Corporation, 490 F.2d 654 (7th Cir. 1973), cert. denied, 416 U.S. 960 (1974).
Dennis K. Larry,
Securities - Securities Exchange Act of 1934 - Section 10(b) - Securities and Exchange Commission Rule 10b-5 - Birnbaum Rule,
Duq. L. Rev.
Available at: https://dsc.duq.edu/dlr/vol13/iss2/9