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November 9, 1994


The opinion of the court was delivered by: RAYMOND J. DEARIE

 DEARIE, District Judge.

 Preliminary Statement

 Plaintiff, Tristar Corporation ("Tristar"), formerly known as Ross Cosmetics Distribution Centers Inc. ("Ross Cosmetics"), brings this action pursuant to Section 16(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78p(b) ("the Act"), to recover short swing profits from defendants Ross A. Freitas and Carolyn Safer Kenner. "For the purpose of preventing the unfair use of [inside] information," section 16(b) requires statutory insiders to disgorge to the issuer any "profit" realized from any purchase and sale (or sale and purchase) of securities occurring within a six month period. 15 U.S.C. § 78p(b). Tristar moves for summary judgment pursuant to Fed. R. Civ. P. 56(c) against defendants, who are defending this action pro se.


 On May 31, 1989, when over 3 million shares of Ross Cosmetics were outstanding, defendants Freitas and Kenner entered into a binding contract, captioned "Periodic Loan Agreement" ("Loan Agreement"), to dispose of 906,594 shares of Ross Cosmetics common stock or approximately 28 percent of the outstanding shares. (Rule 3(g) Statement at PP 7-9.) Under the Loan Agreement, defendants agreed to transfer the Loan Agreement shares ("Agreement Shares") to Starion International Limited, a British Virgin Islands Corporation ("Starion"); for 577,120 of the Agreement Shares defendants were to receive a fixed price amounting to $ 7.50 per share. Pursuant to the Loan Agreement, payments for the Agreement Shares were characterized as "loan disbursements." The disbursements were to be transferred to defendants in sixteen installments at the $ 7.50 per share price according to the timetable and in the amount set forth in Schedule A and Schedule B. (Rule 3(g) Statement at P 15.) An initial transfer of 60,868.00 shares for $ 283,310.62 at the share price of approximately $ 4.45 a share took place on the execution date of the agreement. (Loan Agreement at Schedules A and B.) Despite the installment feature of the Loan Agreement, it was "executed with the intention and belief . . . that it was and is to be performed in its entirety by the parties and was and is to be indivisible." (Loan Agreement at P 10.1(i)).

 In a series of transactions occurring between February 2, 1989 and June 15, 1989, defendants Freitas and Kenner purchased shares of Ross Cosmetics. (Rule 3(g) Statement at PP 28-29.) If the May 31, 1989 agreement was in fact a sale of the Agreement Shares, then defendants clearly purchased and sold shares within a six-month period. Defendants did not file Form 4 as required by section 16(a) until December 18, 1991. (Rule 3(g) Statement at P 32.) Plaintiff brought this action of December 16, 1993.

 The Court heard oral argument on this motion on November 4, 1994. As the Court noted, this motion presents two threshold legal issues: (1) whether the Loan Agreement executed on May 31, 1989, although denominated a "loan agreement," actually constituted a binding "contract to sell or otherwise dispose of" shares for the purposes of section 16(b) and (2) whether plaintiff's motion is barred by the applicable statute of limitations.


 Standard of Review

 Summary judgment should be granted only where there is "no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). The moving party must demonstrate the absence of any genuine issue of material fact. See Adickes v. Kress & Co., 398 U.S. 144, 157, 26 L. Ed. 2d 142, 90 S. Ct. 1598 (1970). Summary judgment is appropriate if, after drawing all reasonable inferences in favor of the party against whom summary judgment is sought, no reasonable trier of fact could find in favor of the non-moving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587-88, 89 L. Ed. 2d 538, 106 S. Ct. 1348 (1986).

 The Statute

 Section 16(b) provides, among other things, that when a statutory insider -- that is, an officer or director who is required to file reports under section 16(a) -- purchases and sells shares of covered equity securities within a six-month period, the profit on those transactions is recoverable by the issuer. *fn1" The statute represents a congressional effort "to curb short-swing trading by insiders whose position gives them access to information not available to the investing public and the ability to influence corporate policy." Kern County Land Co. v. Occidental Petroleum Corp., 411 U.S. 582, 592 n.23, 36 L. Ed. 2d 503, 93 S. Ct. 1736 (1973) (citation omitted). Employing what is commonly referred to as a "crude rule of thumb," section 16(b) "is not aimed solely at the actuality of evil, or the veritable ...

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