Section 2

Citation: Section 2
Parent Document: United Housing Foundation, Inc. v. Forman, 421 U.S. 837 (1975)
Jurisdiction: United States (federal)
Effective Date: 1975-10-06
Original Source: https://www.courtlistener.com/opinion/109272/united-housing-foundation-inc-v-forman/ ↗

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Both the Securities Act of 1933, 15 U. S. C. § 77b (1), and the Securities Exchange Act of 1934, 15 U. S. C. § 78c (a) (10), define the term “security” as including, among other things, an “investment contract.” The essential ingredients of an investment contract have been clear since SEC v. W. J. Howey Co., 328 U. S. 293, 301 (1946), held that “[t]he test is whether the scheme involves an investment of money in a common enterprise with profits to come solely from the efforts of others.” See Tcherepnin v. Knight, 389 U. S. 332, 338 (1967). There is no doubt that Co-op City residents invested money in a common enterprise; the only questions in*861volve whether the investment was to be productive of “profits to come solely from the efforts of others.”

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