NOTES ARE - ARE NOT - ALWAYS SECURITIES - A REVIEW

NOT EVERY NOTE IS A SECURITY. THE COMMERCIAL CONTENT OF THE UNDERLYING TRANSACTION HAS TO BE EVALUATED. NOTES ISSUED FOR PERSONAL LOANS AND CONSUMER INSTALLMENT PURCHASES ARE NOT SECURITIES. NOTES THAT ARE ISSUED FOR INVESTMENTS AND BUSINESS ACQUISITIONS AS WELL AS COMMERCIAL PAPER SOLD OUTSIDE THE NORMAL INSTITUTIONAL MARKET ARE SECURITIES. THE MIDDLE GROUND HAS BEEN NARROWED, BUT WILL STILL FROM TIME TO TIME CREATE A PROBLEM. THE COURTS HAVE SEEN THE IMPACT OF THE OPEN FLOODGATES IN OTHER AREAS AND SHOULD PAY HEED TO THE LEGISLATIVE INTENT AND POLICY CONSIDERATIONS. THE FEDERAL SECURITIES LAWS ARE NOT THE APPROPRIATE VEHICLE FOR CONSUMER PROTECTION ON INSTALLMENT SALES. FIVE APPELLATE DECISIONS IN THE LAST FEW YEARS HAVE FOCUSED SQUARELY ON THE ISSUE - EARLIER OPINIONS WHILE TOUCHING ON IT, MANAGED TO SKIRT DIRECT CONFRONTATION. DESPITE LANGUAGE IN THESE CASES SUCH AS ANY NOTE, REGARDLESS OF ITS NATURE, IS FULLY SUBJECT TO WHATEVER ANTIFRAUD PROVISIONS ARE CONTAINED IN THE FEDERAL SECURITIES LAWS, IT IS OPEN TO QUESTION WHETHER THE COURTS REALLY MEAN JUST THAT.