Schupack v. Eddy

After having made a few purchases and sales through the defendant brokers on a cash basis, the plaintiff, on September 9th, 1929, opened a margin account with them. He had no previous experience in such accounts but understood that he was required to maintain a thirty-three and one third per cent margin. He at first thought that the margin was computed upon the market value rather than the loan value of the securities held in the account, but soon learned that the latter was the basis and that he could ascertain the loan value of his collateral only by inquiry from the defendants.

On October…