author: SHADUR, District Judge.

text:
    EXCALIBUR OIL, INC., Plaintiff, v. Larry N. SULLIVAN, Defendant.
    No. 84 C 8881.
    United States District Court, N.D. Illinois, E.D.
    Aug. 14, 1985.

      Michael P. Myers, Arthur T. Susman, Joseph, Susman. & Myers, Chicago, Ill., for plaintiff.
    Hinshaw, Culbertson, Moelmann, Hoban & Puller, Chicago, Ill., for defendant.
   MEMORANDUM OPINION AND ORDER

SHADUR, District Judge.

Excalibur Oil, Inc. (“Excalibur”) has sued Larry Sullivan (“Sullivan”) under a melange of federal and state securities laws and under Illinois common law, claiming it suffered damages as a result of Sullivan’s alleged misrepresentations in connection with a sale of securities to Excalibur. Sullivan now moves to dismiss under Fed.R.Civ.P. (“Rule”) 12(b)(6). For the reasons stated in this memorandum opinion and order, Sullivan’s motion is denied in principal part and granted to a narrow extent.

Facts

During 1983 Oil Development Company (“ODC”) was engaged in the business of obtaining mineral leases and drilling, completing and operating oil and gas wells in West Virginia (Complaint ¶ 5). In May 1983 ODC employees John Gable (“Gable”), Ronald Young (“Young”) and J. Alan Gable (he and Gable are collectively referred to as “Gables”) solicited Excalibur’s President John Turetzky (“Turetzky”) to purchase working interests in wells to be drilled on properties subject to existing oil and gas leases in West Virginia (Complaint 118). In connection with the solicitation, Gables and Young delivered to Excalibur (Complaint If 9):

1. geology reports on the proposed well sites and
2. a May 11, 1982 title opinion prepared by Sullivan, relating to one proposed site known as the Jackson property-

Sullivan, an attorney, had previously prepared title opinions for Gable on other properties in which Gable had a leasehold interest (Complaint 1111(c)).

On May 24,1983 Turetzky met with Gable in Davisville, West Virginia to discuss Excalibur’s purchase of working interests in two wells to be drilled: one (known as Jackson #6) on the Jackson property and the other (known as Lambert # 2) on another parcel called the Lambert property (Complaint ¶ 10). Gable represented to Turetzky that no liens had been created on the Jackson lease since 1982 (when Sullivan had prepared the title report) and that ODC had no undisclosed liabilities (Complaint 11 11(a)). Turetzky told Gable Excalibur required assurances, including current title opinions on the two properties, that the oil leases on the properties were free of encumbrances (Complaint 1111(b)).

Having told Turetzky Sullivan did all of Gable’s title work (Complaint 111111(c) and 11(e)), Gable took Turetzky to an office across the hall from Gable’s office to meet Sullivan (Complaint ¶ 11(d)). At that meeting Turetzky repeated to Sullivan that before Excalibur would invest in the wells it needed assurances of unencumbered property leases, and he therefore asked Sullivan to prepare up-to-date title opinions (Complaint ¶ 11(f)). Sullivan responded (id.):

[N]o problem. I know that the leases are clean. It is just a matter of getting the paperwork out to you.

Turetzky told Sullivan to bill Excalibur for his legal services rendered in preparing the title opinions, and Sullivan agreed to do so (Complaint 1112).

On July 1, 1983 Gable visited Excalibur’s offices in Illinois and the parties executed two participation and operating agreements, pursuant to which Excalibur was to purchase a 50% working interest in each of the to-be-drilled Jackson # 6 and Lambert # 2 wells (Complaint 1113). Those agreements were subject to a warranty of title “against claims of persons claiming by, through or under” ODC (Complaint ¶ 14).

On July 28, 1983 Turetzky telephoned ODC and spoke with Young, saying Excalibur would not deliver funds in connection with the property agreements unless it received assurances the leases were clear of encumbrances (Complaint ¶ 15(a)). Young connected Turetzky with Sullivan, who again said there was “no problem” with the leases and he was just behind in preparing his paperwork (Complaint ¶ 15(d)). In reliance on Sullivan’s statements, Excalibur delivered $270,000 to ODC in accordance with their agreement (Complaint ¶ 16).

On August 23, 1983 Excalibur and ODC entered into a third participation and operating agreement, under which Excalibur was to purchase a 50% working interest in a third proposed well, Lambert # 3 (Complaint ¶ 17). That agreement too was subject to a comparable warranty of title (Complaint 1118). During September 1983, based on Sullivan’s earlier representations about the Lambert property, Excalibur delivered $135,000 to ODC (Complaint 1f 19).

On October 21,1983, at a meeting attended by Turetzky, Excalibur Chairman Thomas Falese, Gable, Young and Sullivan, Pales e and Turetzky again asked Sullivan to provide Excalibur with written title opinions. Sullivan once more said he would do so but was just behind in his paperwork. At the meeting Sullivan acknowledged the existence of a $1 million mortgage security-agreement and assignment of production to Halliburton Company (the “Halliburton Agreement”) affecting the Jackson lease, but he said it did not encumber Excalibur’s interest in Jackson # 6 (Complaint 1120).

Complaint ¶ 21 and 22 charge Sullivan’s statements at the May 24 and July 28, 1983 meeting and his other representations were false in that:

1. ODC’s Jackson property lease (and hence Jackson # 6) was actually encumbered by:
(a) the Halliburton Agreement and
(b) a July 22, 1983 mortgage and conditional assignment in the amount of $100,000 to Buckeye Crude Exploration, Inc.
2. ODC’s Lambert property lease (and thus Lambert # 2 and # 3) was subject to an August 24, 1983 mortgage and conditional assignment in the amount of $100,000 to Buckeye Crude International, Inc.
3. Both leases were subject to numerous mechanic’s and judgment liens.

Excalibur’s Claims

Excalibur advances a battery of claims against Sullivan, some on the theory he was ODC’s attorney and agent and others predicated on his acting as Excalibur’s attorney and agent. Counts I—III assert common law claims stemming from Sullivan’s alleged misrepresentations and based on several theories:

1. negligence (Count I);
2. breach of Sullivan’s fiduciary duty as Excalibur’s attorney (Count II); and
3. breach of Sullivan’s contract with Excalibur to provide updated title opinions (Count III).

Counts IV-VIII allege violations of various federal and state securities laws:

1. Securities Exchange Act of 1934 (“1934 Act”) § 10(b) (“Section 10(b)”), 15 U.S.C. § 78j(b), and related Rule 10b-5, 17 C.F.R. § 240.106-5 (Count IV);
2. Securities Act of 1933 (“1933 Act”) § 17(a) (“Section 17a”), 15 U.S.C. § 77q(a) (Count V);
3. 1933 Act § 12(2) (“Section 12(2)”), 15 U.S.C. § 77l (Count VI);
4. Illinois Securities Law of 1953 as amended (“Illinois Act”) §§ 5, 6 and 7, Ill.Rev.Stat. ch. 12VA, ¶¶ 137.5, 137.6 and 137.7 (citations to' the Illinois Act will also take the form “Section—,” omitting the prefatory 137.) (Count VII); and
5. Uniform Securities Act of West Virginia (“West Virginia Act”) §§ 32-1-101, 32-2-202 and 32-4-410, W.Va.Code §§ 32-1-101, 32-2-202 and 32-4-410 (again this opinion’s citations will take the form “Section—,” this time omitting the prefatory 32-) (Count VIII).

Sullivan’s Responses

In support of his motion Sullivan contends:

1. All counts should be dismissed as to the Lambert property transactions, because Excalibur has not alleged the Lambert property was encumbered when Sullivan made his representations.
2. Excalibur’s breach of contract claim is defective because the failure to prepare title opinions was not the proximate cause of Excalibur’s damages.
3. No action exists under Section 10(b) or Rule 10b-5 for an attorney’s misrepresentations or omissions as to his or her own client.
4. Excalibur’s Section 17(a) claim is defective in three respects:
(a) Section 17(a) does not provide for an action by a client against his own attorney.
(b) Complaint ¶ 138 alleges wrongful conduct “in connection with the purchase of working interests by Excalibur,” while the 1933 Act requires wrongful conduct in connection with the sale of securities.
(c) Liability under the 1933 Act extends only to sellers and offerors or those who aid and abet them. Excalibur has not alleged Sullivan fits any of those categories.
5. Sullivan does not belong to any of the categories of persons that may be held liable under:
(a) Section 12(2);
(b) the Illinois Act; or
(c) the West Virginia Act.

Each of those contentions will be dealt with in turn.

Lambert Transactions

Sullivan points out Excalibur has not identified a single specific encumbrance that affected the Lambert property at the time Sullivan represented both properties were encumbrance-free. Complaint H 21 identifies two encumbrances on the Jackson property. Complaint ¶ 22 specifies a mortgage on the Lambert property dated August 24, 1983, nearly one month after the last of Sullivan’s representations as to title. Apart from those three specific encumbrances, Excalibur alleges only (Complaint 1122):

[T]he leases are subject to additional claims, liens or encumbrances as follows:
******
(b) Numerous mechanic’s liens; and
(c) Numerous judgment liens.

Sullivan argues that unless his statements misrepresented the state of the Lambert title,. Excalibur can show no causal nexus between those statements and any damages Excalibur sustained through the Lambert investments. He says each transaction must be analyzed separately, and any link between his misrepresentations as to the Jackson property and Excalibur’s losses on the Lambert wells is too attenuated to sustain liability under any theory of recovery, whether in contract or tort or under the securities laws. And Sullivan urges Excalibur’s allegation of “numerous” mechanic’s and judgment liens encumbering “the leases” is so vague as to be insufficient under Rule 9(b) to allege an encumbrance on the Lambert property.

Excalibur’s responsive memorandum clarifies it is not claiming the Lambert property was encumbered at the time of Sullivan’s misrepresentations. Instead Excalibur argues Sullivan’s misrepresentations as to the Jackson property proximately caused the Lambert damages because Excalibur would not have entered into the Lambert investments had Sullivan truthfully represented the status of the Jackson title.

It will be recalled Turetzky was first referred to Sullivan May 24, 1983, to confirm Gable’s representation as to the absence of new liens on the Jackson property since Sullivan’s preparation of his May 11, 1982 title opinion. Complaint ¶ 23 then alleges that if Sullivan had told Turetzky the truth about the encumbrances on that property:

Excalibur would have realized that Gable was not trustworthy and honest, would have been on notice that the financial condition of Oil Development Company was not as represented, would not have consummated [the Jackson # 6/Lambert # 2 deal], and would not have entered into [the Lambert # 3 investment].

Under the operative rules for reading complaints for Rule 12(b)(6) purposes, that states a sufficient nexus between Sullivan’s misrepresentations and Excalibur’s losses as to both the Jackson and the Lambert wells.

Breach of Contract

That analysis also disposes of Sullivan’s claim of no causal connection between Excalibur’s losses and Sullivan’s failure to prepare current title opinions. Sullivan Mem. 4 asserts a nonsensical argument in that respect:

Had Sullivan prepared title opinion [sic], plaintiff would have been damaged nonetheless. The report simply would have informed plaintiff that there were problems with its investment (assuming the alleged encumbrances existed).

To the contrary, Complaint It 23 says a truthful title opinion would have told Excalibur much more than “that there were problems with its investment.” It would also have informed Excalibur Gable was “not trustworthy” and ODC was in worse financial shape than it let on. And Excalibur would not “have been damaged nonetheless,” for it would have backed out of the deal.

Sullivan R.Mem. 6-7 altered his causation argument somewhat, but the new version is as untenable as the original. Sullivan contends Excalibur cannot assume his report—even if timely—would have been accurate. That would render it speculative to say the lack of a timely report caused Excalibur’s injuries. Moreover, Sullivan argues, an inaccurate report would give rise to liability only in tort (malpractice), not contract.

Those new arguments—premised as they are on an unnaturally minimalist conception of the Excalibur-Sullivan contract—violate the command in Wolfolk (see n. 3) to view the Complaint’s allegations in the light most favorable to Excalibur. According to Complaint ¶ H 11(f) and 12, Excalibur told Sullivan it required assurances of clear title before investing in the wells, and Sullivan then agreed to prepare current title opinions. Surely a reasonable inference from those allegations is that Sullivan knew time was important and agreed to have the opinions completed before Excalibur was required to deliver funds.

There is something terribly offensive about a lawyer’s assertion that his contract to prepare a title opinion called for nothing more than his delivery of an unreliable piece of paper. Necessarily implicit in any such contract is the lawyer’s duty to investigate the title with reasonable diligence and to report his findings accurately. Sullivan’s failure to fulfill those obligations would certainly amount to a breach of contract. And if Sullivan indeed failed either to discover an obvious encumbrance or to report it to Excalibur, no speculation is involved in concluding the breach was a proximate cause of Excalibur’s losses.

Finally Sullivan R.Mem. 7-8 argues in the alternative:

1. Sullivan had no contractual obligation to deliver the written opinions before Excalibur delivered funds to ODC.
2. Even if Sullivan had such an obligation, Excalibur waived it by tendering funds to ODC based on Sullivan’s oral representations.

This opinion has already disposed of the first of those arguments. As for the second, even if the Complaint supported a waiver theory (as it does not), and even if such a fact-based question could appropriately be decided on a motion to dismiss (as it cannot), at most Sullivan can claim Excalibur waived Sullivan’s obligation to make timely delivery of a document memorializing his opinion. Under the Complaint Sullivan does not (and cannot) argue Excalibur also waived Sullivan’s contractual obligations (1) to investigate the titles and (2) accurately to report his findings before the delivery of funds. Excalibur may well have believed Sullivan’s oral representations just before Excalibur’s payment to ODC were based on an investigation undertaken pursuant to Sullivan’s contract with Excalibur.

Attorney-Client Relationship Issues

Sullivan spins out an elaborate analysis of why a client should not be able to invoke Rule 10b-5 to sue his or her own attorney for misrepresentations or omissions. Sullivan urges Rule 10b-5 was designed only to protect buyers from misrepresentations by sellers acting at arm’s length to advance their own adverse interests. Moreover, Sullivan Mem. 7-8 argues the scope of an attorney’s duties to a client is determined exclusively by the terms of the agreement under which the client retained the attorney.

Where Sullivan jumps the tracks is in his premise that Excalibur has sued Sullivan only as its attorney. True enough, portions of the Complaint—such as Count I’s breach of contract claim and Count II’s breach of fiduciary duty claim—are predicated on an alleged lawyer-client relationship between Sullivan and Excalibur. But the securities law claims treat Sullivan as ODC’s attorney, or indeed as attorney for both Excalibur and ODC. Even were the different claims inconsistent (and they are not necessarily so), that is entirely permissible under the Rules. See 5 Wright & Miller, Federal Practice and Procedure: Civil § 1283 (1969), explaining that facet of Rule 8(e)(2).

That obviates any need to decide whether Section 10(b) and Rule 10b-5 permit a client’s suit against his or her attorney. There is clearly enough to support the reasonable inference Sullivan acted as ODC’s attorney, even if he simultaneously purported to act (or Excalibur reasonably believed he was acting) as Excalibur’s attorney:

1. Gable introduced Sullivan to Turetzky as the attorney “who did all of Gable’s title work” (Complaint ¶ 11(e)).
2. Sullivan had prepared a title opinion for Gable on the Jackson property in 1982, just a year before the transactions at issue here (Complaint ¶ 9(b)).
3. Gable’s very introduction of Turetzky to Sullivan in response to Turetzky’s request for assurances regarding the title implied Sullivan was Gable’s agent and was empowered to make representations for Gable.
4. Sullivan’s office was just across the hall from Gable’s (Complaint ¶ 11(d)).
5. Sullivan sat in with Gable and others on at least one meeting with Excalibur representatives (Complaint ¶ 20).

Nothing flows from the absence of a Complaint allegation specifically identifying Sullivan as ODC’s attorney.

Sullivan concedes that nothing in Section 10(b) or Rule 10b-5 exempts the seller’s lawyer from liability to a purchaser merely because of his or her status as attorney. As Judge Friendly put it in SEC v. Frank, 388 F.2d 486, 489 (2d Cir.1968):

[A] lawyer, no more than others, can (sic) escape liability for fraud by closing his eyes to what he saw and could readily understand.

That especially holds true where the attorney is sued on the basis of his or her affirmative misrepresentation, rather than merely as a passive participant in the alleged fraud. Sohns v. Dahl, 392 F.Supp. 1208, 1213 n. 8 (W.D.Va.1975) (“A license to practice law would not clothe an individual with armor against his direct misrepresentations to a purchaser or seller”).

Precisely the same analysis applies to Sullivan’s arguments that Section 17(a):

1. does not permit a client’s suit against his or her attorney; and
2. requires wrongful conduct in connection with the sale rather than the purchase of securities.

To the extent Excalibur has sued Sullivan in his capacity as ODC’s agent and counsel, Excalibur has not (1) sued its own lawyer or (2) sued Sullivan for purchaser-oriented activities. Its action against Sullivan is rather based on his participation with ODC in carrying out a fraudulent sale.

Sullivan as a Proper Securities Law Defendant

Sullivan’s remaining attacks are on the propriety of suing him under any of the securities laws Excalibur calls upon. That necessitates a separate look at each statutory provision.

1. Sections 12(2) and 17(a)

Sections 12(2) and 17(a) speak in nearly identical terms in specifying who may be held liable. Despite that parallel language, some of the case law has expanded liability under Section 17(a) to a broader range of persons than under Section 12(2).

Thus Section 17(a) labels as equivalent to a “seller”—and therefore renders liable— anyone who merely “aids and abets” in a sale. SEC v. Coven, 581 F.2d 1020, 1028 (2d Cir.1978). By contrast, although a number of courts have similarly extended Section 12(2) liability to all those who participate actively in the illegal sale of securities (see, e.g., In re Caesars Palace Securities Litigation, 360 F.Supp. 366, 383 (S.D. N.Y.1973)), other authority (see, e.g., the discussion in Briggs v. Sterner, 529 F.Supp. 1155, 1172-73 (S.D.Iowa 1981)) has rejected the “aiding and abetting” theory under that section.

For present purposes, however, any such distinction is wholly academic. As the following discussion reflects, Sullivan qualifies as a seller even under a narrower reading of Section 12(2), thus rendering unnecessary any analysis in broader Section 17(a) terms.

Sullivan claims his preparation of title reports for ODC—both the 1982 title report on the Jackson property and like reports on unrelated properties—form an insufficient basis to impose “seller” liability. Citing Pharo v. Smith, 621 F.2d 656 (5th Cir.), reh’g granted and case remanded, 625 F.2d 1226 (5th Cir.1980), he says his “mere participation” in the events leading up to the transactions does not make him a statutory seller.

But Pharo is of no consolation to Sullivan. Unlike its generalized language (which requires a fleshing out of the “mere participation” notion), numerous authorities (as exemplified by Junker v. Crory, 650 F.2d 1349, 1360 (5th Cir.1981) (reaffirming Pharo), SEC v. Seaboard Corp., 677 F.2d 1289, 1294 (9th Cir.1982) and Hagert v. Glickman, Lurie, Eiger & Co., 520 F.Supp. 1028, 1035 (D.Minn.1981)) contain more precise formulations of what the “seller” concept embraces.

Sullivan clearly falls within any of those formulations as much more than a “mere participant.” His representations as to title were certainly “a substantial factor in causing the transaction^] to take place” {Junker). Excalibur’s injury “flowed directly and proximately from the actions” {Seaboard) of Sullivan—in the classic tort-liability sense requiring only “a” rather than “the” proximate cause. And in Hagert’s terms, Sullivan was “uniquely positioned to ... acquire material information [and] disclose his findings” with regard to the crucial condition of title.

2. Illinois Act

Illinois Act Section 5 requires securities registration by the issuer, controlling person or dealer. Section 13, which establishes rescission as the exclusive civil remedy of a defrauded purchaser (see this Court’s opinion in Guy v. Duff & Phelps, Inc., No. 84 C 2813, slip op. at 20-21 (N.D.Ill. July 12, 1985)) or the purchaser of an unregistered security, limits the class of potential defendants to (Section 13A):

The issuer, controlling person, underwriter, dealer or other person by or on behalf of whom the sale was made, and each underwriter, dealer, or salesperson who shall have participated or aided in any way in making such sale____

See, Shofstall v. Allied Van Lines, Inc., 455 F.Supp. 351, 358 (N.D.Ill.1978).

In Illinois Act terms Excalibur alleges:

1. ODC never registered or qualified the working interests sold to Excalibur.
2. That nonregistration entitles Excalibur to rescission under Section 13.
3. Sullivan, as a “salesperson who ... participated or aided” in the sale, is liable for the rescissionary damages.

Sullivan retorts:

1. No allegations of fact place him within the category of those liable under Section 13.
2. In particular, his past occasional employment by ODC in preparing the 1982 Jackson property title report and other title reports does not render him a “salesperson” under Section 137.2-9:
“Salesperson” means an individual, other than an issuer or a dealer, employed, authorized or appointed by a dealer, issuer or controlling person to sell securities.

No reported Illinois ease has interpreted that definition of “salesperson.” This Court is therefore left with the statutory language alone.

But as an aid to construction, it is profitable to compare the scope of the Illinois Act with that of the 1933 and 1934 Acts, under which this opinion has already found Sullivan potentially liable. Tcherepnin v. Knight, 389 U.S. 332, 336, 88 S.Ct. 548, 553, 19 L.Ed.2d 564 (1967) teaches the 1933 Act falls into the category of remedial legislation, hence to be broadly construed. And the same is true of the 1934 Act. Not only do the federal statutes afford victims of security fraud a broad range of remedies, but each of Sections 10(b), 12(2) and 17(a) defines those liable for its violation as including “any person” acting in connection with, or in, the offer or sale of any securities. Understandably, then, the cases discussed earlier show how federal courts have read that language expansively to encompass all sorts of persons who participate materially in security sales.

By contrast, the Illinois Act is a far more restrictively structured statute. As this Court held in Guy, it affords only a rescissionary (and not a damages) remedy for violations. Moreover, it more carefully lists and defines the specific classes of persons who may be subjected to liability. Those classes comprise persons who regularly play central and specialized roles in securities transactions and who, pursuant to Section 8, must themselves be registered with the Secretary of State.

Importantly, lawyers are not among those specifically required to be so registered. And after all, Excalibur seeks to characterize a lawyer, retained only to render legal services, as having been “employed, authorized or appointed by [ODC] to sell securities.”

That would do impermissible violence to the normal meaning of language. Gable and others, not Sullivan, solicited Excalibur and induced it to invest in the wells. Excalibur had been “sold” on the desirability of the investment before it ever met Sullivan. He was asked only to confirm that the deal conformed to a portion of Gable’s description, and it was Gable’s description that had already provided all the information on the strength of which Excalibur agreed to purchase. Sullivan’s role in the transaction simply did not render him a “salesperson”

3. West Virginia Act

Quite unlike the Illinois Act (and much like the 1933 and 1934 Acts), the West Virginia Act extends civil liability to a broad category of persons involved in the fraudulent sale of securities. Section 4-410(b) imposes liability not only on the seller “but on every broker-dealer or agent who materially aids in the sale.” It goes on to define “agent” broadly as: any individual other than a broker-dealer who represents a broker-dealer or issuer in effecting or attempting to effect purchases or sales of securities.

As with the Illinois Act, no West Virginia case interpreting the statute has been cited to this Court.

Sullivan maintains:

1. His earlier title work for Gable did not constitute the work of an agent “in effecting or attempting to effect [the] purchases or sales of securities.”
2. ODC never retained him for the purpose of being its agent.

But Sullivan glosses over the more direct role he played in the sales to Excalibur. On the Complaint’s allegations, his face-to-face and direct telephonic representations to Turetzky, at the special request of ODC, were of the very essence of agency. And there is equally no doubt (to quote the statute) that he “materially aid[ed]” in “effecting” the sales.

Conclusion

Only Complaint Count VII succumbs to Sullivan’s Rule 12(b)(6) motion and is dismissed. In all other respects the Complaint survives. Sullivan is ordered to answer the Complaint on or before August 26, 1985.

      . Excalibur is an Illinois corporation with its principal place of business in South Barrington, Illinois (Complaint ¶ 1).

      . Excalibur’s Second Amended Complaint (the "Complaint") reflects its third effort to state a cause of action, and Sullivan is the sole remaining defendant of a group Excalibur originally tried to sue here. As this opinion reflects, the third try proves the charm almost entirely.

      . As with every motion to dismiss, this Court accepts as true the well-pleaded factual allegations of the Complaint, with all reasonable factual inferences drawn in Excalibur’s favor. Wolfolk v. Rivera, 729 F.2d 1114, 1116 (7th Cir.1984). No actual findings of fact are made or implied by that approach.

      . Of course it is not necessarily inconsistent to allege Sullivan represented both parties. Dual representation may be undertaken by lawyers on satisfying ethically-imposed conditions. ABA Code of Professional Responsibility DR 5-105; and see, e.g., Westinghouse Electric Corp. v. Gulf Oil Corp., 588 F.2d 221, 229 (7th Cir. 1978). Under the new ABA Model Rule of Professional Conduct 1.7, such concurrent representation continues to be permissible where the clients consent after consultation and the attorney reasonably believes such representation will not harm his relationship with the original client.

      . That allegation in Complaint ¶ 23 is consistent with the Complaint’s several other allegations that Excalibur told ODC it would not go ahead without assurances of clear title.

      . Excalibur did not address the matter in these terms in its response to Sullivan’s motion, instead taking the position a client may sue his or her own attorney under Section 10(b) and Rule 10b-5. But the Complaint certainly ¿ends itself to the interpretation Sullivan was ODC’s attorney, and Excalibur Mem. 7 treats Sullivan as attorney for both parties.

      . Existence of an attorney-client relationship may be established by the client’s reasonable perception, as well as by the more common consensual basis for such a relationship. Westinghouse Electric Corp. v. Kerr-McGee Corp., 580 F.2d 1311, 1316-20 (7th Cir.1978).

      . Sullivan’s purchase/sale contention (Sullivan Mem. 4) is assertedly based on the language of Complaint ¶ 138, which alleges Sullivan acted wrongly in connection with the "purchase of working interests by Excalibur from Oil Development Company.” Of course that would not be a tenable reading of the allegation, and Sullivan’s "argument” is at best disingenuous.

      . Section 12(2) liability extends to "any person ... who offers or sells a security” under fraudulent circumstances by means of interstate commerce. Section 17(a) similarly refers to fraudulent conduct by "any person in the offer or sale of securities.”

      . Indeed, as noted by Bruns and Haskin, Illinois Law Relating to Securities Dealers, Salesmen and Investment Advisers, 1961 U.Ill.L.F. 240, 245:
      Activities of a typical salesman consist of dealing in securities of varying qualities issued by numerous issuers of varying sizes and widely divergent lines of business. He must know something of how the market operates. He is often called upon to advise customers on the composition of their portfolios as well as on the quality of a particular investment.

      . This conclusion highlights the difference between the "agent" coverage of the West Virginia Act and the narrower "salesperson” coverage of the Illinois Act.


source: Caselaw Access Project

author: WILLIAM C. LEE, District Judge.

license: Public Domain

text:
    Gerald SANDERS, Petitioner, v. CITY OF FORT WAYNE, Respondent.
    Civ. No. F 85-343.
    United States District Court, N.D. Indiana, Fort Wayne Division.
    Aug. 15, 1985.

      Gerald Sanders, pro se.
   ORDER

WILLIAM C. LEE, District Judge.

This matter is before the court upon the petitioner’s Motion to Proceed In Forma Pauperis received July 17, 1985. Petitioner wants this court to grant his petition so that he might file a complaint under 42 U.S.C. § 1983 for alleged violations of his constitutional rights. For the following reasons, the motion to proceed in forma pauperis will be denied.

Petitioner is proceeding pro se. Pro se pleadings are to be liberally construed. Haines v. Kerner, 404 U.S. 519, 92 S.Ct. 594, 30 L.Ed.2d 652 (1972). The district court’s role is to ensure that the claims of pro se litigants are given "fair and meaningful consideration.” Matzker v. Herr, 748 F.2d 1142, 1146 (7th Cir.1984); Caruth v. Pinkney, 683 F.2d 1044, 1050 (7th Cir.1982). This court also recognizes that federal courts have historically exercised great tolerance to ensure that an impartial forum remains available to plaintiffs invoking the jurisdiction of the court without the guidance of trained counsel. Pro se motions and complaints such as the petitioner’s are held to less stringent pleading requirements; rigor in the examination of such motions, complaints and pleadings is inappropriate.

A district court may examine the merits of a suit on a motion to proceed in forma pauperis before the issuance of summons. Wartman v. Milwaukee County Court, 510 F.2d 130 (7th Cir.1975); Ballentine v. Crawford, 563 F.Supp. 627 (N.D. Ind.1983). Liberally construing the allegations of the proposed complaint, petitioner has asserted five claims against the respondent City of Fort Wayne. The first allegation is that the agents and employees of the City “did willfully and wantonly fail to represent or enforce the laws of the Indiana Code by omission or by breach of duty.” The second allegation is that petitioner was confined in the Allen County Jail from November 6, 1984 to June 24, 1985 on a charge of attempted murder and battery without the issuance of any bond or the setting of any bail. The third allegation is that police officers of the City removed the petitioner, from the Lutheran Hospital on November 8, 1984 after only seven days of recuperation from a gunshot wound, thus “causing hurried and negligent diagnosis.” The fourth claim is that certain officers and agents of the City allowed the petitioner to be beaten while in jail by fellow inmates in 1976 and November, 1978. The final claim is that Judge Thomas Ryan of the Allen County Court and Prosecutor James P. Posey of the Allen County Prosecutor’s Office violated petitioner’s rights by setting no bond during the seven months from November, 1984 to June, 1985, by setting an exceedingly high bond, and by attempting to prosecute the petitioner under the Indiana Habitual Offender statutes.

The court finds that the petitioner has failed to allege a meritorious basis for any of the claims in his proposed complaint. The first allegation, relating to a failure to represent and enforce the laws of Indiana, is completely without any factual basis other than the more specific acts set forth in petitioner’s four other claims. To the extent that those four claims fail to state a meritorious action, this conclusory claim must fail as well.

The petitioner’s second claim relates to an alleged failure to set a bail bond for seven months. An examination of the Indiana statutes relating to the setting of bail indicates that the defendant City cannot possibly be responsible for the failure to expeditiously set a bond for the petitioner. I.C. 35-33-8-1, et seq., controls the issuance of bail bonds. In I.C. 35-33-8-3, the statute makes it clear that the court has the power to admit a defendant to bail, and I.C. 35-33-8-4(a) indicates that it is the court’s responsibility to determine the amount of the bail, and if the court fails to set an amount of bail, the sheriff (who is a county, and not a city, official) must present the warrant to the judge of the court so that the judge may then set an amount of bail. In short, the setting of bail is a function of the county courts or county sheriff, and not of the respondent City of Fort Wayne. Thus, the City cannot be liable, and the claim against it would fail.

The third allegation relates to the alleged forcible removal by the City’s police officers of the petitioner from the Lutheran Hospital after the petitioner had been shot in November, 1984. The court takes judicial notice of the fact that this same allegation is the subject of another lawsuit already filed by this petitioner entitled Gerald Sanders v. Allen County Police Department, et al., No. F 85-224, and is thus merely duplicative of other litigation currently pending in this court. It would serve no purpose for the court to allow this petitioner to initiate a second proceeding on exactly the same factual allegation as this previous case. This duplication would therefore mandate dismissal of this cause of action on grounds of judicial economy and therefore this claim would fail on a motion to dismiss.

Petitioner’s fourth claim relates to beatings which occurred in 1976 and 1978. However, a claim under § 1983 (as with any claim) must be filed in a timely fashion in order to be considered; this court must not presented with stale claims. The Supreme Court has held that claims under § 1983 must be treated as personal injury actions for purposes of determining what state statute of limitation will apply to it. Wilson v. Garcia, — U.S. —, 105 S.Ct. 1938, 85 L.Ed.2d 254 (1985). In Indiana, the statute of limitations for personal injury claims is two years. I.C. 34-1-2-2(1). All of the acts alleged in this particular claim relate to events in 1976 and 1978, well beyond the two year period of limitations. Thus, petitioner’s claim would fail because it is time-barred.

The fifth and final claim is directed at the actions of Judge Thomas Ryan and Prosecutor James Posey for failing to set a bond during the seven month period, for the setting of a high bond, and for Prosecutor Posey’s attempt to invoke the Habitual Offender statute against petitioner. The allegations concerning Deputy Prosecutor Posey were the subject of a previous motion to proceed in forma pauperis filed by this petitioner on June 13, 1985. This court, in an order dated June 24, 1985, denied petitioner's motion to proceed in for-ma pauperis on the grounds of prosecutorial immunity in § 1983 actions as set forth in Imbler v. Pachtman, 424 U.S. 409, 96 S.Ct. 984, 47 L.Ed.2d 128 (1976). Sanders v. Allen County Prosecutor’s Office, Civil No. F 85-260. That same analysis would apply to these allegations, and thus the claim against Deputy Prosecutor Posey would fail. Likewise, the allegations concerning Judge Ryan and the failure to set a bond during the seven month period were the subject of a previous petition filed by this petitioner on May 13, 1985. This court, in an order dated May 22, 1985, denied the motion to proceed in forma pauperis on the grounds of judicial immunity under § 1983. Sanders v. Allen County Superior Court, Civil No. F 85-227. Those principles concerning judicial immunity, derived from the Supreme Court’s analysis in Stump v. Sparkman, 435 U.S. 349, 358, 98 S.Ct. 1099, 1105, 55 L.Ed.2d 331 (1978), apply not only to the failure to set bond alleged here, but also to the other acts of Judge Ryan set forth in the fifth allegation of the proposed complaint. Thus, the actions of Judge Ryan would not create a basis for liability under § 1983. Finally, to the extent that the respondent in this case is the City of Fort Wayne, this respondent cannot be held liable for the acts of a county prosecutor or a county judge, since neither are agents nor employees of the City of Fort Wayne.

It is therefore clear that none of the five allegations set forth in the proposed complaint state a substantial basis for a claim against the proposed respondent. Such claims would not survive a motion to dismiss, and for this reason, the motion to proceed in forma pauperis will be denied.

The fact that three of petitioner’s five claims have been the subject of previous recent motions to proceed in forma pauper-is filed by the petitioner mandates a further response from this court. The Seventh Circuit has made it clear that insistence on litigating a question in the face of controlling precedent which removes every colorable basis in law for the litigant’s position amounts to bad faith justifying the imposition of sanctions. Reid v. United States, 715 F.2d 1148, 1154 (7th Cir.1983); Analytica, Inc. v. NPD Research, Inc., 708 F.2d 1263, 1269-70 (7th Cir.1983). Here, petitioner attempts to reassert his claims against the prosecutor and judge who delayed in granting him bail, despite the fact that this court previously held that both the prosecutor and the judge were protected from § 1983 claims by absolute immunity. Naming the City of Fort Wayne as defendant in this motion does not alter this result because those previous orders made clear that the prosecutor and the judge were the parties making the challenged decisions. Thus, this court has sufficient equitable power to assess sanctions because it finds that the petitioner’s claim is pursued in bad faith. See Bittner v. Sadoff & Rudoy Industries, 728 F.2d 820, 828 (7th Cir.1984); Benner v. Negley, 725 F.2d 446, 449 (7th Cir.1984).

In addition, Rule 11 of the Federal Rules of Civil Procedure creates a second source of power to impose sanctions. Rule 11, which governs the signing of pleadings and motions, requires that each pleading or motion be signed by an attorney or the party (if the party is proceeding pro se). The rule then provides:

The signature of an attorney or party constitutes a certificate by him that he has read the pleading, motion, or other paper; that to the best of his knowledge, information and belief formed after reasonable inquiry it is well grounded in fact and is warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law, and that it is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation.

If a pleading violates this rule the court “shall impose” an “appropriate sanction,” which may include the amount of reasonable expenses and attorney’s fees incurred by the other party because of the filing of the pleading or motion.

This court has before assessed Rule 11 sanctions for filing meritless lawsuits, see Snyder v. IRS, 596 F.Supp. 240 (N.D.Ind. 1984); Cameron v. IRS, 593 F.Supp. 1540 (N.D.Ind.1984), and has assessed sanctions for litigating an issue which the court had in a previous order declared to be merit-less. Hilgeford v. Peoples Bank, Portland, Ind., 607 F.Supp. 536 (N.D.Ind.1985). The court therefore finds that it has power to impose Rule 11 sanctions for petitioner’s attempt to relitigate the failure to set bond issue.

The third duplicated claim—involving petitioner’s removal from the hospital after he was shot—is not a meritless claim; this court granted the motion to proceed in for-ma pauperis when petitioner first alleged this claim. However, petitioner makes the same allegation again here, in effect seeking to commence a second case on the same facts as the first.

This court concludes that Rule 11 is addressed to duplicative litigation of potentially meritorious claims just as surely as it is directed toward litigation of meritless claims. The Notes of the Advisory Committee speak of “streamlining] the litigation process by lessening frivolous claims and defenses.” The language of the rule itself speaks of “unnecessary delay.” While this court will readily entertain any lawsuit advancing meritorious claims, it will not countenance multiple lawsuits on the same facts% Such suits waste judicial resources and require duplicative efforts by both court and defendants alike.

The court therefore finds that this motion justifies imposition of a Rule 11 sanction. A fifty dollar ($50.00) fine will be assessed, payable to the Clerk of this court.

The court is also concerned about petitioner’s litigious tendencies. This motion is one of twelve filed by petitioner within the past two months. Two of those motions have been granted, ten have been denied. In order to avoid further duplicative motions and lawsuits, the court hereby puts petitioner on notice of his previous attempts at litigation, so that should he attempt to relitigate these issues, he will do so with full knowledge that this court will impose Rule 11 sanctions. These previous motions and suits include:

Sanders v. Marion V.A. Medical Center, No. F 85-327; Sanders v. Food and Drug Administration, No. F 85-328; and Sanders v. Indiana Dept. of Corrections, No. F 85-332, all relating to the alleged use of Thorazine on petitioner; Sanders v. Fruehauf Trailer Corp., No. F 85-329, relating to Sanders’ employment at Fruehauf;
Sanders v. State of Indiana, No. F 85-330, relating to petitioner’s desire to own a gun;
Sanders v. United States Marine Corp., No. F 85-331, relating to petitioner’s attempts to reenlist;
Sanders v. State of Indiana, No. F 85-'326, relating to petitioner’s alleged treatment under the Indiana Habitual Offender Act;
Sanders v. Allen County Prosecutor, No. F 85-260; Sanders v. Allen County Superior Court, No. F 85-227, and this case, all relating to the setting of petitioner’s bond;
and Sanders v. Lutheran Hospital, No. F 85-226; Sanders v. Allen County Police Dept., No. F 85-224; and this case, all relating to petitioner’s removal from Lutheran Hospital after his gunshot wounds.

The court reiterates that it stands ready to accept meritorious cases. However, this court will not accept duplicative lawsuits that force the unnecessary expenditure of judicial resources.

For the foregoing reasons, the motion to proceed in forma pauperis is DENIED. Petitioner is also hereby ORDERED to pay fifty dollars ($50.00) to the Clerk of this court as a Rule 11 sanction for filing this motion seeking to litigate the issues of his bond and his removal from Lutheran Hospital after he received gunshot wounds.


author: GARRITY, District Judge.

text:
    Charlotte A. WALTERS, Plaintiff, v. PRESIDENT AND FELLOWS OF HARVARD COLLEGE et al., Defendants.
    Civ. A. No. 81-2252-G.
    United States District Court, D. Massachusetts.
    Aug. 15, 1985.

      Holly D. Ladd, Dahlborg & Ladd, Andrea S. Mintz and Wendy A. Kaplan, Cambridge, Mass., for plaintiff.
    Richard Ward, John Mason, Ropes & Gray, Boston, Mass., for Marciano and Pres. & Fellows of Harvard.
    Nancy D. Israel, Office of General Counsel, Cambridge, Mass., for Harvard, Hinsman and Marciano.
   MEMORANDUM AND ORDER ON DEFENDANTS’ MOTION FOR PARTIAL SUMMARY JUDGMENT

GARRITY, District Judge.

This is an action based on the alleged sexual discrimination and harassment of a female employee of Harvard University, which is now before the court on the defendants’ motion for partial summary judgment. The plaintiff, Charlotte Walters, was employed in the Building and Grounds Department of the university. The university is made a party through the President and Fellows of Harvard College (“Harvard”). The individual defendant, Frank Marciano and Kenneth Hinsman, were Walters’ superintendent and foreman respectively.

The facts as alleged in the complaint, and the reasonable inferences which can be drawn therefrom would, if found to be true, establish that Walters was subjected by Marciano and Hinsman to harassment and discrimination in her employment because of her sex and because she had complained of such practices. For the purposes of their motion for partial summary judgment, the defendants do not dispute these facts.

On the basis of findings and conclusions stated in open court at the hearing on this matter held April 17, 1985, the court granted Harvard’s motion for summary judgment on Walters’ claim, contained in H 60 of the complaint, for intentional infliction of emotional distress, but the motion was denied as to Marciano and Hinsman. Summary judgment was also denied at the hearing on Walters’ claim contained in 1159 for breach of contract.

Turning to the remaining counts which are the subjects of defendant’ motion, Walters does not dispute that the defendants are entitled to summary judgment on three of her claims: U 54 of the complaint, which asserts a violation of 42 U.S.C. §§ 1985 and 1987; 1157, a claim under 3 C.F.R. 169, § 202(1); and 1161, a claim for negligent infliction of emotional distress. The defendants’ motion as to these claims shall be granted.

The defendants’ argument that they are entitled to summary judgment on Walters’ claims of violations of M.G.L. c. 151B because she has cited the wrong sections thereof is without merit. Such a technical error in citation, where sufficient notice of the factual basis of the claim has been stated, would not support a motion to dismiss for failure to state a claim much less a motion for summary judgment.

Harvard also argues that Walters’ claim that it aided and abetted discrimination in violation of M.G.L. c. 151B, § 4, subsection 5, fails as a matter of law because there were no actors whom Harvard could aid beyond Harvard employees. Apparently Harvard urges that the university and its employees be considered a single entity for the purposes of c. 151B. Such a ruling would be contrary to the statute’s unambiguous language. Walters has alleged discriminatory acts on the part of the university itself, its supervisory personnel (the individual defendants), and non-party, non-supervisory co-employees. M.G.L. c. 151B, § 4, subsection 5, makes it unlawful “[f]or any person, whether an employer or an employee or not, to aid [or] abet ... the doing of any acts forbidden under this chapter____” Clearly, the statute draws a distinction between an employer and its employees, i.e., the statute does not consider them to be a single entity. Thus, a straightforward reading of the statute leads to the conclusion that an employer can aid or abet its own employees.

The defendants have also moved for summary judgment on Walters’ claim of a violation of Article I of the Constitution of the Commonwealth of Massachusetts. Again, inartful pleading is the impetus behind defendants’ motion. Walters’ allegations have sufficiently stated a cause of action under M.G.L. c. 12, § 11 I, the state statute analogous to 42 U.S.C. § 1983, but Walters cites c. 12, § 11 I only in an introductory paragraph to her complaint, not in the paragraph actually asserting the claim. Once again, however, such technically poor pleading does not entitle the defendants to judgment on Walters’ civil rights claim when the facts she pleads do state such a claim. Furthermore, since defendants’ now have notice of the precise legal claim which Walters asserts, there is no reason to dismiss the claim only to have Walters amend her complaint.

The defendants are entitled to partial summary judgment on Walters’ claim of violation of an implied covenant of good faith in her employment contract. Although there is precedent in this district to the contrary, McKinney v. National Dairy Council, D.Mass.1980, 491 F.Supp. 1108, this court has previously ruled on this issue consistently with the opinions expressed in Crews v. Memorex, D.Mass.1984, 588 F.Supp. 27; Ferrante v. Western Electric Co., D.Mass. April 29, 1983, No. 81-3004-Z; and Barnett v. The Republican Co., D.Mass. June 15, 1984, No. 83-163-F, that an implied covenant of good faith and fair dealing will not be implied where the aggrieved party has adequate and comprehensive remedies available under state or federal statutory schemes. Here, Title VII, 42 U.S.C. § 2000e et seq., and M.G.L. c. 151B are such remedies for Walters’ sexual discrimination claims.

Lastly, the defendants move for partial summary judgment on Walters’ claims of constructive discharge and retaliation for reporting of the alleged discrimination in violation of U.S.C. § 2000e et seq. and M.G.L. c. 151B, § 4, subsection 4. The defendants argue that Walters has failed to exhaust her administrative remedies with respect to these claims and an action on them is therefore barred. We find the defendants’ arguments unpersuasive and therefore deny their motion for summary judgment on these claims, for reasons stated in the following paragraphs.

For the purposes of this discussion the acts forming the basis of the claims at issue can be divided into three categories: (1) a demotion and other acts mentioned in Walters’ complaints before the Equal Employment Opportunity Commission (“EEOC”) and the Massachusetts Commission Against Discrimination (collectively, the “Commissions”), now alleged to be retaliatory, but not identified as such before the Commissions; (2) an involuntary transfer which occurred during the pendency of the complaint before the Commissions, but which was never the subject of a commission complaint; and (3) a constructive discharge which occurred after the commencement of this action.

The relevant test in determining whether [a plaintiff] was required to exhaust her administrative remedies ... is whether the acts alleged in the subsequent Title VII suit are fairly within the scope of the prior EEOC complaint, or the investigation arising therefrom.

Waiters v. Parsons, 3 Cir.1984, 729 F.2d 233.

Thus the scope of a civil action is not determined by the EEOC complaint, but is co-extensive with “the scope of the EEOC investigation which can reasonably be expected to grow out of the charge of discrimination”. Mamos v. School Committee of Town of Wakefield, D.Mass.1983, 553 F.Supp. 989, 992. For example, it has been held that where a complainant before the EEOC has stated factual allegations sufficient to trigger a commission investigation, the failure to fully identify the employer’s motivation will not affect the scope of a resulting lawsuit. Sanchez v. Standard Brands, Inc., 5 Cir.1970, 431 F.2d 455, 462. Thus, Walters’ failure to identify retaliation as a motive for her demotion and the other acts identified in her complaints before the Commissions is not a bar to such a claim in this court.

The civil action may also include “relief for incidents not listed in his original charge to the EEOC ... [which are] like or reasonably related to the allegations of the EEOC charge, including new acts occurring during the pendency of the charge before the EEOC”. Oubichon v. North American Rockwell Corp., 9 Cir. 1973, 482 F.2d 569, 571.

The involuntary transfer alleged by Walters is similar and related to the allegations of discriminatory job assignments and demotion presented to the Commissions. The transfer occurred shortly after the Commission complaints were filed and in view of Walters’ allegations of continuing harassment and the complicity of supervisory personnel who authorized the transfer, it could “reasonably have been expected” that an investigation of the transfer would “grow out of [her] charge of discrimination.” Mamos, supra. Thus the court has jurisdiction over the claim of retaliation based on the involuntary transfer.

The constructive discharge presents a somewhat closer question. Because the issue only arose after Walters left her job, three months after the Commissions had issued a right-to-sue letter, the claim itself could not have been investigated on the basis of Walters’ complaints to the Commissions. However, the facts underlying the constructive discharge are alleged by Walters to be “the egregious terms and conditions of her employment and the cumulative effect of the incidents of harassment and intimidation by the defendants,” which were all within the scope of the EEOC investigation. No incidents subsequent to the involuntary transfer, except perhaps continuing harassment no different than that alleged before the Commissions, are relied upon as supporting the constructive discharge. The policy of promoting conciliation would not be furthered by requiring Walters to submit a second complaint to the Commissions based entirely on acts which have already been investigated by them. See, Waiters v. Parsons, supra, 729 F.2d at 235-36.

Accordingly, in addition to the orders issued in open court during the hearing held April 17, 1985, it is hereby ordered that the defendants’ motion for partial summary judgment be granted in favor of all defendants only with respect to Walters’ claims of violations of 42 U.S.C. §§ 1985 and 1987 (¶ 54), breach of federal contracts under 3 C.F.R. 169 § 202(1) (11 57), negligent infliction of emotional distress (11 61), and violation of an implied covenant of good faith and fair dealing (11 58), and that the motion be denied in all other respects.

      . As Walters explains in her brief, paragraph 50 of the complaint refers to M.G.L. c. 151B, §§ 1, 5 rather than the correct § 4, subsection 1, and paragraph 55 refers to M.G.L. c. 15 IB, § 5 rather than § 4, subsection 5.

      . Because we find that Walters' claims are not barred under this test we do not reach the question of whether to adopt the reasoning of Gupta v. East Texas State University, 5 Cir.1981, 654 F.2d 411, and find an exception to the exhaustion requirement for all retaliatory claims.


author: JACKSON, District Judge.

text:
    UNITED CHRISTIAN SCIENTISTS, David James Nolan and Lucile J. Place, Plaintiffs, v. CHRISTIAN SCIENCE BOARD OF DIRECTORS OF the FIRST CHURCH OF CHRIST, SCIENTIST, Defendant.
    Civ. A. No. 83-3486.
    United States District Court, District of Columbia.
    Aug. 15, 1985.
    Arnold P. Messing, Boston, Mass., for plaintiffs.
    Daniel F. Kolb, Washington, D.C., for defendant.
   MEMORANDUM AND ORDER

JACKSON, District Judge.

Plaintiffs United Christian Scientists (“UCS”), an unincorporated association of religionists, and two individual believers, David James Nolan and Lucile J. Place, seek a declaration of the unconstitutionality of a private copyright law enacted by Congress in 1971 as repugnant to the Establishment and Free Exercise Clauses of the First Amendment to, and the Copyright Clause of Article I, Section 8 of, the U.S. Constitution. Defendant is the governing board of the First Church of Christ, Scientist, of Boston, Massachusetts, also known as the Mother Church, the current owner of the copyright in issue (hereinafter the “Church”). The case is now before the Court on crossmotions for summary judgment. For the reasons set forth below, the Court finds the law to be unconstitutional as having been enacted in violation of the Establishment Clause (and does not, therefore, reach the remaining issues), and will grant plaintiffs’ and deny defendant’s motion for summary judgment.

I.

The undisputed facts are established by the parties’ respective Local Rule 1—9(i) Statements and supporting affidavits.

Defendant First Church of Christ, Scientist, was founded more than a century ago by Mary Baker Eddy. During her lifetime Mrs. Eddy wrote numerous versions of an original sacred work known as Science and Health With Key to the Scriptures (“Science and Health”), the religion’s central theological writing, which, along with the Bible, is regarded as the Pastor of the Christian Science Church. The Church presently publishes the 1906 edition of Science and Health, which incorporates textual changes made by Mrs. Eddy between 1906 and 1910, and it is this so-called “final edition” which the Church makes available worldwide through its network of Christian Science Reading Rooms. Sunday sermons in every Church of Christ, Scientist, are comprised of pre-planned readings from correlative passages of the Bible and the 1906 edition of Science and Health, and are published in advance in the “Christian Science Quarterly,” a Church publication which is widely disseminated, so that individual church members may study the sermons in the week preceding the service.

Mary Baker Eddy copyrighted various editions of Science and Health, the first in 1875 and the last in 1906, but copyrights were never obtained for many versions, and Mrs. Eddy made more than 4,000 changes in the work between 1906 and her death in 1910 alone. Despite extensions obtained under general copyright law, all editions except the 1906 edition had passed into the public domain prior to 1971 when Private Law 92-60, 85 Stat. 857 (1971), was enacted.

In 1976 plaintiff United Christian Scientists, (which claims a current international membership of 11,000 and a mailing list of several thousand more) was formed by a group of adherents to Christian Science who desired to revitalize the religion through proselytism and broad dissemination of all of Mary Baker Eddy’s writings. To that end plaintiffs Nolan and Place, Chairman and a trustee, respectively, of UCS, have established a Christian Science Institute in Hawaii from which they plan to undertake worldwide distribution of Science and Health (and excerpts thereof) in book and audio-cassette form. It is plaintiffs’ belief, however, that the 1906 edition of Science and Health is not the definitive version, and they wish to publish and disseminate other editions of the text for study and teaching, an activity in which plaintiffs assert they are inhibited by the existence of the copyright acquired by defendant by Private Law 92-60.

Private Law 92-60 grants to the trustees under Mary Baker Eddy’s will the copyright to “all editions [of Science and Health ] ... in English and translation heretofore published, or hereafter published by or on behalf of said trustees, their successors or assigns, for a term of seventy-five years from the effective date of this Act or from the date of first publication, whichever is later.” The effective copyright term for all editions of Science and Health extant in 1971 is thus extended until 2046 (and, arguably, subsequently-published editions would each be protected for 75 years from their date of publication).

II.

The Establishment Clause of the First Amendment states that “Congress shall make no law respecting an establishment of religion____” In Everson v. Board of Education, 330 U.S. 1, 67 S.Ct. 504, 91 L.Ed. 711, reh’g denied, 330 U.S. 855, 67 S.Ct. 962, 91 L.Ed. 1297 (1947), the Supreme Court said:

The “establishment of religion” clause of the First Amendment means at least this: Neither a state nor the Federal Government can set up a church. Neither can pass laws which aid one religion, aid all religions, or prefer one religion over another____ Neither a state nor the Federal Government can, openly or secretly, participate in the affairs of any religious organizations or groups and vice versa. In the words of Jefferson, the clause against establishment of religion by law was intended to erect “a wall of separation between Church and State.”

Id. at 15-16, 67 S.Ct. at 511.

The “wall of separation” has never since, to be sure, been conceived of as an impenetrable barrier, see Lemon v. Kurtzman, 403 U.S. 602, 614, 91 S.Ct. 2105, 2112, 29 L.Ed.2d 745, reh’g denied, 404 U.S. 876, 92 S.Ct. 24, 30 L.Ed.2d 123 (1971); Committee for Public Education v. Nyquist, 413 U.S. 756, 760-61, 93 S.Ct. 2955, 2958-59, 37 L.Ed.2d 948 (1973); Lynch v. Donnelly, 465 U.S. 668, 104 S.Ct. 1355, 1361-62, 79 L.Ed.2d 604, reh’g denied, — U.S. —, 104 S.Ct. 2376, 80 L.Ed.2d 848 (1984), and the fact that a law may operate to the advantage of religion certainly does not alone render it unconstitutional. See Mueller v. Allen, 463 U.S. 388, 393, 103 S.Ct. 3062, 3065, 77 L.Ed.2d 721 (1983); Lynch v. Donnelly, 104 S.Ct. at 1362. But Establishment Clause apprehensions are nevertheless aroused whenever governmental action appears to bestow an official beneficence on religion in general, or on a particular denomination or sectarian enterprise, for, as the Supreme Court has most recently said, “Government promotes religion as effectively when it fosters a close identification of its powers and responsibilities with those of any—or all—religious denominations as when it attempts to inculcate specific religious doctrines.” Grand Rapids School District v. Ball, — U.S. —, 105 S.Ct. 3216, 3226, 87 L.Ed.2d 267 (1985). Where legislatures have succeeded in conferring benefits upon. religious entities without offending the Establishment Clause there have been factors present which have attenuated the appearance of official favor, such as that the benefits were indirect or remote, Committee for Public Education v. Nyquist, 413 U.S. at 771, 93 S.Ct. at 2964; Widmar v. Vincent, 454 U.S. 263, 273-74, 102 S.Ct. 269, 276, 70 L.Ed.2d 440 (1981), or that the suspect legislation distributed its bounty among the secular and sectarian alike and was formulated with a general public policy goal in mind.

The inquiry which must be made with respect to Private Law 92-60 is not simply reducible, as defendant would have it, to whether religions- may ever derive benefit from private acts of Congress, or whether original works of theological import may ever be given the protection of copyright. They may, and they obviously have, but the issue is considerably more complex. Whimsical as its results may seem in particular cases, see Wallace v. Jaffree, — U.S. —, 105 S.Ct. 2479, 2517-19, 86 L.Ed.2d 29 (1985) (Rehnquist, J., dissenting), the Supreme Court has articulated a three-part test to be utilized by courts in assaying legislation which provokes Establishment Clause challenges:

First, the statute must have a secular legislative purpose; second its principal or primary effect must be one that neither advances nor inhibits religion ...; finally, the statute must not foster “an excessive government entanglement with religion.”

Lemon v. Kurtzman, 403 U.S. at 612-13, 91 S.Ct. at 2111 (citations omitted).

Applying the Lemon test to the law in dispute here, the Court finds that it is the benefit to members of the general public, if any, which is incidental or remote; aid to “religion” is at the heart of the legislation. Private Law 92-60 was openly sought and passed to secure prospective advantage for the hierocracy of one particular religion, and to no discernible advancement of the general welfare, circumstances which render it vulnerable under both parts one and two of the Lemon test and incompatible as well with the general principle of governmental neutrality toward religion the First Amendment commands. See, e.g., Buckley v. Valeo, 424 U.S. 1, 92, 96 S.Ct. 612, 669, 46 L.Ed.2d 659 (1976) (per curiam); Committee for Public Education v. Nyquist, 413 U.S. at 792-93, 93 S.Ct. at 2975; Wallace v. Jaffree, 105 S.Ct. at 2492.

Defendant Church suggests that Private Law 92-60 shares the secular purpose common to all copyright legislation, viz., to “stimulate artistic creativity for the general public good.” Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 156, 95 S.Ct. 2040, 2044, 45 L.Ed.2d 84 (1975). See also Washingtonian Publishing Co. v. Pearson, 306 U.S. 30, 36, 59 S.Ct. 397, 400, 83 L.Ed. 470 reh’g denied, 306 U.S. 668, 59 S.Ct. 588, 83 L.Ed. 1063 (1939). But it is certain that the only author of the only literary work which is the subject of this particular copyright law will not resume her creative efforts reassured by any protection it affords her heirs, temporal or spiritual. The Church also cites to excerpts from the legislative history which intimate that Private Law 92-60 was intended to safeguard against “spurious or distorted” versions of Science and Health being “palmed off” upon the public as the genuine article. But that same legislative history in its entirety makes it clear that, when the bill which was to become Private Law 92-60 was under consideration, neither the lawmakers nor those who importuned them on its behalf had in mind to protect the public’s purely profane interest in not being cheated. To the extent they were bent on saving the public at all, it was from false doctrine, not fraud.

In testimony given before the House subcommittee considering the bill the manager of the Washington office of the Christian Science Committee on Publication asserted that “the unusual nature” of Science and Health necessitated his plea for extended copyright protection, for without such protection “there would be a serious danger that the course of Christian Science church services and the basis of individual religious study by Christian Scientists would be seriously impaired.” For the Relief of Clayton Bion Craig, Arthur P. Wuth, Mrs. Lenore D. Hanks, David E. Sleeper, and DeWitt John: Hearings on S. 1866 Before Subcomm. No. 3 of the House Committee on the Judiciary, 92d Cong., 1st Sess. 7-8 (1971). Another Church witness inveighed: “We have got to protect religion, we have got to protect what God wants His children to hear.” Id. at 22. The bill’s sponsor, Senator Burdick, urged its passage as follows:

[I]t is absolutely essential to the free practice of their religious beliefs that Christian scientists, as well as those of the general public who wish to learn of this religion, be certain that any copy of Science and Health which they obtain be exactly the same as originally copyrighted by its author____ If the copyright of Science and Health With Key to the Scriptures should ever be permitted to expire, the book would fall into the public domain. Amended editions, annotated versions, modernized editions, and abridged editions could all be published and would cause great distress and confusion, not only among Christian Scientists, but among those of the general public wishing to obtain a correct and complete statement of the teachings of this religion.

117 Cong.Rec. S 26822 (1971). And, according to the Senate committee report:

The purpose of seeking copyright for this book is not to provide pecuniary profit or material gain for the Trustees or the Church, but to preserve and maintain the purity and integrity of the statement of the religious teachings of this denomination, and thereby to protect members of the public against the possibility that, in purchasing or otherwise acquiring ... [,Science and Health ], they might receive a distorted version of the teachings of Christian Science.

S.Rep. No. 92-280, 92d Cong., 1st Sess. (1971) (reprinted at 117 Cong.Rec. S 26821 (1971)).

Such proceedings have the sound of the 17th century to them. They are resonant of what might have occurred before the Committee on Religion of the last Parliament to sit before the English Revolution, but they are discordant in the context of contemporary American political debate. Heresy is no part of the business entrusted to Congress by the Constitution.

Finally, it is by no means assured that even the third part of the Lemon test—the absence of “excessive entanglement”—can be successfully negotiated to allow Private Law 92-60 to stand. While the law is unlikely to entail much in the way of administrative oversight, the same cannot be said with respect to further judicial engagement. Both UCS and the Church are in accord that it is essential that the “purity” and “integrity” of Science and Health not be compromised. The Church professes that the text of the book must be exactly as Mary Baker Eddy wrote it, and that every detail, from the numbering of the pages to the arrangement of lines on each page, must be identical in all published copies of the same edition. Given Mrs. Eddy’s prolificacy and the fact that the early versions of the book are very different from those that followed, ascertainment of the definitive version is likely to be both controversial and difficult, and even if a consensus were possible, plaintiffs maintain that they would still wish to publish and distribute earlier versions of the work to illuminate the course of Mrs. Eddy’s revelation.

As with most copyright disputes, those arising under Private Law 92-60 will in all probability be resolved by resort to private litigation, in connection with which courts could be called upon to determine, for example, as to particular portions of her works, whether Mary Baker Eddy purported to write ex cathedra as the divinely inspired prophet of a new faith, or in some less exalted capacity, merely to decide whether they are within or without the copyright. Such controversies are best left to the theologians or to ecclesiastical tribunals, not the civil courts of the land.

For the foregoing reasons, therefore, it is, this 14th day of August, 1985,

ORDERED, that defendant’s motion for summary judgment is denied; and it is

FURTHER ORDERED, that plaintiffs’ motion for summary judgment is granted, and Private Law 92-60 is hereby declared to be unconstitutional; and it is

FURTHER ORDERED, that the copyright conferred by Private Law 92-60 is held to be null, void, and of no effect; and it is

FURTHER ORDERED, sua sponte, that the judgment entered hereby is stayed pending appeal.

      . Jurisdiction is predicated upon 28 U.S.C. §§ 1331, 1338 and 1346. The original defendant, the U.S. Register of Copyrights, was dismissed on June 14, 1984, the Church having been added as a defendant as the real party in interest.

      . General copyright legislation in effect between 1831 and 1909, the period in which Mary Baker Eddy herself published, provided for an initial copyright term of 28 years and a 14-year renewal term. Act of February 3, 1831, 4 Stat. 436. In 1909, Congress amended the statute to provide for an initial term of protection of 28 years and a renewal term of 28 years. Act of 1909, 35 Stat. 1075. As a consequence, renewal in 1934 of the copyright registration for the 1906 edition of Science and Health extended it until 1962, when it would have expired but for year-to-year extensions enacted by Congress pending its revision of the Copyright Act. That revision, passed in 1976, established a copyright term of the lifetime of the author plus 50 years. 17 U.S.C. § 302(a). The 1976 Act also provided that copyrights extended under the yearly acts would expire 75 years from the date the copyright was originally obtained, which, in the case of the 1906 edition, was 1981. 17 U.S.C. § 304(b).

      . The trustees under Mrs. Eddy’s will are the members of the Board of Directors of the Church, although defendant asserts that the two groups are not necessarily coextensive.

      . The Supreme Court has held constitutional a number of programs benefitting sectarian institutions. See, e.g., Everson v. Board of Education, supra, (reimbursement of costs of bus transportation to parents of parochial school students); Board of Education v. Allen, 392 U.S. 236, 88 S.Ct. 1923, 20 L.Ed.2d 1060 (1968) (loan of secular textbooks to all schoolchildren, whether in public or private schools); Tilton v. Richardson, 403 U.S. 672, 91 S.Ct. 2091, 29 L.Ed.2d 790, reh’g denied, 404 U.S. 874, 92 S.Ct. 25, 30 L.Ed.2d 120 (1971) (federal grants to private colleges and universities for construction of facilities to be used for secular purposes); Walz v. Tax Commission, 397 U.S. 664, 90 S.Ct. 1409, 25 L.Ed.2d 697 (1970) (property tax exemptions to religious organizations).

      . Defendant has submitted evidence of some 77 current copyrights on theological writings, including 34 separate translations or editions of the Bible. It has also cited 24 private acts of Congress since 1946 which have conferred benefits upon a multitude of religious organizations.

      . Although the Supreme Court has characterized this test as "no more than [a] helpful signpost" in analyzing Establishment Clause challenges, Mueller v. Allen, 463 U.S. at 394, 103 S.Ct. at 3066 (quoting Hunt v. McNair, 413 U.S. 734, 741, 93 S.Ct. 2868, 2873, 37 L.Ed.2d 923 (1973)), it has itself nevertheless employed it in all but one such case, Marsh v. Chambers, 463 U.S. 783, 103 S.Ct. 3330, 77 L.Ed.2d 1019 (1983), and its continued vitality is evidenced by three recent decisions. Wallace v. Jaffree, supra; Grand Rapids School District v. Ball, 105 S.Ct. at 3223 (“We therefore reaffirm that state action alleged to violate the Establishment Clause should be measured against the Lemon criteria.”); Aguilar v. Felton, — U.S. —, 105 S.Ct. 3232, 87 L.Ed.2d 290 (1985).

      . The Church presently receives some royalties from the sale of Science and Health, but neither party contends that pecuniary interests underlie its posture in this case.

      . Congress was made aware, even before the appearance of the UCS schismatics, of the bill’s particularly great propensity for involving government in a wholly internal religious dispute over the integrity of a sacred work. The report of the Bar Association of the City of New York, which recommended rejection of the legislation, and argued in no uncertain terms its unconstitutionality, stated:
      [W]e confess ourselves unable to perceive how S. 1866 can be other than unconstitutional. Its purpose and its ultimate effect are to single out a particular doctrine within a particular church, to grant to writings embodying that doctrine protection that has never been made available to any other religious or nonreligious writings, and to supply civil and criminal sanctions against those who, religiously or non-religiously, whether calling themselves Christian Scientists or not, may choose to deviate from that doctrine____ [I]ronicalIy, S. 1866 would deprive Christian Science dissidents of the right ... to select their own "sacred writings" if those writings happened to be those of Mary Baker Eddy.
      117 Cong.Rec. S 46071-72 (1971).


author: BILLINGS, District Judge.

text:
    BURLINGTON DRUG COMPANY, INC. v. ROYAL GLOBE INSURANCE COMPANY.
    Civ. A. No. 85-54.
    United States District Court, D. Vermont.
    Aug. 15, 1985.

      H. Joseph Gamache, Sylvester & Maley, Burlington, Vt., for plaintiff.
    John M. Dinse, Dinse, Erdmann & Clapp, Burlington, Vt., for defendant.
   OPINION AND ORDER

BILLINGS, District Judge.

This suit was filed as a declaratory judgment action, wherein Plaintiff Burlington Drug Company, Inc. (hereinafter BDC) requested a ruling that Defendant Royal Globe Insurance Company, one of the Plaintiff’s insurers, is obligated to defend BDC in a separate action filed by the United States naming BDC as a defendant. On June 4, 1985, this Court ruled that, pursuant to the terms of its insurance policy with Plaintiff, Defendant Royal Globe has a duty to defend BDC in the underlying suit. BDC now seeks an award of attorney’s fees incurred in connection with this suit, as well as fees incurred in its defense of the underlying action.

The general rule in Vermont is that, absent a statute or contract to the contrary, each party must bear their own expenses of litigation. Welch v. LaGue, 141 Vt. 644, 451 A.2d 1133 (1982); Albright v. Fish, 138 Vt. 585, 422 A.2d 250 (1980); Loeb v. Loeb, 120 Vt. 489, 144 A.2d 825 (1958). This rule has been applied in declaratory judgment cases, where an insured seeks an order regarding the insurer’s duty to defend. In Jefferson-Pilot Fire and Casualty Co. v. Boothe, Prichard & Dudley, 638 F.2d 670 (4th Cir.1980) (applying Virginia law), for example, the court ruled that “[wjhile we understand [the insured’s] unhappiness at having to use its own resources in order to sue [the insurer], we are obliged to follow the well settled Virginia rule that absent a contractual obligation or statutory provision to the contrary, a party sued for breach of contract and found liable does not have to compensate the injured party for its costs in bringing the action.” Id. at 676. In this case, we are aware of no contractual obligation or statutory provision which would allow Plaintiff to recover fees incurred in this case.

In support of its request for fees incurred in this declaratory judgment action, BDC relies in part on Utilities Construction Corp. v. Peerless Insurance Co., 233 F.Supp. 64 (D.Vt.1964). The judgment order in that case ordered the insurer to reimburse the insured for the insured’s fees incurred in bringing a declaratory judgment action seeking a ruling of coverage. Insofar as the court there did not state any grounds for its award of fees in the declaratory judgment action, we decline to use the Utilities case as viable precedent in this case. Therefore, Plaintiff’s request for an award of fees expended in connection with this declaratory judgment action must be denied.

We are mindful, however, of the apparent burden our ruling, and the Vermont law on the issue, places on insureds. Without any sanction for a refusal to defend, the onus is placed on the insured to bring a declaratory judgment action to order the insurer to defend. It would thus be to the insurer’s advantage to wait for the insured to bring such a suit before undertaking to defend in the underlying action. On the other hand, an insurer should be permitted to make a good faith determination of no coverage without suffering a penalty if it is later determined that the insurer’s decision was erroneous. Therefore, we believe an award of attorney’s fees in a declaratory judgment action such as this should be permitted, but only where there is a showing that the insurer’s denial of coverage was made in bad faith or with vexatious disregard for the terms of the policy or the claims against the insured. See, e.g., Columbia Union National Bank v. Hartford, Accident and Indemnity Co., 669 F.2d 1210 (8th Cir.1982) (construing Missouri statute); Conway v. Country Casualty Insurance Co., 92 Ill.2d 388, 65 Ill.Dec. 934, 442 N.E.2d 245 (1982). In this case, BDC has proffered no evidence that, in denying coverage, Royal Globe acted in bad faith. Accordingly, even if Vermont followed the “bad faith” rule, BDC’s request for fees would fail.

With regard to Plaintiff’s request for an award of fees incurred in the underlying suit, the general rule is that such fees, to the extent reasonable, may be recovered. Where an insured is forced to defend suit because his insurer denies coverage, the insured may recover attorney’s fees expended in that defense if it is determined that the insurer was, in fact, obligated to defend. Buntin v. Continental Insurance Co., 525 F.Supp. 1077, 1083 (D.V.I. 1981) . Where, however, the suit contains claims which the insurer is not obligated to defend, the question arises whether the insured is entitled to recover all fees expended in defense of the suit. In such a situation, courts generally apportion the fees where the non-covered claims can “clearly be distinguished from the covered claims.” Crist v. Insurance Co. of North America, 529 F.Supp. 601, 604 (D.C.Utah 1982) . Where the covered and non-covered claims cannot be so distinguished, the insurer will be liable for all fees expended. Id. at 604. This is in part because an insurer’s obligation to defend is greater than its obligation to indemnify. Id. See also State of Vermont v. Glens Falls Insurance Company, Inc., 132 Vt. 97, 315 A.2d 257 (1974).

In this case, there is no question that the underlying suit involve both covered and non-covered claims. The Government claims that it has a prior-perfected security interest in inventory belonging to the West Rutland Pharmacy, that BDC was aware of the Government’s prior interest, but that BDC nevertheless executed a possessory writ of attachment against the same inventory. The Pells, guarantors on a note executed by West Rutland Pharmacy to the Government, claim that, as one of West Rutland’s creditors, BDC harassed them in an effort to collect on certain debts. The Pells claim this conduct lasted for a period of approximately one year and caused them bodily injury and emotional distress. The Government’s claim is clearly not covered by the Royal Globe policy, whereas the Pell’s claim is covered. This point is not in dispute.

The question is whether the claims asserted against BDC by the Government and by the Pells are distinguishable. Proof of the Government’s claim will largely be a matter of determining priority of interest under Vermont’s commercial code. See, e.g., Greg Restaurant Equipment & Supplies, Inc. v. Valway, 144 Vt. 59, 472 A.2d 1241 (1984). Reading the Government’s claim broadly, it may be construed to contain a claim of intentional interference with contract. Nevertheless, however broadly the claim is construed, the facts sustaining the claim will revolve around BDC’s conduct vis-a-vis the Government. On the other hand, proof of the Pells’ claims will largely involve facts concerning BDC’s conduct for the year during which it is alleged BDC tried to collect West Rutland’s debts from the Pells. Proof of the claim may also involve BDC’s conduct in executing the possessory writ of attachment. But, once again, no matter how broadly the Pells’ claim is read, it will certainly be limited to BDC’s conduct vis-a-vis the Pells. For these reasons, we think the Government’s and the Pells’ claims are distinguishable and, therefore, BDC's attorney’s fees must be apportioned accordingly.

At the hearing on this matter, it was agreed that a fee of $65.00 per hour was a reasonable rate for this type of case. After reviewing BDC’s attorney’s affidavit filed in support of his motion for fees, the court has concluded that approximately thirty-seven (37) hours were spent on defense of the Pells’ cross-claims or on matters related thereto. Therefore, BDC is entitled to $2,405 in attorney’s fees. Although not specifically addressed at the hearing, the Court has determined that BDC is entitled to an additional $165.60 in disbursements incurred by its attorney.

ORDER

Based on the foregoing, it is hereby ORDERED and ADJUDGED that Defendant Royal Globe Insurance Company is liable to Plaintiff Burlington Drug Company for attorney’s fees and costs in the amount of $2,570.60.

SO ORDERED.

      . In the primary suit, the United States has named Daniel and Frances Kennedy, James and Rebecca Pell, Authur and Sharon Drolet, Burlington Drug Company, Inc. and James and Joseph Valz as defendants. The primary suit is an action to collect on a promissory note executed by the West’ Rutland Pharmacy, Inc. and assigned to the Small Business Administration. In count I of its complaint, the United States claims, inter alia, that Defendants James and Rebecca Pell, as guarantors of the note, are liable for the sums due and owing. In count II of the complaint, the United States claims that Burlington Drug executed a possessory writ of attachment on the inventory of the West Rut-land Pharmacy when it knew that the United States had a prior interest in the same collateral.
      Shortly after filing the complaint, Defendants Pell filed a cross claim against BDC, claiming that it had harassed them in an effort to collect certain debts the West Rutland Pharmacy owed BDC. The Pells claim BDC’s conduct in collecting the debts was harassing and caused them injury. We held that the Pells’ claims are covered under BDC’s insurance policy with Royal Globe.

      . Vermont’s Declaratory Judgment Act does provide for the award of costs where equitable and just. See 12 V.S.A. § 4720. However, although the Act, as a remedial statute, should be read broadly, we think it clear that, as used in the statute, "costs" do not include attorney’s fees. See Black’s Law Dictionary, 5th ed. (costs do not include attorney’s fees unless such fees are by statute denominated as costs). Any other reading of the statute would be overbroad and unwarranted.

      . The following is a list of dates for which the Court has permitted attorney’s fees: 5/20/82, 5/24/82, 2/14/84, 12/11/84, 1/10/85, 1/11/85, 4/3/85, 4/12/85, 4/24/85, 5/1/85, 5/2/85, 5/8/85, 5/15/85, 5/21/85, 5/22/85, and 5/31/85.