N-Phenoxyphthalimides react with AlCl3 in benzene to form products of intra
molecular N-C and intermolecular C-C bond formation via aryloxenium ion int
ermediates. N-Phenoxy derivatives having an electron-withdrawing substituen
t on the para position react with solvent benzene on the imide carbonyl, as
sisted by the neighboring oxygen atom, to produce N-(4-substituted phenoxy)
-3,3-diphenyl-2,3-dihydroisoindol-1-ones.