KRS 292.480: Civil liabilities.

(1) Any person, who offers or sells a security in violation of this chapter or of any rules

or orders promulgated hereunder or offers or sells a security by means of any untrue

statement of a material fact or any omission to state a material fact necessary in

order to make the statements made in the light of the circumstances under which

they are made not misleading, and who does not sustain the burden of proof that he

did not know and in the exercise of reasonable care could not have known of the

untruth or om ission is liable to the person buying the security from him, who may

sue either at law or in equity to recover the consideration paid for the security,

together with interest at the legal rate from the date of payment costs and reasonable

attorneys' fees, less the amount of any income received on the security, upon the

tender of the security, or for damages if he no longer owns the security. Damages

are the amount that would be recoverable upon a tender less:

(a) The value of the security when the buyer is disposed of it; and

(b) Interest at the legal rate per annum from the date of disposition.

(2) Any person who purchases a security in violation of this chapter or of any

administrative regulations or orders promulgated under this chapter or who

purchases a security by means of any untrue statement of a material fact or any

omission to state a material fact necessary in order to make the statements made in

light of the circumstances under which they are made not misleading, the seller not

knowing of the untr uth or omission, and who does not sustain the burden of proof

that he did not know and in the exercise of reasonable care could not have known of

the untruth or omission is liable to the person selling the security to him, who may

sue either at law or in equity for:

(a) A return of the security, together with any income received by the purchaser

on the security, costs, and reasonable attorney's fees, upon a tender of the full

amount of the consideration received for the security; or

(b) If the purchaser no longer owns the security, the difference between the fair

value of the security at the date of the transaction and the consideration

received for the security, together with interest on the difference at the legal

rate compounded annually from the date of the transaction, and costs and

reasonable attorney's fees.

(3) For purposes of paragraph (b) of subsection (2) of this section, when the purchaser

no longer owns the security, if a seller seeking relief under paragraph (b) of

subsection (2) of this section offers and presents admissible evidence of the highest

intermediate value of the subject security as of some specific date occurring within

a reasonable period of time after the date of the sale of the security but no later than

the date an action under paragraph (b) of subsection (2) of this section is filed, or of

the total consideration received by the purchaser in a subsequent sale of that

security, it shall be presumed until rebutted by a preponderance of evidence to the

contrary that the value or sale price, as applicable, is the fair value of the security at

the date of the transaction as those terms are used in paragraph (b) of subsection (2)

of this section to measure damages. For purposes of subsections (1) and (2) of this

section and all other pr ovisions of this chapter, statements and omissions may be

either oral or written.

(4) Every person who directly or indirectly controls a seller or purchaser liable under

subsection (1) or (2) of this section, every partner, officer, or director (or person

occupying a similar status or performing similar functions) or employee of a seller

or purchaser who materially aids in the sale or purchase, and every broker -dealer or

agent who materially aids in the sale or purchase is also liable jointly and severally

with and to the same extent as the seller or purchaser, unless the nonseller or

nonpurchaser who is so liable sustains the burden of proof that he did not know, and

in the exercise of reasonable care could not have known, of the existence of the

facts by reason of which the liability is alleged to exist. There is contribution as in

cases of contract among the several persons so liable.

(5) Any tender specified in this section may be made at any time before entry of

judgment. Every cause of action under this statute survives the death of any person

who might have been a plaintiff or defendant. No person may sue under this section

more than three (3) years after the date the occurrence of the act, omission, or

transaction constituting a violation of this chapter was discovered, or in the exercise

of reasonable care should have been discovered. No person may sue under this

section:

(a) If the buyer received a written offer, before suit and at a time when he owned

the security, to refund the consideration paid to gether with interest at the legal

rate from the date of payment, less the amount of any income received on the

security, and he failed to accept the offer within thirty (30) days of its receipt;

(b) If the buyer received an offer before suit and at a time when he did not own

the security, unless he rejected the offer in writing within thirty (30) days of its

receipt; or

(c) If paragraph (b) of subsection (2) of this section applies, and if the seller

received a written offer before suit equal to the differe nce between the greater

of the highest intermediate value of the security or the consideration received

by the purchaser upon disposal of the security and the consideration received

by the seller for the security, together with interest on the difference a t the

legal rate from the date of the transaction; or if paragraph (a) of subsection (2)

of this section applies, and if the seller received a written offer to return the

security together with any income received by the purchaser on the security;

and in e ither case he failed to accept the offer within thirty (30) days of its

receipt.

(6) No person who has made or engaged in the performance of any contract in violation

of any provision of this chapter or any rule or order hereunder, or who has acquired

any purported right under any contract with knowledge of the facts by reason of

which its making or performance was in violation, may base any suit on the

contract. Any condition, stipulation, or provision binding any person acquiring any

security to waive compliance with any provision of this chapter or any rule or order

hereunder is void.

(7) A person who receives directly or indirectly any consideration for providing

investment advice to another person and who employs a device, scheme, or artifice

to defraud the other person or engages in an act, practice, or course of business that

operates or would operate as a fraud or deceit on the other person, is liable to the

other person. The person defrauded may maintain an action to recover the

consideration paid fo r the advice and the amount of any actual damages caused by

the fraudulent conduct, interest at the legal rate of interest from the date of the

fraudulent conduct, costs, and reasonable attorney's fees determined by the court,

less the amount of any income received as a result of the fraudulent conduct.

(8) The rights and remedies provided by this section are in addition to any other rights

or remedies that may exist at law or in equity.