{"data":{"id":"us-ky/krs-292.480","jurisdiction":"us-ky","citation":"KRS 292.480","heading":"Civil liabilities.","body":"(1) Any person, who offers or sells a security in violation of this chapter or of any rules\nor orders promulgated hereunder or offers or sells a security by means of any untrue\nstatement of a material fact or any omission to state a material fact necessary in\norder to make the statements made in the light of the circumstances under which\nthey are made not misleading, and who does not sustain the burden of proof that he\ndid not know and in the exercise of reasonable care could not have known of the\nuntruth or om ission is liable to the person buying the security from him, who may\nsue either at law or in equity to recover the consideration paid for the security,\ntogether with interest at the legal rate from the date of payment costs and reasonable\nattorneys' fees, less the amount of any income received on the security, upon the\ntender of the security, or for damages if he no longer owns the security. Damages\nare the amount that would be recoverable upon a tender less:\n(a) The value of the security when the buyer is disposed of it; and\n(b) Interest at the legal rate per annum from the date of disposition.\n(2) Any person who purchases a security in violation of this chapter or of any\nadministrative regulations or orders promulgated under this chapter or who\npurchases a  security by means of any untrue statement of a material fact or any\nomission to state a material fact necessary in order to make the statements made in\nlight of the circumstances under which they are made not misleading, the seller not\nknowing of the untr uth or omission, and who does not sustain the burden of proof\nthat he did not know and in the exercise of reasonable care could not have known of\nthe untruth or omission is liable to the person selling the security to him, who may\nsue either at law or in equity for:\n(a) A return of the security, together with any income received by the purchaser\non the security, costs, and reasonable attorney's fees, upon a tender of the full\namount of the consideration received for the security; or\n(b) If the purchaser no longer owns the security, the difference between the fair\nvalue of the security at the date of the transaction and the consideration\nreceived for the security, together with interest on the difference at the legal\nrate compounded annually from the date of the transaction, and costs and\nreasonable attorney's fees.\n(3) For purposes of paragraph (b) of subsection (2) of this section, when the purchaser\nno longer owns the security, if a seller seeking relief under paragraph (b) of\nsubsection (2) of this section  offers and presents admissible evidence of the highest\nintermediate value of the subject security as of some specific date occurring within\na reasonable period of time after the date of the sale of the security but no later than\nthe date an action under paragraph (b) of subsection (2) of this section is filed, or of\nthe total consideration received by the purchaser in a subsequent sale of that\nsecurity, it shall be presumed until rebutted by a preponderance of evidence to the\ncontrary that the value or sale price, as applicable, is the fair value of the security at\nthe date of the transaction as those terms are used in paragraph (b) of subsection (2)\nof this section to measure damages. For purposes of subsections (1) and (2) of this\nsection and all other pr ovisions of this chapter, statements and omissions may be\neither oral or written.\n(4) Every person who directly or indirectly controls a seller or purchaser liable under\nsubsection (1) or (2) of this section, every partner, officer, or director (or person\noccupying a similar status or performing similar functions) or employee of a seller\nor purchaser who materially aids in the sale or purchase, and every broker -dealer or\nagent who materially aids in the sale or purchase is also liable jointly and severally\nwith and to the same extent as the seller or purchaser, unless the nonseller or\nnonpurchaser who is so liable sustains the burden of proof that he did not know, and\nin the exercise of reasonable care could not have known, of the existence of the\nfacts by reason of which the liability is alleged to exist. There is contribution as in\ncases of contract among the several persons so liable.\n(5) Any tender specified in this section may be made at any time before entry of\njudgment. Every cause of action under this  statute survives the death of any person\nwho might have been a plaintiff or defendant. No person may sue under this section\nmore than three (3) years after the date the occurrence of the act, omission, or\ntransaction constituting a violation of this chapter was discovered, or in the exercise\nof reasonable care should have been discovered. No person may sue under this\nsection:\n(a) If the buyer received a written offer, before suit and at a time when he owned\nthe security, to refund the consideration paid to gether with interest at the legal\nrate from the date of payment, less the amount of any income received on the\nsecurity, and he failed to accept the offer within thirty (30) days of its receipt;\n(b) If the buyer received an offer before suit and at a time when he did not own\nthe security, unless he rejected the offer in writing within thirty (30) days of its\nreceipt; or\n(c) If paragraph (b) of subsection (2) of this section applies, and if the seller\nreceived a written offer before suit equal to the differe nce between the greater\nof the highest intermediate value of the security or the consideration received\nby the purchaser upon disposal of the security and the consideration received\nby the seller for the security, together with interest on the difference a t the\nlegal rate from the date of the transaction; or if paragraph (a) of subsection (2)\nof this section applies, and if the seller received a written offer to return the\nsecurity together with any income received by the purchaser on the security;\nand in e ither case he failed to accept the offer within thirty (30) days of its\nreceipt.\n(6) No person who has made or engaged in the performance of any contract in violation\nof any provision of this chapter or any rule or order hereunder, or who has acquired\nany purported right under any contract with knowledge of the facts by reason of\nwhich its making or performance was in violation, may base any suit on the\ncontract. Any condition, stipulation, or provision binding any person acquiring any\nsecurity to waive compliance with any provision of this chapter or any rule or order\nhereunder is void.\n(7) A person who receives directly or indirectly any consideration for providing\ninvestment advice to another person and who employs a device, scheme, or artifice\nto defraud the other person or engages in an act, practice, or course of business that\noperates or would operate as a fraud or deceit on the other person, is liable to the\nother person. The person defrauded may maintain an action to recover the\nconsideration paid fo r the advice and the amount of any actual damages caused by\nthe fraudulent conduct, interest at the legal rate of interest from the date of the\nfraudulent conduct, costs, and reasonable attorney's fees determined by the court,\nless the amount of any income received as a result of the fraudulent conduct.\n(8) The rights and remedies provided by this section are in addition to any other rights\nor remedies that may exist at law or in equity.","path":["KRS Chapter 292"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=15563","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:57:23Z","sha256":"2221af776e14413462f74c767a20cb332e652c159e3d42ad09c602518582148a","source_id":"us-ky","stale":false,"prev":"us-ky/krs-292.470","next":"us-ky/krs-292.490"},"notice":"GroundRules: Original legal text. Not legal advice."}