2017 ORS 59.137¹
Liability in connection with violation of ORS 59.135
  • damages
  • defense
  • attorney fees
  • limitations on proceeding

(1) Any person who violates or materially aids in a violation of ORS 59.135 (Fraud and deceit with respect to securities or securities business) (1), (2) or (3) is liable to any purchaser or seller of the security for the actual damages caused by the violation, including the amount of any commission, fee or other remuneration paid, together with interest at the rate specified in ORS 82.010 (Legal rate of interest) for judgments for the payment of money, unless the person who materially aids in the violation sustains the burden of proof that the person did not know and, in the exercise of reasonable care, could not have known of the existence of the facts on which the liability is based.

(2) Any person who directly or indirectly controls a person liable under subsection (1) of this section and every partner, limited liability company manager, including a member who is a manager, officer or director or a person occupying a status or performing functions of a person liable under subsection (1) of this section, is jointly and severally liable to the same extent as a person liable under subsection (1) of this section, unless the person who may be liable under this subsection sustains the burden of proof that the person did not know and, in the exercise of reasonable care, could not have known of the existence of the facts on which the liability is based.

(3) Any person held liable under this section is entitled to contribution from those persons jointly and severally liable with that person.

(4) Except as provided in subsection (5) of this section, the court may award reasonable attorney fees to the prevailing party in an action under this section.

(5) The court may not award attorney fees to a prevailing defendant under the provisions of subsection (4) of this section if the action under this section is maintained as a class action pursuant to ORCP 32.

(6) An action or suit may be commenced under this section within the later of:

(a) Three years after the date of the purchase or sale of a security to which the action or suit relates; or

(b) Two years after the person bringing the action or suit discovered or should have discovered the facts on which the action or suit is based.

(7) Failure to commence an action or suit under this section on a timely basis is an affirmative defense. [2003 c.631 §4; 2003 c.786 §3]

Notes of Decisions

Where stock purchaser is re­quired to es­tab­lish reliance ele­ment under this sec­tion, plaintiff who purchases stock on efficient, open market may es­tab­lish reliance ele­ment by means of rebuttable presump­tion available under fraud-on-market-doctrine which is incorporated in this sec­tion. State v. Marsh & McLennan Companies, Inc., 353 Or 1, 292 P3d 525 (2012)

Because viola­tions of ORS 59.135 (Fraud and deceit with respect to securities or securities business) subsec­tions (1), (2) or (3) refer to acts that are committed with “scienter,” plaintiff that brings ac­tion under this sec­tion, must prove that defendants acted with guilty state of mind when defendants made misrepresenta­tions on which plaintiff relied. State v. Marsh & McLennan Companies, Inc., 353 Or 1, 292 P3d 525 (2012)

Law Review Cita­tions

56 OLR 473 (1977); 68 OLR 228 (1989)

Chapter 59

Notes of Decisions

Public policy does not prohibit nonculpable corporate directors held liable under this chapter from seeking indemnifica­tion from per­sons actually responsible for the wrongful issuance of unregistered securities. Collins v. Fitzwa­ter, 277 Or 401, 560 P2d 1074 (1977)

Atty. Gen. Opinions

Addi­tional real estate license not re­quired where security sold is interest in limited partnership to invest in real estate, (1978) Vol 38, p 1971

1 Legislative Counsel Committee, CHAPTER 59—Securities Regulation, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ors059.­html (2017) (last ac­cessed Mar. 30, 2018).
 
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2017, Chapter 59, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano059.­html (2017) (last ac­cessed Mar. 30, 2018).
 
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent.