(a) Enforcement of civil liability under this section is subject to P.L. 105-353 (Securities Litigation Uniform Standards Act of 1998).
Terms Used In Alaska Statutes 45.56.710
action: includes any matter or proceeding in a court, civil or criminal. See Alaska Statutes 01.10.060
agent: means an individual, other than a broker-dealer, who represents a broker-dealer in effecting or attempting to effect purchases or sales of securities or represents an issuer in effecting or attempting to effect purchases or sales of the issuer's securities. See Alaska Statutes 45.56.900
broker-dealer: means a person engaged in the business of effecting transactions in securities for the accounts of others or for the person's own account. See Alaska Statutes 45.56.900
Contract: A legal written agreement that becomes binding when signed.
Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
Discovery: Lawyers' examination, before trial, of facts and documents in possession of the opponents to help the lawyers prepare for trial.
Fraud: Intentional deception resulting in injury to another.
investment adviser: includes a financial planner or other person that, as an integral component of other financially related services, provides investment advice to others for compensation as part of a business or that holds itself out as providing investment advice to others for compensation. See Alaska Statutes 45.56.900
investment adviser representative: means an individual employed by or associated with an investment adviser or federal covered investment adviser and who makes any recommendations or otherwise gives investment advice regarding securities, manages accounts or portfolios of clients, determines which recommendation or advice regarding securities should be given, provides investment advice or offers to provide investment advice, receives compensation to solicit, offer, or negotiate for the sale of or for selling investment advice, or supervises employees who perform any of the foregoing. See Alaska Statutes 45.56.900
Litigation: A case, controversy, or lawsuit. Participants (plaintiffs and defendants) in lawsuits are called litigants.
person: means an individual, a corporation, a partnership, a limited liability company, a limited partnership, a limited liability partnership, an association, a joint-stock company, a trust in which the interests of the beneficiaries are evidenced by a security, an unincorporated organization, a government, or a political subdivision of a government. See Alaska Statutes 45.56.900
Plaintiff: The person who files the complaint in a civil lawsuit.
sale: includes every contract of sale, contract to sell, or disposition of a security or interest in a security for value, and "offer to sell" includes every attempt or offer to dispose of, or solicitation of an offer to purchase, a security or interest in a security for value. See Alaska Statutes 45.56.900
state: means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States. See Alaska Statutes 45.56.900
(b) A person is liable to the purchaser if the person sells a security in violation of Alaska Stat. § 45.56.100, or by means of an untrue statement of a material fact or an omission to state a material fact necessary to make the statement made, in light of the circumstances under which it is made, not misleading, the purchaser not knowing the untruth or omission and the seller not sustaining the burden of proof that the seller did not know and, in the exercise of reasonable care, could not have known of the untruth or omission. An action under this subsection is governed by the following:
(1) the purchaser may maintain an action to recover the consideration paid for the security, less the amount of any income received on the security, and interest at the legal rate of interest under Alaska Stat. § 09.30.070, or eight percent a year, whichever is greater, from the date of the purchase, costs, and attorney fees as determined by the court, upon the tender of the security, or for actual damages as provided in (3) of this subsection;(2) the tender referred to in (1) of this subsection may be made any time before entry of judgment; tender requires only notice in a record of ownership of the security and willingness to exchange the security for the amount specified; a purchaser that no longer owns the security may recover actual damages as provided in (3) of this subsection;(3) actual damages in an action arising under this subsection are the amount that would be recoverable upon a tender less the value of the security when the purchaser disposed of it, and interest at the legal rate of interest under Alaska Stat. § 09.30.070, or eight percent a year, whichever is greater, from the date of the purchase, costs, and attorney fees as determined by the court.(c) A person is liable to the seller if the person buys a security by means of an untrue statement of a material fact or omission to state a material fact necessary to make the statement made, in light of the circumstances under which it is made, not misleading, the seller not knowing of the untruth or omission, and the purchaser not sustaining the burden of proof that the purchaser did not know and, in the exercise of reasonable care, could not have known of the untruth or omission. An action under this subsection is governed by the following:
(1) the seller may maintain an action to recover the security and any income received on the security, costs, and attorney fees as determined by the court, upon the tender of the purchase price, or for actual damages as provided in (3) of this subsection;(2) the tender referred to in (1) of this subsection may be made any time before entry of judgment; tender requires only notice in a record of the present ability to pay the amount tendered and willingness to take delivery of the security for the amount specified; if the purchaser no longer owns the security, the seller may recover actual damages as provided in (3) of this subsection;(3) actual damages in an action arising under this subsection are the difference between the price at which the security was sold and the value the security would have had at the time of the sale in the absence of the purchaser’s conduct causing liability, and interest at the legal rate of interest under Alaska Stat. § 09.30.070, or eight percent a year, whichever is greater, from the date of the sale of the security, costs, and attorney fees as determined by the court.(d) A person acting as a broker-dealer or agent that sells or buys a security in violation of Alaska Stat. § 45.56.300(a), 45.56.340(a), or 45.56.530 is liable to the customer. The customer, if a purchaser, may maintain an action for recovery of actual damages as specified in (b) of this section or, if a seller, for a remedy as specified in (c) of this section.(e) A person acting as an investment adviser or investment adviser representative that provides investment advice for compensation in violation of Alaska Stat. § 45.56.340(a), 45.56.350(a), or 45.56.530 is liable to the client. The client may maintain an action to recover the consideration paid for the advice, interest at the legal rate of interest under Alaska Stat. § 09.30.070, or eight percent a year, whichever is greater, from the date of payment, costs, and attorney fees as determined by the court. (f) A person that receives, directly or indirectly, any consideration for providing investment advice to another person and that 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. An action under this subsection is governed by the following:
(1) the person defrauded may maintain an action to recover the consideration paid for the advice and the amount of any actual damages caused by the fraudulent conduct, interest at the legal rate of interest under Alaska Stat. § 09.30.070, or eight percent a year, whichever is greater, from the date of the fraudulent conduct, costs, and reasonable attorney fees as determined by the court, less the amount of any income received as a result of the fraudulent conduct;(2) this subsection does not apply to a broker-dealer or its agents if the investment advice provided is solely incidental to transacting business as a broker-dealer and special compensation is not received for the investment advice.(g) The following persons are liable jointly and severally with and to the same extent as persons liable under (b) – (f) of this section:
(1) a person that directly or indirectly controls a person liable under (b) – (f) of this section, unless the controlling person 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 conduct because of which the liability is alleged to exist;(2) an individual who is a managing partner, executive officer, or director of a person liable under (b) – (f) of this section, including an individual having a similar status or performing similar functions, unless the individual sustains the burden of proof that the individual did not know and, in the exercise of reasonable care, could not have known of the existence of conduct because of which the liability is alleged to exist;(3) an individual who is an employee of or associated with a person liable under (b) – (f) of this section and who materially aids the conduct giving rise to the liability, unless the individual sustains the burden of proof that the individual did not know and, in the exercise of reasonable care, could not have known of the existence of conduct because of which the liability is alleged to exist; and(4) a person that is a broker-dealer, agent, investment adviser, or investment adviser representative that materially aids the conduct giving rise to the liability under (b) – (f) of this section, unless the person 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 conduct because of which the liability is alleged to exist.(h) A person liable under this section has a right of contribution as in cases of contract against any other person liable under this section for the same conduct.(i) A cause of action under this section survives the death of an individual who might have been a plaintiff or defendant.(j) A person may not obtain relief under (b) of this section
(1) for a violation of Alaska Stat. § 45.56.100, or under (d) or (e) of this section, unless the action is instituted within three years after the violation occurred; or(2) other than for a violation of Alaska Stat. § 45.56.100, or under (c) or (f) of this section, unless the action is instituted within the earlier of two years after discovery of the facts constituting the violation or five years after the violation.(k) A person that has made, or has engaged in the performance of, a contract in violation of this chapter or a regulation adopted or order issued under this chapter or that has acquired a purported right under the contract with knowledge of conduct because of which its making or performance was in violation of this chapter may not base an action on the contract.(l) A condition, stipulation, or provision binding a person purchasing or selling a security or receiving investment advice to waive compliance with this chapter or a regulation adopted or order issued under this chapter is void.(m) The rights and remedies provided by this chapter are in addition to any other rights or remedies that may exist, but this chapter does not create a cause of action not specified in this section or Alaska Stat. § 45.56.420(e).
