Ky. Rev. Stat. » Chapter 292
Kentucky Revised Statutes

Ky. Rev. Stat. § 292.480 (2026)

Civil liabilities

✓ current as of May 2026
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(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 omission 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 untruth 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 provisions 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 together 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 difference 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 at 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 either 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 for 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. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 82, sec. 12, effective July 15, 2010. -- Amended 2001 Ky. Acts ch. 129, sec. 1, effective June 21, 2001. -- Amended 1998 Ky. Acts ch. 20, sec. 20, effective July 15, 1998. -- Amended 1972 Ky. Acts ch. 265, sec. 14, effective June 16, 1972. -- Created 1960 Ky. Acts ch. 110, sec. 18, effective January 1, 1961. Legislative Research Commission Note (6/21/2001). Section 2 of 2001 Ky. Acts ch. 129 provides that "the amendments [to KRS 292.480] contained in Section 1 of this Act shall be retroactively applied to any actions, other than those actions given res judicata effect by a court of competent jurisdiction, which in the exercise of reasonable care would have been discovered as having accrued in the ten (10) years immediately preceding the effective date of this Act [June 21, 2001]."

Notes of Decisions
Cited in 29 cases (1 in the last 5 years), 1973–2022 · leading case: Clayton v. Heartland Resources, Inc., 754 F. Supp. 2d 884 (W.D. Ky. 2010).
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Clayton v. Heartland Resources, Inc., 754 F. Supp. 2d 884 (W.D. Ky. 2010). · cites it 40× “320] can only be invoked as the basis of a private cause of action under KRS 292.480....”). 11 . 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 together with…”
Sierra Enter. Inc. v. SWO & ISM, LLC, 264 F. Supp. 3d 826 (W.D. Ky. 2017). · cites it 15× “the actions Lewis Oil took when it “aided and abett[ed] in and acted in concert or pursuant to a common design to engage in the actions” described in other counts of the Amended Complaint, including Counts VIX (breach of fiduciary duties); Counts XI-XV (common law fraud); Counts…”
Booth v. Verity, Inc., 124 F. Supp. 2d 452 (W.D. Ky. 2000). · cites it 22× “KRS 292.480 parallels Section 12(2) of the Securities Act of 1933 (“Section 12”).”
Excel Energy, Inc. v. Smith (In Re Commonwealth Institutional Sec., Inc.), 286 B.R. 851 (W.D. Ky. 2002). · cites it 25× “Therefore, because the state court determined that Commonwealth was not a “seller” of securities under Ky.Rev.Stat. Ann. § 292.480, the Bankruptcy Court is bound by that finding, and collateral estoppel bars it from relitigating the issue.”
Plaut v. Spendthrift Farm, Inc., 514 U.S. 211 (1995). · cites it 2× “, at 374. Justice Souter and I would have adhered to "four decades of .”
Repub. Bank & Trust Co. v. Bear, Stearns & Co., 707 F. Supp. 2d 702 (W.D. Ky. 2010). · cites it 4× “320, such that it might be able to recover under KRS 292.480. This statute is “virtually identical” to the federal securities fraud laws, and requires proof of six elements: (1) misrepresentation or omission of a material fact; (2) scienter; (3) a connection with the purchase or…”
Herm v. Stafford, 455 F. Supp. 650 (W.D. Ky. 1978). · cites it 11× “The Sixth Circuit Court of Appeals has not yet ruled whether application of the former statutory period (three years as amended June 16, 1972) or the fraud period (five years) better effectuates federal securities policies. The Court must also decide when the applicable statute…”
Obasi Inv. Ltd v. Tibet Pharm. Inc, 931 F.3d 179 (3rd Cir. 2019). · cites it 2× “at 736 (quoting Ky. Rev. Stat. § 292.480). The plaintiffs there argued the company’s “officers and directors 24 ‘relied completely’ on [the defendant’s] work and would have ‘structured their sales operation in any way [the defendant] advised.”
Hutto v. Bockweg, 579 S.W.2d 382 (Ky. Ct. App. 1979). · cites it 8× “The answer of Bockweg and Selective Securities raised the 3-year statute of limitations of KRS 292.480 as a bar to the action. The Huttos subsequently filed an amended complaint challenging the constitutionality of KRS 292.”
Boling v. Prospect Funding Holdings, LLC, 324 F. Supp. 3d 887 (W.D. Ky. 2018). · cites it 3× “330(1) 3 and granted summary judgment in favor of the defendant pursuant to KRS 292.480(6), which provides: 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…”
City of Owensboro v. First U. S. Corp., 534 S.W.2d 789 (Ky. Ct. App. 1975). · cites it 5× “*791 The civil remedies section of the Blue Sky Law, KRS 292.480(1), by its terms, applies to any person who “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…”
Cali-Ken Petroleum Co., Inc. v. Miller, 815 F. Supp. 216 (W.D. Ky. 1993). · cites it 6× “” KRS 292.480(3). Plaintiff filed its Complaint on September 25, 1987.”
Show all 29 citing cases →
— Ky. Rev. Stat. § 292.480(1) — 10 cases
Clayton v. Heartland Resources, Inc., 754 F. Supp. 2d 884 (W.D. Ky. 2010). “320] can only be invoked as the basis of a private cause of action under KRS 292.480....”). 11 . 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 together with…”
Sierra Enter. Inc. v. SWO & ISM, LLC, 264 F. Supp. 3d 826 (W.D. Ky. 2017). “the actions Lewis Oil took when it “aided and abett[ed] in and acted in concert or pursuant to a common design to engage in the actions” described in other counts of the Amended Complaint, including Counts VIX (breach of fiduciary duties); Counts XI-XV (common law fraud); Counts…”
Repub. Bank & Trust Co. v. Bear, Stearns & Co., 707 F. Supp. 2d 702 (W.D. Ky. 2010). “320, such that it might be able to recover under KRS 292.480. This statute is “virtually identical” to the federal securities fraud laws, and requires proof of six elements: (1) misrepresentation or omission of a material fact; (2) scienter; (3) a connection with the purchase or…”
City of Owensboro v. First U. S. Corp., 534 S.W.2d 789 (Ky. Ct. App. 1975). “*791 The civil remedies section of the Blue Sky Law, KRS 292.480(1), by its terms, applies to any person who “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…”
Wilson v. Southward Inv. Co. 1, 675 S.W.2d 10 (Ky. Ct. App. 1984).
— Ky. Rev. Stat. § 292.480(2) — 5 cases
Excel Energy, Inc. v. Smith (In Re Commonwealth Institutional Sec., Inc.), 286 B.R. 851 (W.D. Ky. 2002). “Therefore, because the state court determined that Commonwealth was not a “seller” of securities under Ky.Rev.Stat. Ann. § 292.480, the Bankruptcy Court is bound by that finding, and collateral estoppel bars it from relitigating the issue.”
Fed. Sec. L. Rep. P 93,959 Frank Lanza, Jr. v. Drexel & Co., Theodore J. Kircher & Christie F. Vitolo, 479 F.2d 1277 (2d Cir. 1973).
Herm v. Stafford, 466 F. Supp. 439 (W.D. Ky. 1979).
Smith v. Manausa, 385 F. Supp. 443 (E.D. Ky. 1974).
Excel Energy Inc v. Smith (6th Cir. 2005).
— Ky. Rev. Stat. § 292.480(3) — 11 cases
Cali-Ken Petroleum Co., Inc. v. Miller, 815 F. Supp. 216 (W.D. Ky. 1993). “” KRS 292.480(3). Plaintiff filed its Complaint on September 25, 1987.”
Hutto v. Bockweg, 579 S.W.2d 382 (Ky. Ct. App. 1979). “The answer of Bockweg and Selective Securities raised the 3-year statute of limitations of KRS 292.480 as a bar to the action. The Huttos subsequently filed an amended complaint challenging the constitutionality of KRS 292.”
City of Owensboro v. First U. S. Corp., 534 S.W.2d 789 (Ky. Ct. App. 1975). “*791 The civil remedies section of the Blue Sky Law, KRS 292.480(1), by its terms, applies to any person who “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…”
Adrian Freeman v. Laventhol & Horwath, Bank of the South, N.A., 34 F.3d 333 (6th Cir. 1994).
Payne v. Fid. Homes of Am., Inc., 437 F. Supp. 656 (W.D. Ky. 1977).
— Ky. Rev. Stat. § 292.480(4) — 5 cases
Clayton v. Heartland Resources, Inc., 754 F. Supp. 2d 884 (W.D. Ky. 2010). “320] can only be invoked as the basis of a private cause of action under KRS 292.480....”). 11 . 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 together with…”
Sierra Enter. Inc. v. SWO & ISM, LLC, 264 F. Supp. 3d 826 (W.D. Ky. 2017). “the actions Lewis Oil took when it “aided and abett[ed] in and acted in concert or pursuant to a common design to engage in the actions” described in other counts of the Amended Complaint, including Counts VIX (breach of fiduciary duties); Counts XI-XV (common law fraud); Counts…”
Excel Energy, Inc. v. Smith (In Re Commonwealth Institutional Sec., Inc.), 286 B.R. 851 (W.D. Ky. 2002). “Therefore, because the state court determined that Commonwealth was not a “seller” of securities under Ky.Rev.Stat. Ann. § 292.480, the Bankruptcy Court is bound by that finding, and collateral estoppel bars it from relitigating the issue.”
McNally v. The Kingdom Trust Co. (W.D. Ky. 2022).
Cory v. Leasure, 491 B.R. 476 (Bankr. W.D. Ky. 2013).
— Ky. Rev. Stat. § 292.480(5) — 1 case
Repub. Bank & Trust Co. v. Bear, Stearns & Co., 707 F. Supp. 2d 702 (W.D. Ky. 2010). “320, such that it might be able to recover under KRS 292.480. This statute is “virtually identical” to the federal securities fraud laws, and requires proof of six elements: (1) misrepresentation or omission of a material fact; (2) scienter; (3) a connection with the purchase or…”
— Ky. Rev. Stat. § 292.480(5)(a) — 1 case
Clayton v. Heartland Resources, Inc., 754 F. Supp. 2d 884 (W.D. Ky. 2010). “320] can only be invoked as the basis of a private cause of action under KRS 292.480....”). 11 . 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 together with…”
— Ky. Rev. Stat. § 292.480(6) — 1 case
Boling v. Prospect Funding Holdings, LLC, 324 F. Supp. 3d 887 (W.D. Ky. 2018). “330(1) 3 and granted summary judgment in favor of the defendant pursuant to KRS 292.480(6), which provides: 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…”
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