Davis v. Avco Financial Services, 739 F2d 1057 (1984)

Davis v. Avco Financial Services, 739 F2d 1057 (1984)

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he Court of Appeals held that a person is liable as a "seller" of a security if they were the proximate cause the securities sale. An Avco loan officer became involved with Dare to be Great, a program that was found to be a security. The loan officer made appearances at Dare meetings and encouraged those present to apply for a loan through Avco to pay for their participation in the program. The manager endorsed the Dare program as a good investment. It was Avco's negligent supervision of its employees actions, endorsing the Dare scheme and encouraging membership, that gave rise to the company's liability as a "seller" of securities.

Full case is also available at: http://www.mlmlegal.com/legal-cases/Davis_v_AvcoFinancialServices.php

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Reference Info:Federal, 6th Circuit, Ohio | United States

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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