Coexist Foundation, Inc. v. Fehrenbacher

Dist. Ct. did not err in finding that defendant violated Florida statute prohibiting sale of unregistered security, arising out of transaction in which defendant told plaintiff that plaintiff would obtain 30 percent profit if it gave him $2 million that defendant would invest with third-party, where third-party used said funds in Ponzi scheme. Record supported finding that transaction qualified as sale of security, where emails between parties indicated that defendant would invest plaintiff’s funds with third party, and defendant was estopped from arguing otherwise, where defendant had asserted that such transaction was sale of unregistered security in his own successful lawsuit against third-party seeking return of defendant’s (and plaintiff’s) funds from third-party, and where defendant did not question in instant lawsuit authenticity of subject statement made in his prior lawsuit. Ct. also rejected defendant’s claim that instant transaction did not take place in Florida, where defendant asserted that transaction took place in Florida in his claim against third-party. Fact that defendant was also duped with respect to instant transaction by third-party did not preclude plaintiff from obtaining recovery from defendant, since defendant was acting as plaintiff’s agent in setting up transaction. Also, fact that plaintiff may have been dishonest in obtaining $2 million from others did not preclude plaintiff from obtaining recovery in instant lawsuit, since defendant was not victim of plaintiff’s alleged misconduct.