Department of Corporations v. Superior Court

Opinion

IRION, J.

The instant petition for a writ of mandate presents the question of whether the California Department of Corporations (the DOC) may be held liable for investment losses suffered by investors who purchased fraudulent securities from brokers subject to “desist and refrain orders” after those orders were rescinded by the DOC. The real parties in interest contend that under Government Code section 815.6, which creates a private right of action against public entities that fail to discharge a “mandatory duty,” the DOC may be held liable for such losses because the DOC violated…