Douglass v. Stanger

A security has been defined liberally and broadly to include any note. In fact, there is a presumption that every note is a security. Reves v. Ernst & Young, 494 U.S. 56, 65, 110 S. Ct. 945, 108 L. Ed. 2d 47 (1990). In this *246case, Harlan Douglass gave Kenneth Stanger $23,000 in exchange for a promissory note and an “Investment Agreement” promising a 40 percent ownership interest in a shopping center property and development. Mr. Stanger then formed another corporation with Orville Barnes; and together they developed the shopping center — without Mr. Douglass. The first question presented is…