Title 37, TRADE REGULATION

The following business opportunities are exempt from §§ 37-25A-7 to 37-25A-24 , inclusive: (1) Any offer or sale of a business opportunity for which the immediate cash payment made by the purchaser for any business opportunity is at least twenty-five thousand dollars if the immed…

If it appears to the director of the Division of Insurance that any person has engaged in or is about to engage in any act or practice constituting a violation of any provision of this chapter, the director may: (1) Issue an order directing the person to cease and desist from con…

Any person aggrieved by a final order of the director of the Division of Insurance may obtain a review of the order in the circuit court pursuant to the provisions of chapter 1-26 . Source: SL 1985, ch 305 , § 31; SL 2017, ch 231 (Ex. Ord. 17-2 ), § 19, eff. Apr. 13, 2017.

The director of the Division of Insurance may promulgate rules pursuant to chapter 1-26 to carry out the provisions of this chapter including rules and forms governing disclosure documents, applications and reports, and defining any terms. For the purpose of rules and forms, the …

No rule, form, or order may be made, amended, or rescinded unless the director of the Division of Insurance finds that the action is necessary or appropriate in the public interest or for the protection of the purchaser. In prescribing rules and forms the director may cooperate w…

No provision of this chapter imposing any liability applies to any act done or omitted in good faith in conformity with any rule, form, or order of the director of the Division of Insurance, notwithstanding that the rule, form, or order may later be amended or rescinded or may be…

A document is filed when it is received by the director of the Division of Insurance. The director shall keep a register of all applications for registration and disclosure documents which are or have been effective under this chapter and all orders which have been entered under …

The director of the Division of Insurance may honor written requests from interested persons for interpretative opinions upon the payment of twenty-five dollars. Source: SL 1985, ch 305 , § 36; SL 2017, ch 231 (Ex. Ord. 17-2 ), § 19, eff. Apr. 13, 2017.

The provisions of this chapter concerning sales and offers to sell apply to persons who sell or offer to sell if: (1) An offer to sell is made in this state; (2) An offer to purchase is made and accepted in this state; or (3) The purchaser is domiciled in this state and the busin…

For the purpose of this chapter, an offer to sell is made in this state, whether either party is then present in this state, if: (1) The offer originates from this state; or (2) The offer is directed by the offeror to this state and received at the place to which it is directed o…

For the purpose of this chapter, an offer to sell is accepted in this state if acceptance: (1) Is communicated to the offeror in this state; and (2) Has not previously been communicated to the offeror, orally or in writing, outside this state; and acceptance is communicated to th…

The director of the Division of Insurance may by order deny or revoke any exemption specified in § 37-25A-3 , except the exemption provided in subdivision 37-25A-3(2), with respect to a particular offering of one or more business opportunities. No such order may be entered withou…

An offer to sell is not made in this state if: (1) The publisher circulates in this state any bona fide newspaper or other publication of general, regular and paid circulation which is not published in this state, or which is published in this state but has had more than two - th…

If any person engages in conduct prohibited or made actionable by this chapter or any rule or order hereunder, and the person has not filed a consent to service of process and personal jurisdiction over the person cannot otherwise be obtained in this state, that conduct is equiva…

If process is served under this chapter, the court, or the director of the Division of Insurance in a proceeding before the director, shall order such continuance as necessary to afford the defendant or respondent reasonable opportunity to defend himself. Source: SL 1985, ch 305 …

No person, in connection with the offer or sale of any business opportunity in this state, may: (1) Employ any device, scheme, or artifice to defraud; (2) Make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements ma…

No person may make or cause to be made, in any document filed with the director of the Division of Insurance or in any proceeding under this chapter, any statement which is, at the time and in the light of the circumstances under which it is made, false or misleading in any mater…

Neither the fact that an application for registration has been filed nor the fact that a business opportunity is effectively registered constitutes a finding by the director of the Division of Insurance that any document filed under this chapter is true, complete and not misleadi…

No person may, in connection with the offer or sale of any business opportunity in this state, publish, circulate, or use any advertising which contains an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements made, in the…

Any person who willfully violates §§ 37-25A-7 to 37-25A-9 , inclusive, 37-25A-14 , 37-25A-16 , 37-25A-23 , 37-25A-24 , 37-25A-43 , 37-25A-45 , and 37-25A-46 or who willfully violates any order of which the person has notice, or who violates § 37-25A-44 knowing that the statement …

Any person who violates §§ 37-25A-7 to 37-25A-9 , inclusive, 37-25A-14 , 37-25A-16 , 37-25A-23 , and 37-25A-24 is liable to the purchaser who may sue either at law or in equity for rescission, for recovery of all money or other valuable consideration paid for the business opportu…

Any person who violates §§ 37-25A-43 , 37-25A-45 , and 37-25A-46 is liable to the purchaser who may sue either at law or in equity for rescission, for recovery of all money or other valuable consideration paid for the business opportunity and for actual damages, together with int…

If the public interest or the protection of purchasers so requires, the director of the Division of Insurance may by order deny or revoke without a hearing any of the specified exemptions, except the exemption provided in subdivision 37-25A-3(2), pending final determination of an…

Any person who violates §§ 37-25A-14 , 37-25A-43 , 37-25A-45 , and 37-25A-46 , or who breaches any business opportunity contract or agreement or any obligation arising under the contract or agreement, is liable to the purchaser who may sue the surety of the bond, either at law or…

Any person who controls or materially aids a person liable under § 37-25A-46 or 37-25A-47 shall be liable jointly and severally with and to the same extent as the person committing the violation. Source: SL 1985, ch 305 , § 51.

No action may be maintained under §§ 37-25A-47 to 37-25A-49 , inclusive, unless commenced before the expiration of three years after the act of transaction constituting the violation. Source: SL 1985, ch 305 , § 52.

The rights and remedies under this chapter are in addition to any other rights or remedies that may exist at law or in equity. Source: SL 1985, ch 305 , § 53.

Any condition, stipulation or provision binding any purchaser of a business opportunity to waive compliance with or relieving a person from any duty or liability imposed by or any right provided by this chapter or any rule or order issued pursuant to this chapter is void. Source:…

The director may impose a civil penalty against a person named in an order issued under § 37-25A-30 for violation of §§ 37-25A-7 , and 37-25A-43 to 37-25A-46 , inclusive. The amount of the civil penalty may not exceed five thousand dollars for each act or omission that constitute…

No person is considered to have violated § 37-25A-7 by reason of any offer or sale effected after the entry of an order under § 37-25A-5 if he establishes that he did not know and, in the exercise of reasonable care, could not have known, of the order. Source: SL 1985, ch 305 , §…

No person may offer or sell any business opportunity in this state unless the business opportunity is registered under this chapter or is exempt under § 37-25A-3 . Source: SL 1985, ch 305 , § 7.

In order to register a business opportunity, the seller shall file with the director of the Division of Insurance one of the following disclosure documents with the appropriate cover sheet as required by § 37-25A-15 , a consent to service of process as specified in § 37-25A-9 and…

Every seller shall file, in a form the director of the Division of Insurance prescribes, an irrevocable consent appointing the director or the successor in office to be the seller's agent to receive service of any lawful process in any noncriminal suit, action or proceeding again…

Terms used throughout this chapter unless the context plainly requires otherwise shall mean: (1) "Buying club," any corporation, partnership, unincorporated association, or other business enterprise organized with the primary purpose of providing benefits to members from the coop…

In addition to the remedies otherwise provided by law, any person damaged by a violation of any of the provisions of this chapter may bring a civil action and recover damages, together with costs and disbursements, including reasonable attorney's fees, and receive other equitable…

The attorney general shall investigate violations of this chapter. If, from information in his possession there are reasonable grounds to believe that any person has violated or is about to violate any provisions of this chapter, or that any club is insolvent, the attorney genera…

Any person who employs, directly or indirectly, any device, scheme, or artifice to defraud in connection with the offer or sale of any membership or engages, directly or indirectly, in any act, practice, or course of business which operates or would operate as a fraud or deceit u…

Every buying club shall maintain a cash bond or a bond issued by a surety company licensed to do business in this state in the penal sum of one hundred thousand dollars. Source: SL 1975, ch 246 , § 6.

The bond required by § 37-26-3 shall be in favor of the state for the benefit of any member who suffers loss of any prepayment made pursuant to a contract entered into after March 27, 1975, due to insolvency of the club or the cessation of business by the club. The bond shall be …

The aggregate liability of the surety to all persons for all breaches of the conditions of the bonds provided herein shall in no event exceed the amount of the bond. Source: SL 1975, ch 246 , § 9.

Sections 37-26-3 to 37-26-5 , inclusive, do not apply to any club which files a declaration, executed under penalty of perjury by the owner or manager of such club, with the attorney general stating that the club does not require, or in the ordinary course of business, receive pr…

Any person who intentionally violates any provisions of this chapter which is not otherwise classified is guilty of a Class 5 felony. Source: SL 1975, ch 246 , § 13; SL 1977, ch 190 , § 298.

Nothing in this chapter shall limit the power of this state to punish any person for any conduct which constitutes a crime under any other statute. Source: SL 1975, ch 246 , § 15.

Notwithstanding any other provision of law, the avoidance period provisions as provided for in chapter 37-24 are applicable to contracts for membership under this chapter. Source: SL 1975, ch 246 , § 2.

Terms used in this chapter, unless the context otherwise plainly requires, mean: (1) "Act of Congress," the Act of Congress approved June 18, 1934, entitled an act to provide for the establishment, operation and maintenance of foreign trade zones in ports of entry of the United S…

Any public or private corporation may apply to the proper authorities of the United States for a grant of privilege authorizing the establishment, operation and maintenance of foreign trade zones and foreign trade subzones, and the establishment, operation and maintenance of such…