The collapse of Sunwest Management has spawned a series of civil actions by aggrieved investors. The SEC is charging that the retirement home operator once worth $2 billion is actually a Ponzi scheme. And plaintiffs lawyers for Sunwest investors are suing three of the company’s outside law firms: Davis Wright Tremaine, K&L Gates and Thompson & Knight.
The suits all have been filed in state court in Oregon. Plaintiffs lawyers are quick to cite the state’s strict securities laws when confronted with the U.S. Supreme Court’s decision in Stoneridge Investment Partners v. Scientific-Atlanta , which limits the means by which third-party defendants can be held liable for their alleged roles in corporate frauds.
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