Blue sky (U.S. laws)
From Kook Science
In the United States of America, a blue sky law is, broadly, any state-level legal regulation on the offering and sale of securities (stocks and bonds) to the public, the provisions of such laws varying from state to state but generally enabling investors to pursue personal recompense when they are the victims of fraud (e.g. buying stock in corporations that don't perform any function outside of taking money from investors). "Blue sky" statutes were passed in most states in the Union from the late 1910s through the early 1930s; such activity was only addressed at the federal level as a matter of interstate commerce after the Wall Street Crash of 1929, beginning with the Securities Act of 1933 and the formation of the U.S. Securities and Exchange Commission.
"Blue Sky" Defendants
- Homer D. Brown, Oregon, 1927, over the sale of stock in his Brown-Estro Power and Manufacturing Co. to finance "the Power of God," a perpetual motion device that Brown claimed was "revealed to him by the Scripture";
- Peter Ivanoff, Washington, 1931, over the sale of stock in a company to finance his Co-Motional Motion-Power engine;
- Reed Bartlett, Wisconsin, 1939, over the sale of stock in a company to finance his compressed air perpetual motion machine.