B. Edmond Waters, Arkansas Securities Commissioner, Appellant v. Isaac Hal Millsap Iii, Gifford Keith Jordon, And…

Summary

The court held that whether the loan agreements were securities must be determined under Arkansas's flexible, all-facts approach, rather than by applying the five-factor test exclusively. Because the circuit court relied only on that five-factor test and did not consider all relevant transaction circumstances, including the parties' sophistication, the court reversed and remanded for reconsideration. Justice Danielson, joined by the Chief Justice and Justice Hart, dissented and would have affirmed the ruling that the transactions were ordinary loans rather than securities.