Bitounis v. Interactive Brokers, L.L.C.

[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as

Bitounis v. Interactive Brokers, L.L.C., Slip Opinion No. 2026-Ohio-2268.]

NOTICE

This slip opinion is subject to formal revision before it is published in an

advance sheet of the Ohio Official Reports. Readers are requested to

promptly notify the Reporter of Decisions, Supreme Court of Ohio, 65

South Front Street, Columbus, Ohio 43215, of any typographical or other

formal errors in the opinion, in order that corrections may be made before

the opinion is published.

SLIP OPINION NO. 2026-OHIO-2268

BITOUNIS ET AL., APPELLEES, v. INTERACTIVE BROKERS, L.L.C., APPELLANT,

ET AL.

[Until this opinion appears in the Ohio Official Reports advance sheets, it

may be cited as Bitounis v. Interactive Brokers, L.L.C., Slip Opinion No.

2026-Ohio-2268.]

Civil law—R.C. 1707.43(A)—Brokerage firm that performed only routine business

activities for its customer after that customer unlawfully sold securities did

not participate or aid in the unlawful sales and therefore cannot be held

liable for those sales under R.C. 1707.43(A)—Court of appeals’ judgment

reversed and trial court’s judgment reinstated.

No. 2024-1290—Submitted September 16, 2025—Decided June 18, 2026.

APPEAL from the Court of Appeals for Cuyahoga County,

No. 113193, 2024-Ohio-2905.

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SUPREME COURT OF OHIO

SHANAHAN, J., authored the opinion of the court, which KENNEDY, C.J., and

FISCHER, DEWINE, DETERS, and HAWKINS, JJ., joined. BRUNNER, J., dissented,

with an opinion.

SHANAHAN, J.

{¶ 1} In this appeal, we are asked to decide whether a brokerage firm that

provides routine account services for a customer’s investment fund as part of its

normal business activities may be held liable under R.C. 1707.43(A) for the

customer’s prior unlawful sale of securities.

{¶ 2} We conclude that R.C. 1707.43(A) does not extend liability to

brokerage firms whose routine business activities were performed after the

unlawful sale of securities was complete. Because the allegations raised in the

amended complaint filed by appellees, 21 investors who contend they lost money

through the purchase of unlawful securities (collectively, “the investors”),1 describe

primarily routine postsale brokerage services performed by appellant, Interactive

Brokers, L.L.C. (“IB”)2—e.g., account setup, compliance checks, and trade

execution—we conclude that IB did not participate or aid in the unlawful sales and

therefore cannot be held liable for those sales under R.C. 1707.43(A). The

amended complaint also includes allegations that before the account was opened,

IB reviewed certain materials, including a Private Placement Memorandum

(“PPM”) naming IB as the fund’s broker, before agreeing to open the brokerage

account. But, as explained in the analysis below, those allegations do not describe

1. The 21 investors who filed suit are Constantine Bitounis; Goudas Enterprises, Ltd.; Gus Pyros;

Sophocles Sophocleus; George Voutsiotis; Vivy Voutsiotis; Karvo Companies, Inc., d.b.a. Karvo

Paving Company; G & Y Group, L.L.C.; Corrosion Resistance, Ltd.; GAADY, L.L.C.; George

Karvounides; Anna Karvounides; Yianni Karvounides; Dina Karvounides; Evangelos Varvaras;

Angela Varvaras; Haralambos Gonos; Timothy Moff; Auctus Properties, L.L.C.; Alexandra

Voutsiotis; and Susan George.

2. Two defendants were named in the amended complaint: Interactive Brokers, L.L.C., and

“Interactive Brokers (a fictitious name).”

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January Term, 2026

conduct tied to the solicitation, negotiation, or execution of any specific sale of

securities to the investors. We therefore reverse the judgment of the Eighth District

Court of Appeals and reinstate the trial court’s dismissal of the amended complaint.

I. BACKGROUND

{¶ 3} Between 2015 and 2021, Constantine Antonas operated the Epitome

Investment Fund, L.P. (“Epitome”), a private-investment hedge fund that he alone

created and managed. The investors alleged in an initial complaint, subsequently

followed by an amended complaint, that Antonas had solicited investors, promising

“high risk-adjusted returns” with limited downside risk. In total, Antonas collected

roughly $25 million in investor funds.

{¶ 4} Antonas was not registered as an investment adviser with the SEC and

did not qualify for an exemption from registration. Antonas drafted a PPM

identifying IB as the fund’s “Broker,” which, according to the investors, lent

legitimacy to Antonas’s scheme.

{¶ 5} IB operates as a global online-brokerage platform. Its function is to

clear trades for its customers (i.e., account holders) who own or control the assets

being traded. Before opening an account for a customer, IB complies with federally

mandated “Know Your Customer” anti-money-laundering procedures under

31 C.F.R. 1023.220 and Financial Industry Regulatory Authority Rule 2090, which

require identity verification and documentation. Ultimately, IB opened a trading

account for Epitome, allowing Antonas to deposit the funds invested in Epitome

and execute trades.

{¶ 6} Antonas lost nearly all the invested capital in Epitome through

speculative trades. He died in 2021, leaving the investors without recourse against

him. So the investors sued IB, alleging that IB had participated in or aided Antonas

in selling unregistered securities and seeking recovery of their invested funds under

R.C. 1707.43(A).

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{¶ 7} The investors alleged that IB had reviewed and approved the PPM

despite several purported “red flags,” including that Antonas had listed his home

address as the principal place of business for Epitome, had not listed the name of

the fund’s auditor or administrator, and had identified himself—a 20-year-old who

was not licensed to be an investment adviser or to sell securities—as the fund’s

manager. Once the account was established, IB performed standard brokerage

functions. The investors alleged that given IB’s mandatory-compliance-monitoring

obligations, IB should have known that it was supporting Antonas’s unlawful

activities.

{¶ 8} IB responded by filing a motion to dismiss the investors’ amended

complaint under Civ.R. 12(B)(6) for “fail[ure] to state any claim against [IB] upon

which relief may be granted for participating or aiding in sales of securities in

violation of the Ohio Securities Act, R.C. 1707.43.” In its motion to dismiss, IB

asserted that the investors had not alleged that IB had “played any role in Antonas’s

solicitation of investors, marketing of [Epitome], issuance of securities interests, or

sale of interests in the fund.” IB claimed that the investors’ failure to allege (and

their inability to allege) that they had purchased securities through the IB trading

account was fatal to their claims because R.C. 1707.43 permits a rescission remedy

only to purchasers in the unlawful sales of securities.

{¶ 9} The trial court granted IB’s motion to dismiss. The Eighth District

reversed, concluding that the allegations made by the investors in the amended

complaint “were legally sufficient to set forth a claim for relief under R.C.

1707.43(A).” 2024-Ohio-2905, ¶ 37 (8th Dist.).

{¶ 10} We accepted jurisdiction over IB’s sole proposition of law:

A financial institution such as a brokerage firm is not liable

for participating in an illegal sale of securities under R.C.

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January Term, 2026

1707.43(A) when its only connection to the sale to the [investors]

was peripheral and as part of its normal business activities.

See 2024-Ohio-5529.3

II. ANALYSIS

{¶ 11} We review a Civ.R. 12(B)(6) dismissal de novo, performing an

independent review of the record and giving no deference to the lower court’s

decision. See Perrysburg Twp. v. Rossford, 2004-Ohio-4362, ¶ 5. Because this

appeal stems from a motion to dismiss under Civ.R. 12(B)(6), we accept the factual

allegations in the amended complaint as true and make all reasonable inferences in

favor of the nonmoving party to determine, as a matter of law, whether the

allegations in the amended complaint state a claim for relief within the scope of

R.C. 1707.43(A). See Valentine v. Cedar Fair, L.P., 2022-Ohio-3710, ¶ 12.

Unsupported legal conclusions—such as assertions that IB aided in making the

securities sales to the investors—are not accepted as true unless supported by

factual allegations. See Mitchell v. Lawson Milk Co., 40 Ohio St.3d 190, 192-193

(1988). The question is not whether the plaintiffs will ultimately prevail, but

whether the factual allegations, which we assume to be true, describe conduct

falling within the purview of R.C. 1707.43(A). Here, the allegations related to IB’s

conduct, even if accepted as true, fall outside the statute’s scope.

{¶ 12} When the language of a statute is plain and unambiguous, we apply

it as written. Jones v. Action Coupling & Equip., Inc., 2003-Ohio-1099, ¶ 12;

Summerville v. Forest Park, 2010-Ohio-6280, ¶ 18. Here, the Eighth District erred

3. The dissent says that this appeal was improvidently accepted for discretionary review because the

question whether IB’s conduct relating to Antonas’s sale of securities was merely peripheral and

part of its normal business activities is an inappropriate question for this stage of review. But as

explained in the analysis, the trial court was correct in granting IB’s motion to dismiss because the

investors did not allege that IB played a role in the sale of the securities, and more than a peripheral

involvement is required for liability to attach under R.C. 1707.43(A).

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SUPREME COURT OF OHIO

when it focused on the remedial purpose of Ohio’s Blue Sky Law, also known as

the Ohio Securities Act (R.C. Ch. 1707), therefore broadening the reach of

R.C. 1707.43(A). But we do not elevate legislative intent over the plain text of a

statute.

{¶ 13} R.C. 1707.43(A) provides:

[E]very sale or contract for sale made in violation of

[R.C. Ch. 1707] is voidable at the election of the purchaser. The

person making such sale or contract for sale, and every person that

has participated in or aided the seller in any way in making such sale

or contract for sale, are jointly and severally liable to the

purchaser . . . .

{¶ 14} In interpreting the statutory text, each phrase must be given effect,

and no portion of the provision is read in isolation from the whole. See Vossman v.

AirNet Sys., Inc., 2020-Ohio-872, ¶ 14. As explained below, the phrase “in making

such sale” limits liability to every person whose conduct brings about the unlawful

sale itself, not to every person whose peripheral business functions can be

extraneously tied to the sale afterward. Similarly, the phrase “in any way” expands

the range of conduct that may qualify as participation or aid, but it operates within

the boundary of conduct that occurs “in making such sale.”

A. R.C. 1707.43(A) Requires a Nexus to the Unlawful Sale of Securities

{¶ 15} R.C. 1707.43(A) imposes liability for the unlawful sale of securities

on “[t]he person making such sale or contract for sale, and every person that has

participated in or aided the seller in any way in making such sale.” The phrase “in

making such sale” tethers liability to the sale itself. This court explained in Boyd

v. Kingdom Trust Co. that “[t]he plain language of R.C. 1707.43(A) requires a

person to have some nexus with the sale of illegal securities.” 2018-Ohio-3156,

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January Term, 2026

¶ 9. A connection to a broader investment scheme or transaction is not enough; the

statute demands involvement in the sale to the purchaser. Conduct that relates to

subsequent account activity also is not enough. The conduct must contribute to

making the sale. The investors argue that in opening a brokerage account for

Antonas after reviewing the PPM in which Antonas listed IB as Epitome’s broker,

IB’s actions lent legitimacy to Antonas’s scheme. But they do not allege that IB

drafted, endorsed, or distributed the PPM to them or that IB played any role in

presenting the PPM to them. By failing to assert a connection between IB and the

investors’ purchasing decisions, the allegations in the amended complaint are too

attenuated to satisfy the requirement in R.C. 1707.43(A) that IB participated or

aided Antonas “in any way in making such sale.”

{¶ 16} This interpretation is in accord with this court’s holding in Bronaugh

v. R. & E. Dredging Co., in which we recognized that the purpose of Ohio’s Blue

Sky Law is to deter those who sell or market unregistered securities, not to reach

peripheral participants in ordinary business transactions. 16 Ohio St.2d 35, 41

(1968). And R.C. 1707.43(A) limits liability for the unlawful sale of securities to

those persons who “participated in or aided the seller in any way in making such

sale.”

{¶ 17} In their amended complaint, the investors alleged that IB opened and

serviced a brokerage account for Epitome and that before IB opened the account, it

reviewed certain materials related to the investment fund. They do not allege any

conduct by IB tied to the solicitation of the investors or the offering, negotiation, or

execution of any sale of interests in Epitome. But liability does not arise when the

financial institution’s role was limited to executing transactions at the account

holder’s direction. See Boyd at ¶ 13; see also Boomershine v. Lifetime Capital, Inc.,

2008-Ohio-14, ¶15.

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B. R.C. 1707.43(A) Requires Participation or Aid in Making the Sale

{¶ 18} Even if a financial institution is connected to an unlawful sale of

securities, liability for the sale attaches only for conduct that constitutes

participation or aid “in making such sale,” R.C. 1707.43(A). The statute requires

conduct that furthers the unlawful sale itself. See Cent. Bank of Denver, N.A. v.

First Interstate Bank of Denver, 511 U.S. 164, 191-192 (1994) (civil liability by

secondary actors for violations of the Securities Exchange Act of 1934 requires

affirmative conduct expressly covered by statute); see also Cox Communications,

Inc. v. Sony Music Entertainment, 607 U.S. __, 146 S.Ct. 959, 969-972 (Mar. 25,

2026) (Sotomayor, J., concurring in the judgment) (contributory liability cannot rest

solely on a defendant’s knowledge of a violation coupled with insufficient action to

prevent it). Affirmative participation in the prohibited conduct is required.

{¶ 19} Decisions of other Ohio courts reinforce this affirmative-

participation requirement. In Federated Mgt. Co. v. Coopers & Lybrand, the Tenth

District Court of Appeals did not itself impose liability on a defendant under R.C.

1707.43 but instead held that because reasonable minds could come to different

conclusions on the issue whether the defendant’s conduct could be considered as

aiding the seller in any way in making the unlawful sales of certain financial notes,

summary judgment in favor of the defendant was inappropriate. 137 Ohio App.3d

366, 391-393 (10th Dist. 2000). Emphasizing evidence that suggested that the

defendant’s conduct went beyond ordinary commercial-banking activities and was

related to the actual note offering, the court reasoned that a jury could find that

evidence sufficient to satisfy the statute. Id. at 392-393. And in Boland v.

Hammond, the Fourth District Court of Appeals held that liability arose under R.C.

1707.43(A) against a person who directly relayed sales terms to investors and

arranged meetings with the seller of the securities at issue. 144 Ohio App.3d 89,

94-95 (4th Dist. 2001).

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January Term, 2026

{¶ 20} IB did neither of those things here; it did not undertake promotional

activity on behalf of Antonas or Epitome or relay sales terms to potential investors

nor did it arrange investor meetings. Its routine brokerage services were standard,

automated postsale functions. And IB’s performance of these normal business

activities lacks the nexus required to constitute its having “participated or aided” in

the unlawful sale of securities under R.C. 1707.43(A). The dissent says that IB’s

failure to exercise reasonable diligence in monitoring Antonas’s activity amounted

to participation in or aiding in the unlawful sale of securities. We disagree. Any

alleged failure by IB to exercise reasonable diligence in its compliance-monitoring

duties does not equate to participation or aiding in the unlawful sale of securities

by Antonas. See Boyd, 2018-Ohio-3156, at ¶ 9, 13.

C. R.C. 1707.43(A) Does Not Extend to Peripheral or Postsale Business

Activities

{¶ 21} The Eighth District essentially applied a “but for” causation theory,

concluding that the investors’ allegations in the amended complaint that IB’s

compliance-monitoring failures enabled Antonas to continue selling Epitome

interests were sufficient to plead that IB had participated or aided in the unlawful

sale of securities under R.C. 1707.43(A). 2024-Ohio-2905 at ¶ 35-37 (8th Dist.).

That interpretation conflicts with the text of the statute, however, and with the long-

held statutory interpretation by Ohio courts, which we reiterated in Boyd: “a

financial institution’s mere participation in a transaction, absent any aid or

participation in the sale of illegal securities, does not give rise to liability under

R.C. 1707.43(A),” Boyd at ¶13.

{¶ 22} Routine brokerage-firm functions that occur after the unlawful sale

of securities by the firm’s customer are not acts that constitute participating or

aiding “in making such sale,” R.C. 1707.43(A). The statute’s language requires a

nexus between the brokerage firm’s conduct and the unlawful sale of securities,

which, as explained above, is absent here.

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SUPREME COURT OF OHIO

{¶ 23} Even when viewed in the light most favorable to the investors, the

allegations in the amended complaint describe conduct that is not tied to the

solicitation, negotiation, or execution of any particular sale of securities: the

investors’ allegations refer to IB’s conduct as it relates to the management of funds

already invested in Epitome from the sale of unlawful securities, as opposed to

conduct that aided Antonas in any way in making such sales. IB’s alleged conduct

does not bear the required nexus to any specific sale of securities to the investors.

III. CONCLUSION

{¶ 24} R.C. 1707.43(A) imposes joint and several liability on every person

who makes, or participates or aids the seller in making, an unlawful sale of

securities. The statute requires a nexus between the person’s conduct and the sale

itself. The allegations in the amended complaint describe routine brokerage and

custodial services performed by IB after Antonas made unlawful sales of securities

to the investors, as well as conduct by IB before it opened the brokerage account

for Antonas, none of which has a nexus to any specific sale of securities to the

investors. Accordingly, IB did not participate or aid the seller in making such sales

to the investors. IB’s conduct, therefore, does not fall within the scope of

R.C. 1707.43(A).

{¶ 25} Because the investors’ amended complaint fails to state a claim upon

which relief can be granted under R.C. 1707.43(A), the trial court correctly

dismissed the amended complaint. The judgment of the Eighth District Court of

Appeals is therefore reversed, and the trial court’s judgment of dismissal is

reinstated.

Judgment reversed

and trial court’s judgment reinstated.

__________________

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January Term, 2026

BRUNNER, J., dissenting.

{¶ 26} The Eighth District Court of Appeals applied the correct standard of

review—the same legal standard announced in the majority opinion, see majority

opinion, ¶ 12-14—and correctly remanded this case to the trial court for further

factual development. For these reasons, we should not have accepted the

proposition of law submitted by appellant, Interactive Brokers, L.L.C., for

discretionary review.

{¶ 27} In relaying my reasons for dissenting from the court’s judgment, I

rely on the factual and procedural background set forth in the majority opinion. The

question whether Interactive Brokers’ conduct relating to the sale of securities by

Constantine Antonas in his management of the private-investment hedge fund

Epitome Investment Fund, L.P. (“Epitome”) was merely peripheral and part of its

normal business activities or whether its conduct constituted “aid[ing] the seller in

any way in making [an unlawful] sale,” R.C. 1707.43(A), is an inappropriate

question for this stage of review.

{¶ 28} Unfortunately, the majority opinion has adopted a reading of R.C.

1707.43(A) that is wildly untethered to its text. Incredibly, and in direct opposition

to the statute’s plain language, the majority opinion concludes that a financial

institution bears liability for the unlawful sale of securities to which it is connected

only if a plaintiff demonstrates that the institution acted knowingly or intentionally

in aiding the unlawful sale, see majority opinion at ¶ 15.

{¶ 29} R.C. 1707.43(A) creates liability for every person or entity who

“participated in or aided the seller in any way.” (Emphasis added.) The phrase “in

any way” could not be clearer; when a statute makes no mention of mental

culpability, we are bound not to infer one. See State v. Johnson, 2010-Ohio-6301,

¶ 17 (“Offenses without any culpable mental state are strict-liability offenses, and

they impose liability for simply doing a prohibited act.”).

{¶ 30} The majority opinion cites Cent. Bank of Denver, N.A. v. First

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Interstate Bank of Denver, 511 U.S. 164, 191-192 (1994), in support of its

determination that R.C. 1707.43(A) requires a showing that the financial institution

acted with intent or knowledge in aiding in the unlawful sale of securities. But the

United States Supreme Court never explained what level of culpability should be

attributed to an “aiding and abetting” claim under the Securities Exchange Act of

1934, because the law contained no provision for that kind of secondary liability.

Cent. Bank of Denver at 191. Cent. Bank of Denver is not only irrelevant, but it

also does not support the majority opinion’s magic trick of adding an element of

mental culpability to what was otherwise a question whether participation or aiding

in an unlawful sale of securities had occurred. Federal courts have recognized that

state provisions like R.C. 1707.43(A) are much broader than their federal

counterparts and generally require no mental culpability. See Riedel v. Acutote of

Colorado, 773 F.Supp. 1055, 1066 (S.D.Ohio 1991) (scienter is generally not

required under laws like R.C. 1707.43).

{¶ 31} The fundamental purpose of R.C. Ch. 1707 is to protect the public

from the sale of unregistered securities. Callahan v. Class One, Inc., 58 Ohio St.3d

76, 77 (1991). It is no surprise that commentators have found statutory schemes

such as the one in R.C. Ch. 1707 to place an affirmative duty on “all securities

professionals involved in a securities transaction . . . to exercise due diligence” in

ensuring that the registration and antifraud protections of such laws are complied

with. Joseph C. Long, Developments and Issues in Civil Liability Under Blue Sky

Law, 62 U.Cin.L.Rev. 439, 468 (1993). The majority opinion is impermissibly

adding to the plain and simple language that the General Assembly used in

R.C. 1707.43(A). Under this law—as clearly written—a financial institution’s

involvement in the unlawful sale of securities either occurred or it did not, and that

involvement may include the institution’s failing to have reasonable mechanisms

in place to discover the unlawfulness of securities sales in which the institution

participates or which the institution aids the seller in making.

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January Term, 2026

{¶ 32} By its own concession, Interactive Brokers was authorized to

monitor and perform compliance activities to prevent potential unlawful activity.

Appellees, 21 aggrieved investors in Epitome, see majority opinion at ¶ 2, fn. 1,

alleged in their amended complaint that despite its mandatory compliance

monitoring, Interactive Brokers did not verify the registration status of the hedge-

fund operator, approved large withdrawals, and ignored other “red flags” indicating

unlawful trading activity until the $25 million that was initially invested was nearly

depleted. These facts—accepted as true when reviewing a judgment of dismissal

issued on a Civ.R. 12(B)(6) motion—are sufficient to plead a claim under

R.C. 1707.43(A) that Interactive Brokers’ failure to exercise reasonable diligence

amounted to participation in or aiding in the unlawful sale of securities. The parties

have a right to test these allegations against the evidence developed in discovery.

See Ohio Const., art. I, § 5 (“The right of trial by jury shall be inviolate . . . .”);

Ohio Const., art. I, § 16 (“every person, for an injury done him in his land, goods,

person, or reputation, shall have remedy by due course of law”).

{¶ 33} Once again, this court has positioned itself as a “super fact-finder”

by declaring as a matter of law the answers to questions of fact that are clearly

within the purview of a jury. See NC Ents., L.L.C. v. Norfolk & W. Ry. Co., 2026-

Ohio-1429, ¶ 31 (Brunner, J., dissenting). Once again, we have unnecessarily and

unfairly deprived parties of the right to seek justice before a trial even begins. See

id. at ¶ 29 (finding that, as a matter of law, lawn-maintenance activities can never

be sufficiently open and notorious to put a landowner on notice that a would-be

adverse possessor is taking over the land); Berkheimer v. REKM, L.L.C., 2024-

Ohio-2787, ¶ 25 (finding that reasonable minds could come to but one conclusion

about whether a consumer should expect to encounter a bone in a boneless chicken

wing). The majority opinion today would have this court acting not only as the

judge and jury, but also as the legislature. Today’s decision is out of line with the

purpose of R.C. Ch. 1707 and makes it nearly impossible for victims of securities

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fraud to obtain relief from a financial institution that may have “participated in or

aided the seller in any way in making” the unlawful sale of securities,

R.C. 1707.43(A). I therefore dissent. I would dismiss this case as having been

improvidently accepted.

__________________

Meyer Wilson Co., L.P.A., David P. Meyer, Courtney M. Werning, and

Jared W. Connors; and Cooper Elliott, Rex H. Elliott, Barton R. Keyes, and

Kimberly E. Burroughs, for appellees.

Jones Day, Geoffrey J. Ritts, James R. Saywell, Samuel V. Lioi, Yvette

McGee Brown, and H. Cole Hassay; and UB Greensfelder, L.L.P., and Jeffrey S.

Dunlap, for appellant Interactive Brokers, L.L.C.

Rosca Scarlato, L.L.C., and Alan L. Rosca, urging affirmance for amicus

curiae Public Investors Advocate Bar Association.

Bricker Graydon, L.L.P., Brodi J. Conover, and Ryan L. Richardson, urging

reversal for amicus curiae The Securities Industry and Financial Markets

Association and the Ohio Bankers League.

__________________

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