In Silver Hills May Tarnish Crowdfunding, I wrote about Justice Roger J. Traynor's alternative definition of "security" under the predecessor to the Corporate Securities Law of 1968. Silver Hills Country Club v. Sobieski, 55 Cal. 2d 811 (1961) Justice Traynor's definition may cause problems for crowdfunders who are relying on the fact that their arrangements don't meet the definition of an "investment contract" established by the U.S. Supreme Court in Securities & Exchange Commission v. W.J. Howey Co., 328 U.S. 293 (1946).
Justice Traynor's opinions have been extremely influential. That has certainly been the case with "risk capital" test that Justice Traynor enunciated in his Silver Hills opinion. Other states have adopted the risk capital definition by:
You may want to check your own state's laws, regulations and case law.
Although Justice Traynor has many fans, U.S. Circuit Court Judge Alex Kozinski isn't one of them (at least with respect to Justice Traynor's approach to contract interpretation):
I had grown tired of law clerks who thought California Chief Justice Traynor was the cat's pajamas because he didn't believe that any contract could be interpreted without the use of extrinsic evidence. Whenever I would get a case where I thought the contract language was clear, they would quote me back some idiot line from Traynor about how this merely reflected the effete linguistic prejudices of judges.
Who Gives A Hoot About Legal Scholarship?, 37 Hous. L. Rev. 295, 298 (2000). If you haven't read this, it's short and very entertaining.