Also found in: Dictionary, Legal.
Blue Sky Laws
Laws requiring research and transparency to ensure that a new issue of a security complies with applicable laws in the state in which they are issued. It especially refers to laws protecting investors from securities fraud. The term became popular when U.S. Supreme Court Justice Joseph McKenna wrote in Hall vs. Geiger-Jones Company (1917) that he wished to protect investors from securities with "no more basis than so many feet of 'blue sky.'" See also: Due Diligence.
A popular name for state securities laws intended to protect investors and aid them in making informed buying decisions rather than taking the word of a smooth-talking salesperson who “promises the sky.”