Small investors accused a prominent Encino real estate brokerage and a former Orange County businessman in a lawsuit Wednesday of taking part in an elaborate scam that fleeced individual investors out of millions of dollars in recent years.

The lawsuit, filed in federal court in San Jose, alleges that brokers at Marcus & Millichap allegedly took part in a conspiracy to buy small commercial properties, artificially inflate their values and sell them to unsuspecting investors.

The lawsuit was filed as a class action on behalf of 16 investors, mostly Californians, who bought 22 properties in four states. The suit seeks as much as $70 million in compensatory damages and up to $200 million altogether with punitive damages and treble damages under the Racketeer Influenced and Corrupt Organizations law.

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