We recently bought a house with a dry basement but every since we bought it it has not just leaked but flooded!

These are really tough cases.  In order to prevail, you would have to prove that the sellers knew about the problem and either failed to disclose it to you or failed to disclose the extent of the problem.  That usually is hard to accomplish.  Just because you got flooded doesn't mean that the sellers know of of a problem.  What makes them more difficult is that you won't get your attorneys fees and costs paid if you are successful.  The cost of the fix would have to be fairly significant in order to justify the costs of litigation.  You should expect to pay no less than $5,000 in legal fees to pursue the case -- and quite possibly more.