1933 Act – Sections 12 and 17

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  • June 19, 2013 at 9:05 pm #178255
    barelystayingsane
    Member

    In Becker R7, Olinto said the Antifraud Sections of the 1933 Act (Sections 12 and 17) apply to unregistered/exempt securities and I also came across a review question that reinforced that. However, in a table that compares the 1933 Act and the 1934 Act at the end of the section, the book says that for the 1933 Act, the misleading statement/omission must be in the registration statement and it covers securities covered by the registration statement. How can Sections 12 and 17 apply to an unregistered security if the fraudulent statement must be in the registration statement?

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  • June 19, 2013 at 11:10 pm #424351
    barelystayingsane
    Member

    One other question regarding this Sections 12 and 17… I was under the impression that Section 11 was very separate from Sections 12 and 17. Section 11 deals with misstatements, whether intentional or unintentional, whereas Sections 12 and 17 deal with fraud. I know you don't need to prove reliance, causation, or scienter for Section 11, but why don't you have to prove them for Sections 12 and 17 (anti-fraud provisions)?

    Any guidance you guys could give me would be greatly appreciated!!!

    June 21, 2013 at 3:40 pm #424352
    barelystayingsane
    Member

    bump

    June 28, 2013 at 5:26 am #424353
    barelystayingsane
    Member

    Hey guys, still wondering about these questions if you're able to help me out! Also, are punitive damages available under Rule 10b-5? In one area of my notes, I wrote down that they are. A couple of pages later, I wrote down that they aren't. I'm leaning towards punitive damages are NOT allowed under Rule 10b-5, but can anybody confirm?

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