Matty Is an Employee of ValCom but Doe Not Own

question 11

Multiple Choice

Matty is an employee of ValCom but doe not own any ValCom stock.At her five year employment anniversary, she decides to buy 50 shares of a new issue of company stock as a savings plan and afterward receives the signed registration statement.  Because of her employment at ValCom, she recognizes that the statement contains an untrue material fact.Can she sue the auditor?

• A) Yes, under Section 11, proof of reliance is usually not required.
• B) Yes, if she can prove she would not have bought the stock otherwise.
• C) No, because there is no privity between Matty and the auditor.
• D) No, because she did not rely on the statement.

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Definitions:

Craft Unions

Labor organizations representing workers who share the same or similar skills in a particular craft or trade.

Scientific Management

A management theory that analyzes and synthesizes workflows, aiming to improve economic efficiency and labor productivity.

Managerial Subjectivity

The influence of personal biases, preferences, and opinions of managers in their decision-making processes, potentially affecting objectivity in evaluations and judgements.

Union Representatives

Individuals elected or appointed to represent the interests of union members in discussions and negotiations with employer representatives.