Which of the Following Was the Result on Appeal in the Case

question 71

Multiple Choice

Which of the following was the result on appeal in the case in the text In re Century Aluminum Company Securities Litigation,the case in the text involving plaintiffs who purchased secondary-offering shares and who attempted to sue under Section 11 of the Securities Act of 1933 for misrepresentations allegedly released regarding the secondary offering?

• A)The court allowed the case to proceed contingent on the plaintiffs submitting proof by an expert that misrepresentations occurred.
• B)The court affirmed the trial court's dismissal of the case recognizing that it is impossible as a matter of law for purchasers of aftermarket shares to have claims based on Section 11 because Section 11 does not apply to secondary-offering shares.
• C)The court affirmed the trial court's dismissal of the case recognizing that it is often impossible for purchasers of aftermarket shares to have claims based on Section 11 because they normally purchase through brokers that do not acknowledge the source of the shares.
• D)The court affirmed the trial court's dismissal of the case recognizing that the plaintiffs had not submitted sufficient evidence of misrepresentations.
• E)Finding that the plaintiffs had met all prerequisites in regard to proof,the court ruled that the case should be allowed to proceed to trial.

---

Definitions:

Equity-Method Investments

An accounting treatment for investments in which the investor has significant influence over the investee, typically between 20% and 50% ownership, requiring the investor to include its share of the investee's income.

Trading Security

A financial instrument held by a firm primarily for the purpose of selling it in the short term for profit.

Available-for-sale Security

Financial securities that are not classified as held-for-trading or held-to-maturity, and thus can be sold in the market.

Accounting

The systematic process of recording, summarizing, analyzing, and reporting financial transactions of a business or individual.