Fast Auditors prepared audited financial statements for Mega Company's registration statement in compliance with the 1933 Securities Act. John bought stock in Mega Company. It was discovered that the financial statements prepared for the registration statement contained some important omissions. John sued Fast Auditors to recover his investment when Mega Company turned out to be a bad investment. What must John prove to recover from Fast Auditors?
What will be an ideal response?
To prevail under Section 11 of the 1933 Act, John must prove only that the registration statement contained a material misstatement or omission, and he lost money.
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