[Party Business, Inc.] Lila, who is the president of Party Business, Inc., tells Isaiah that buying stock in Party Business, Inc. right now is a good idea. Isaiah is only casually acquainted with Lila and does not know that she is an officer of the corporation. He, however, acting on her information which he believes to be public knowledge, investigates the company somewhat and proceeds to buy some stock. Both Lila and Isaiah are charged with insider trading.
-If Isaiah claims he was acting on Lila's information which he believed to be public knowledge, which defense could he claim?

Question

Quizplus · Accepted Answer

Isaiah could claim a mistake-of-fact defense because he acted on information he believed to be public, not knowing Lila's insider status or that the information might be considered insider trading.