A Security Is Sold to the Public Under a Private

A security is sold to the public under a private placement exemption. Later a suit is filed under federal securities law claiming securities fraud. This suit will:

A) fail since the security is not subject to the federal law since it was sold under an exemption
B) fail since the security is not subject to the federal law since it was sold under an exemption⎯unless there were subsequent financial disclosures to the SEC
C) fail since the security is not subject to the federal law since it was sold under an exemption⎯unless a private common law fraud suit has already prevailed
D) be allowed since all securities are subject to the law
E) none of the other choices