Under the Securities Act of 1933, a third-party plaintiff does not have the burden of proof that he or she relied on the financial statements or that the auditor was negligent or fraudulent in doing the audit. Rather, the plaintiff need only prove that the audited financial statements contained a material misrepresentation or omission.

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According to the Securities Act of 1933, a third-party plaintiff does not need to prove reliance or negligence/fraud, but only needs to prove material misrepresentation or omission in the audited financial statements.

Under the Securities Act of 1933, a Third-Party Plaintiff Does