Section 11 of the 1933 Act is considered a radical liability section because the defendant has the burden of proving that he exercised due diligence.

Question

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Section 11 of the 1933 Act imposes strict liability on issuers of securities for any material misstatements or omissions in the registration statement. The burden of proof is on the defendant to show that he or she conducted due diligence and had reasonable grounds to believe that the registration statement was accurate and complete. This places a significant burden on the defendant and is considered a radical approach to establishing liability for securities fraud.

Section 11 of the 1933 Act Is Considered a Radical