DotCom,Inc. ,told an investor that it had hired an investment firm to take the company public.However,DotCom had not in fact hired an investment firm and instead went bankrupt a year after the investor's purchase of significant shares.When the investor sues,DotCom claims that its prospectus includes the cautionary statements required by law,and thus cannot be held liable under the safe harbor provision of the Private Securities Litigation Reform Act.Would DotCom likely be held liable for the investor's loss?

Question

Quizplus · Accepted Answer

A)At least one Court of Appeals has found that the safe harbor provision of the Private Securities Litigation Reform Act does not protect issuers when they make statements about the past or present,only the future.The court said that "it would be perverse indeed if an offeror could knowingly misrepresent historical facts but at the same time disclaim those misrepresented facts with cautionary language.
B)At least one Court of Appeals has found that the safe harbor provision of the Private Securities Litigation Reform Act does not protect issuers when they make statements about the past or present,only the future.The court said that "it would be perverse indeed if an offeror could knowingly misrepresent historical facts but at the same time disclaim those misrepresented facts with cautionary language.
C)At least one Court of Appeals has found that the safe harbor provision of the Private Securities Litigation Reform Act does not protect issuers when they make statements about the past or present,only the future.The court said that "it would be perverse indeed if an offeror could knowingly misrepresent historical facts but at the same time disclaim those misrepresented facts with cautionary language.
D)At least one Court of Appeals has found that the safe harbor provision of the Private Securities Litigation Reform Act does not protect issuers when they make statements about the past or present,only the future.The court said that "it would be perverse indeed if an offeror could knowingly misrepresent historical facts but at the same time disclaim those misrepresented facts with cautionary language.
E)At least one Court of Appeals has found that the safe harbor provision of the Private Securities Litigation Reform Act does not protect issuers when they make statements about the past or present,only the future.The court said that "it would be perverse indeed if an offeror could knowingly misrepresent historical facts but at the same time disclaim those misrepresented facts with cautionary language.