Nina, an accountant, prepares for Opal Corporation a financial state?ment that misstates a material fact. The statement is included in Opal's regis?tration statement. Pete, who is in privity with Nina, and Quinn, who is not, each buy Opal stock. Under Section 11 of the Securities Act of 1933, Nina may be liable to

Question

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Section 11 of the Securities Act of 1933 imposes strict liability on any person who includes a material misstatement in a registration statement. Both Pete and Quinn purchased Opal stock, and therefore they are entitled to sue under Section 11. While privity is not required for liability, it may affect the measure of damages. Thus, both Pete and Quinn may have a valid claim against Nina.

Nina, an Accountant, Prepares for Opal Corporation a Financial State?ment