Securities Law Commons^™

Erosion Of The Privity Requirement In Section 12(2) Of The Securities Act Of 1933: The Expanded Meaning, Patricia O'Hara

Journal Articles

Section 12(2) of the Securities Act of 1933 provides a securities purchaser with an express cause of action against his seller if the purchaser can establish that the seller used interstate commerce or the mails to offer or sell a security by means of a written or oral communication which misstated or omitted to state a material fact of which the purchaser was unaware. Upon proof of the foregoing, the purchaser is entitled to rescind his purchase or, in the event he no longer owns the security, to recover equivalent damages unless the seller sustains the burden of proving that …