Page:United States Statutes at Large Volume 48 Part 1.djvu/108

 82 Civil li abili ties for false registration state- ment. Post, p 907. Responsibility of sig- nator. Director, partner, etc . Prosp ectiv e di recto r, partnev, etc. Accountant's, etc. , state ment s. Underwriter to such security. Exemp tion, if bur- den of proof sustnined . Resignation, etc ., be- fore effective date of statement. Notification to Com- mission, etc ., ac cor d- ingly. Advised comm ission of false statement. Public notice, addi- tional. Bel ief in probi ty of s tatem ents, not expe rt, etc. No material fa ct omitted. St atement mad e as expert true. 73d CONGRESS. SESS. I. CH. 38. MAY 27, 1933 CIVIL LIABILITIES ON ACCOUNT OF FALSE REGISTRATION STATEMENT SEC. 11 . (a) In case any part of the reistration statement, when such part became effective, contained au-' untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, any person acquiring such security (unless it is proved that at the time of such acquisition he knew of such untruth or omission) may, either at law or in equity, in any court of competent jurisdiction, sue- (1 every person who signed the registration statement ; (2 every person who was a director of (or person perform- ing similar funct ions) o r partn er in, the is suer at the t ime of the filing of the part of the registration statement with respect to which his liability is asserted ; (3) every perso n who, with his c onsent, is named in the registration statement as being or about to become a director, person performing similar functions, or partner ; (4) every accountant, engineer, or appraiser, or any person whose profession gives authority to a statement made by him, who has with his consent been named as having prepared or certified any part of the registration statement, or as having prepared or certified any report or valuation which is used in connection with the registration statement, with respect to the st atem ent in s uch regi stra tion sta teme nt, repo rt, or v alua tion , which purports to have been prepared or certified by him ; (5) every underwriter with respect to such security. (b) Notwithstanding the provisions of subsection (a) no person, other than the issuer, shall be liable as provided therein who shall sustain the burden of proof- (1) that before the effective date of the part of the registra- tion statement with respect to which his liability is asserted (A) he had resigned from or had taken such steps as are permitted by law to resign from, or ceased or refused to act in, every office, capacity, or relationship in which he was described in the regis- tration statement as acting or agreeing to act, and (B) he had advised the Commissi on and the iss uer in writin g that he had taken such action and that he would not be responsible for such part of the registration statement ; or (2) that if such part o f the registr ation stateme nt became effective without his knowledge, upon becoming aware of such fact he forthwith acted and advised the Commission, in accord- ance with paragraph (1), and, in a ddition, gave reasonable public notice that such part of the registration statement had become effective without his knowledge ; or (3) that (A) as regards any part of the registration state- ment not purporting to be made on th e authority o f an expert, and not purporting to be a copy of or extract from a report or valuation of an expert, and not purporting to be made on the authority of a public official document or statement, he had, after reasonable investigation, reasonable ground to believe and did believe, at the time such part of the registration statement became effective, that the statements therein were true and that there was no omission to state a material fact required to be stated therein o r necessary to make the sta tements there in not mis- leading ; and (B) as regards any part of the registration state- ment purporting to be made upon his authority as an expert or purporting to be a copy of or extract from a report or valuation of himself as an expert, (i) he had, after reasonable