Civil Liabilities
Chapters in this video
- 0:00 Private right of action under the USA
- 1:06 Burden of proof: seller must prove innocence
- 2:27 Rescission versus damages formulas
- 3:09 Control persons and material aiding liability
- 4:05 Statute of limitations: two clocks, earlier wins
- 5:26 Rescission offer trap: silence always loses
- 7:17 Survival of claims and the waiver rule
- 7:53 Rapid-fire exam recap
What this video covers
- Why the seller bears the burden of proof on fraud claims, and the exact two-part defense they must prove: lack of knowledge plus due diligence
- Why registration violations are strict liability, and why good faith or reasonable belief in an exemption is never a defense
- How to calculate rescission when the buyer still owns the security, versus damages when the buyer has already sold
- What joint and several liability means for control persons and anyone who materially aids a violation, and the narrower defense available to them
- The two-clock statute of limitations: 3 years from the sale versus 2 years from discovery, and why the earlier expiration always controls
- Why silence to a rescission offer always loses, and when written rejection within 30 days is required to preserve the right to sue
- Why waivers of USA rights are void but pre-dispute arbitration clauses are valid, and why causes of action survive the death of either party
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