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Question
Frank is the president and CEO of a publicly held corporation and is quoted in the paper as saying that the company is solid and has a bright future. He mentions a number of projects and plans that he anticipates will be successful in both the short term and long term, thus benefiting the company. Betty Sue reads this article and calls a broker, directing him to buy shares in Frank's company. After two years the stock is below the price she paid for it, and she brings suit, claiming that Frank committed a fraud when he stated that the company was solid and would be very successful in the future. What must be proved by each side, and what is the likely outcome of this suit?
Answer
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