SEC IPO Rules of Securities Exchange Act of 1934

SEC IPO Rules of Securities Exchange Act of 1934

There are some important sections of Securities Exchange Act of 1934, which often be cited in opinions and orders of securities fraud cases.

Section 10(b)
Section 10(b) of Securities Exchange Act of 1934 provides that “It shall be unlawful … (a) To effect a short sale … of any security … in contravention of such rules and regulations as the commission may prescribe … (b) To use or employ, in connection with the purchase or sale of any security … any manipulative or deceptive device or contrivance in contravention of such rules and regulations as the commission may prescribe.”

Section 14
Section 14(a) of Securities Exchange Act of 1934 provides that “It shall be unlawful for any person, by use of the mails … or otherwise … to solicit or permit the use of his name to solicit any proxy or consent or authorization in respect of any security (other than an exempted security) registered pursuant to Section 12 of this title.”

Section 20
Section 20 of Securities Exchange Act of 1934 provides that “Every person who, directly or indirectly, controls any person liable under any provision of this title … shall also be liable jointly and severally with and to the same extent as such controlled person to any person to whom such controlled person is liable unless the controlling person acted in good faith and did not directly or indirectly induce the act or acts constituting the violation or cause of action.”