Without proving reliance

3. In which of the following types of action, brought against a CPA who issues an audit report containing an unqualified opinion on materially misstated financial statements, may a plaintiff prevail without proving reliance on the audit report?

a. An action for common law fraud.

b. An action for common law breach of contract.

c. An action brought under Section 11 of the Securities Act of 1933.

d. An action brought under Rule 10b-5 of the Securities Exchange Act of 1934.

Choice "c" is correct. A plaintiff need only prove three elements to recover under section 11 – the plaintiff acquired the stock, the registration statement was signed by the CPA and contains a material misrepresentation or omission of fact, and damages. All of the other causes of action listed require proof of reliance.