Thus, under Basic, if a plaintiff shows that the defendant's misrepresentation was public and material and that the stock traded in a generally efficient market, he is entitled to a presumption that the misrepresentation affected the stock price.
Within weeks, ABC returns Good Eats' premium and files an action to rescind the insurance policy for policy year 2 based upon the material misrepresentations regarding security in the insurance application.
However, the IC said Funa was 'unconvinced by the explanation given by Caritas Health' as the company itself 'acknowledged that there have been instances of unauthorized swiping and misrepresentations committed by its sales agents.'
It brought this action for a declaratory judgment that the policy at issue was void ab initio based on material misrepresentations. The court granted partial summary judgment on the issues of whether Abruzzino made misrepresentations in procuring the policy.