Assume that in the process of making a private offering under Regulation D, one of the friends sends and email to a potential investor while he is on vacation out of state. It reads, "In order to address your concerns about the potential purchase of high-end fake wines at auction, we will employ a forgery expert to attend all auctions with our sommelier to authenticate each bottle prior to purchase." However, the three friends had previously agreed that sending an authentication expert to all the auctions would be costly and therefore they would rather spend the money in other areas. Is the friend liable under the 1933 Act if no expert attends the auctions and the sommelier purchases fake wines?
a. No, the statement was not material to the sale of the security.
b. Yes, he is liable under Section 12(a)(2) and may be sued for fraud by both the SEC and the purchaser of the stock.
c. Yes, he is liable under Section 12(a)(2) and may be sued by the purchaser of the stock if the purchaser determines the value of the stock to be less than what he paid.
d. No, private offerings are not subject to liability rules under the 1933 Act.