Susan is a potential investor in MegaCo. Susan learns of a press conference held by MegaCo in which the CEO knowingly states that there are no merger negotiations between MegaCo and another company. As a result, Susan decides not to purchase stock in MegaCo. Three weeks later the public learns that, contrary to what the CEO stated, MegaCo was actually in merger negotiations with another company. The stock price of MegaCo rises as a result, and Susan sues MegaCo for violation of SEC Rule 10b-5. Susan will likely:

a. not win, because the misrepresentation did not occur in connection with the purchase or sale of stock.
b. not win, because the CEO of MegaCo did not have a wrongful state of mind when he made the false merger statement.
c. not win, because she did not rely on the misstatement.
d. prove all elements of her 10b-5 claim

Ans: a. not win, because the misrepresentation did not occur in connection with the purchase or sale of stock.