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The common stock of Wilson, Inc. is owned by 10,000 stockholders who live in several...

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Accounting

The common stock of Wilson, Inc. is owned by 10,000 stockholders who live in several states. Wilsons financial statements as of December 31, 2021, were audited by Doe & Co., CPAs, who rendered an unqualified opinion on the financial statements. In reliance on Wilsons financial statements, which showed net income for 2021 of $1.5 million, Peters, on April 10, 2022, purchased 10,000 shares of Wilson stock for $200,000. The purchase was from a shareholder who lived in another state. Wilsons financial statements contained material misstatements. Because Doe did not carefully follow GAAS, it did not discover that the statements failed to reflect unrecorded expenses that reduced Wilsons actual net income to $800,000. After disclosure of the corrected financial statements, Peters sold his shares for $100,000, which was the highest price he could obtain. Peters has brought an action against Doe under federal securities law and state common law. Answer the following and give explanations please.

(1) Will Peters prevail on his federal securities law claims?

(2) Will Peters prevail on his state common law claims?

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