Basic v. Levinson Questions 1. What test does the Court say applies to determine whether the misstatements made by Basic were material? Why does the Court go with this test instead of the TSC Industries test? 2. In light of this case, what would you advise a client who is involved in preliminary merger discussions to do in response to a media inquiry regarding whether the client is involved in merger discussions? 3. What is the fraud-on-the-market theory? What does it have to do with whether a plaintiff relied on a misstatement or omission? 4. What does a plaintiff need to show to meet the reliance element under the theory? 5. How can a defendant rebut the presumption of reliance?