Eric Trojan is a licensed securities broker.On January 1, he had lunch with his good friend Sarah Bruin, the vice president of communications for clothing retailer LA Apparel, Inc.During lunch, Sarah mentioned that LA Apparel was almost ready to announce the completion of the acquisition of its largest competitor, Westwood Clothing Corporation.

Near the end of their lunch, Eric's client Jason Laker dropped by the table to say hello.Eric mentioned to Sarah that Jason owns shares of LA Apparel and Eric quipped with a big smile that Jason should watch out for some big news in the coming days.After hearing this, later that afternoon, Jason called Eric and instructed Eric to buy 1,000 more shares of Westwood Clothing at $40 per share.

Five days later, LA Apparel announced its acquisition of Westwood Clothing and, within hours, the price of LA Apparel's stock increased to $45 per share.

Discuss the liability, if any, of Eric, Sarah and Jason under Rule 10b-5 of the Exchange Act.