Question
Facts: Corp is a publicly held corporation whose stock is registered under Section 12 of the Securities Exchange Act of 1934. The following sequence of
Facts: Corp is a publicly held corporation whose stock is registered under Section 12 of the Securities Exchange Act of 1934. The following sequence of events occurred in 2014:
January 2: Corp publicly announced that it expected a 25% revenue increase this year.
March 1: Debbie, a Corp director, needing cash to buy a car sold 1,000 Corp shares for $25 each.
June 15: Corp learned that, because of unforeseen expenses, its revenues would decrease by 50% this year, contrary to its January 2 announcement.
June 16: Olivia, a Corp officer, consulted Larry, her lawyer, for personal tax advice. Olivia mentioned, among other things, the probable devaluation of her Corp stock.
June 17: Larry telephoned his stockbroker and shorted 1,000 Corp Shares at $20 a share.
June 18: Corp publicly announced that its revenues would decrease by 50% this. Its stock price fell from $25 to $5 per share.
June 19: Larry bought 1,000 Corp shares at $5 per share to cover his short sale, making a profit of $15,000 on the transaction.
July 1: Debbie, believing the company was fundamentally sound and undervalued, bought 1,000 Corp shares for $5 per share.
Question: On the following dates: March 1, June 16, June 17, June 19 and July 1, which of the actions by Debbie, Olivia and Larry constituted a violation of federal securities laws and which did not?
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