In Corporate and Securities Law
Within the context of corporate and securities law in the United States, a fact is defined as material if there is a substantial likelihood that a reasonable shareholder would consider it important in deciding how to vote. In this regard, it is similar to the accounting term of the same name.
Materiality is particularly important in the context of securities law, because under the Securities Exchange Act of 1934, a company can be held civilly or criminally liable for false, misleading, or omitted statements of fact in proxy statements and other documents, if the fact in question is found by the court to have been material.
Read more about this topic: Materiality (law)
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