Directors will be found liable, unless the directors can convince the court they satisfy one of the following defenses "36- a) They made all inquires that were reasonable in the circumstances b) They believed on reasonable grounds that the statement was not misleading and that there were no omission from the prospectus c) They relied on information given by someone other than a director, employee or agent of the company. 137 In this particular case, all three of the above conditions may be argued by the directors of Worldwide News. It may be put to the court that the directors hired a professional solicitor to deal with the issue of foreign ownership of broadcasting rights, and relied solely on the solicitors' advice regarding this issue. If the court is to accept such a defense, the directors will escape personal liability. In the event the court is not satisfied with the defense above, the breach gives rise to civil liability for defective disclosure, whereby the directors will be liable for the compensating investors for financial loss or damage caused by the inclusion of such a statement. "If the defect is found to be materially adverse from the point of view of an investor, such a misleading statement may give rise to criminal liability which may include imprisonment, a fine or a combination of the two. It is most likely Worldwide News will not be found guilty of the latter. One may assume that the auditor will escape liability as the auditor clearly states that he evaluated the forecasted income and profit based on the information provided by the directors and hence, was not at fault for receiving incorrect information. On the other hand, if investors wish to sue the solicitor, they may do so as he would be held liable for the advice given to directors, and hence disclosed to shareholders. The solicitor would be found guilty under professional neglect as he failed to take into account certain rules and regulations, and it was his professional duty to do so