Ms. Johnson is an independent window washer who has been hired to wash the windows of the Jensen headquarters building. While scrubbing on a window on the 67th floor, she hears (through a ventilation screen) the president and the chairman of the board discussing, in confidence, that the corporation has discovered a new growth hormone. The two officers are drafting a press release that will be disclosed to the public at noon the next day. Ms. Johnson immediately calls her broker, and instructs him to buy 25,000 shares of Jensen’s stock. The next day, the price of the stock jumps from $80 a share to $160 a share and Ms. Johnson sells, having just made a cool million. When she brags about what she has done at the local restaurant, an agent of the SEC overhears her and turns her in. The SEC then sues Ms. Johnson for violating the SEC’s Rule 10b-5. Is Ms. Johnson liable? Explain your answer.

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