SEC Clarifies Company Use of Social Media Under Regulation FD

Summary: Recognizing that there is uncertainty concerning how Regulation FD and the SEC’s 2008 Guidance on the Use of Company Web Sites apply to disclosures made through social media channels, the SEC issued a Report of Investigation to provide guidance as to the application of Regulation FD to disclosures through social media. The SEC also announced that it would not pursue enforcement action against Netflix, Inc. or Mr. Reed Hastings, its CEO, related to the use by Mr. Hastings of his personal Facebook page to announce that Netflix had streamed over one billion hours of content in one month for the first time, although the SEC’s analysis suggests that Mr. Hastings’ actions raised serious issues as to compliance with Regulation FD.