On April 2nd, the SEC issued a report of investigation that makes clear public companies may use social media such as Twitter and Facebook to announce information in compliance with Regulation FD as long as the companies made investors aware in advance which social media will be used to disseminate the information. Given the increasing frequency with which public companies are using social media to engage with clients, customers, employees, shareholders and other key constituents, the guidance in the Report is welcome.
According to a new Client Alert I received from Skadden’s Brian Breheny, the guidance aims to remove uncertainty among companies and their advisors by explicitly stating that company communications, including those of its officers or directors, made through social media should be evaluated for compliance with Regulation FD by applying the framework set forth in the SEC’s 2008 interpretative guidance applicable to company websites. The Alert summarizes the applicable SEC guidance and provides practical suggestions for using social media as a channel to disseminate information.
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