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O’Melveny’s Herron, Heyduk Comment on SEC’s New Guidance on Social Media Disclosure in Inside Investor Relations

May 23, 2013

O’Melveny & Myers LLP partner Jay Herron and counsel Shelly Heyduk commented on the SEC’s new guidance on social media disclosure for the May 23, 2013, Inside Investor Relations article “Disclosure buzz: thoughts on the SEC's social media rules.” The article gathers reactions from a variety of perspectives to the SEC’s statement in April that companies are permitted to use social media to publish material information as long as they let investors know in advance which channels they intend to use.

Providing a lawyer's perspective, Herron and Heyduk noted that companies should be thoughtful in how they implement the SEC’s guidance. They suggest that while alerting investors is now clearly a prerequisite to Reg FD compliance, companies should also consider other factors mentioned in the commission’s 2008 release addressing the use of company websites to assess whether any particular social media channel on its own is adequate for the dissemination of material information. In addition, they recommend that to ensure important information will reach all investors efficiently, companies should consider identifying and using separate company blogs or Facebook or Twitter accounts that are dedicated exclusively to investor communications.

Herron is a member of O’Melveny’s Mergers and Acquisitions Practice, and Heyduk is a member of the Capital Markets Practice. Both lawyers reside in the Firm’s Newport Beach office.