Was Disclosure Unfair?The decision not long ago by Emulex Corp. to broadcast bad news via a Webcast is not one other companies may want to emulate. Nothing wrong with a Webcast, of course -- but the California-based networking equipment maker appeared to contravene con·tra·vene tr.v. con·tra·vened, con·tra·ven·ing, con·tra·venes 1. To act or be counter to; violate: contravene a direct order. 2. the Securities and Exchange Commission's recent Regulation FD ("fair disclosure") rules by not issuing a press release first, covering an announcement about disappointing sales. Instead, it sent a brief release, not detailing the news, that directed investors to its Web site, where CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Paul Folino was to address a technology conference a few days later. In doing so, Emulex appeared to be violating Reg FD rules stipulating that "material" disclosures be issued broadly before being given to a select audience. But a former SEC attorney told The Wall Street Journal that there may be some latitude latitude, angular distance of any point on the surface of the earth north or south of the equator. The equator is latitude 0°, and the North Pole and South Pole are latitudes 90°N and 90°S, respectively. in the code, and that a news release directing investors to a Webcast may be acceptable. Emulex argued that the news wasn't a matter of lowering earnings guidance, but "a change in tone." Still, analysts and investors made it clear they disapproved, and Emulex officials said afterward af·ter·ward also af·ter·wards adv. At a later time; subsequently. Adv. 1. afterward - happening at a time subsequent to a reference time; "he apologized subsequently"; "he's going to the store but he'll be back here that, in hindsight hind·sight n. 1. Perception of the significance and nature of events after they have occurred. 2. The rear sight of a firearm. , they would have handled the release differently. |
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