Netflix Gets SEC Notice over CEO's Facebook Post
December 7, 2012 (washingtonpost.com) NEW YORK - Netflix is facing scrutiny from government regulators for a Facebook post by its chief executive in July that may have helped boost the online video company's stock price.
Netflix said Thursday the Securities and Exchange Commission told it that its staff is recommending civil action be brought against the company and chief executive Reed Hastings. The reason: Hastings's July 3 post, in which he said Netflix's online video viewing "exceeded 1 billion hours for the first time ever in June."
The SEC said posting on Facebook doesn't amount to fair public disclosure of information that is material to investors.
Shares in Netflix rose more than 6 percent on the day of that post. On the first day of trading after the July 4th holiday, its shares rose 13 percent.
Hastings used Facebook on Thursday to comment on the investigation, saying that because he had 200,000 followers at the time, the information was widely disseminated.