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Jun 24, 2013

Icahn Tweets, and Tells the SEC

It took 266 characters -- if you don't count the headings and other preface matter -- for businessman Carl Icahn to inform the Securities and Exchange Commission that had sent his first tweet, which had only 58 characters.

Icahn filed a notice of his tweet, because it mentioned Dell, Inc., over which Icahn is in a bidding war with company founder Michael Dell. “Twitter is great," Icahn said in his premiere tweet. "I like it almost as much as I like Dell.”


The body of the notice said, in full:
On June 20, 2013, Carl C. Icahn created a Twitter account under the Twitter handle @Carl_C_Icahn (https://twitter.com/Carl_C_Icahn). On June 20, 2013, Mr. Icahn sent the following Tweet relating to Dell Inc.:“Twitter is great. I like it almost as much as I like Dell.”


Icahan apparently filed the notice to comply with the Commission's fair disclosure provision, Regulation FD (17 CFR 243.100-243.103), which requires that any "market moving information" must be disclosed to all investors simultaneously.

Earlier this year, the SEC issued a report (summary) clarifying that public companies can fulfill public disclosure requirements via social media, as long as investors are made aware of the website(s), including social media feeds, where the information is available. The report stemmed from a SEC investigation of Netflix chief executive officer Reed Hastings' use of his personal Facebook page to announce that the company had streamed one billion hours of content in the month of June 2012.

In general, the SEC report concluded that "disclosure of material, nonpublic information on the personal social media site of an individual corporate officer, without advance notice to investors that the site may be used for this purpose, is unlikely to qualify as a method 'reasonably designed to provide broad, non-exclusionary distribution of the information to the public' within the meaning of Regulation FD."

While Icahan's interest in acquiring Dell has received substantial attention, filing the SEC notice insures that he will not run afoul of the SEC rule.


(Hat tip: Law360; Austin Business Journal)

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