SEC Is Upset Over Netflix CEO's Facebook Post

It seems like just about everyone is on Facebook today. Not only are most of your friends on Facebook, but many CEOs of some the biggest companies in the technology world also routinely use Facebook to give out details. This is exactly what Netflix CEO Reed Hastings did last summer when he gave up some interesting details on Netflix via his Facebook account.

I would imagine most people didn't think anything about Hastings and his Facebook post, but the SEC has taken issue with it. The SEC sent Reed Hastings a Wells notice. A Wells notice is something the SEC sends to give a company notification that it's likely to bring some sort of action against the firm.

The hubbub stems from a Facebook post that Hastings made in July when he posted the Netflix users had streamed 1 billion hours of content in June for the first time ever. Not only was that an interesting milestone for the company, but it was big news for shareholders and Netflix's stock price jumped 6% after the post.

The SEC believes that the number of streaming hours was material information that should have been more formally announced. Hastings has 200,000 subscribers to his Facebook page and says that since he told all 200,000 people, it was a formal announcement and a press release wasn't required. Hastings also notes that the company had already disclosed in investor letters that it was closing in on 1 billion hours of streaming so the Facebook post wasn't news. There is no indication at this time of what action, if any, the SEC will take in this case.

[via Business Insider]