Regulation FD ‐ What the SEC’s recent enforcement actions teach about avoiding liability

Recent SEC actions, including its first settlement of an enforcement case, provide specific guidance and some surprising points of emphasis concerning the implementation of Regulation FD (Fair Disclosure). Although there is nothing inherently unlawful about one‐on‐one meetings with securities analysts or institutional investors, the SEC’s actions demonstrate the risks associated with one‐on‐one meetings, particularly with sell‐side analysts for public companies and potentially for the analysts themselves. Executives and analysts alike could benefit from consulting with counsel about the best ways to perform the valuable function of discussing a company’s business without violating Regulation FD. Several measures should be considered, including, among others, a review of prior filings, education about what types of information is normally considered material, and a predetermined view about areas that will be “out of bounds” to questions.