Fwd: [Clips] Re: [CYBERIA] Pres. Orders and Securities Act liability (strongly verging OT)

[coderman]

thanks RAH, you save me much resource discovery time.

exposed shareholders indeed.

---------- Forwarded message ----------
From: R.A. Hettinga <rah at shipwright.com>
Date: May 17, 2006 6:36 PM
Subject: [Clips] Re: [CYBERIA] Pres. Orders and Securities Act
liability (strongly verging OT)
To: Philodox Clips List <clips at philodox.com>



--- begin forwarded text


  Delivered-To: rah at shipwright.com
  Thread-Topic: Pres. Orders and Securities Act liability (strongly verging OT)
  Thread-Index: AcZ6A/JBF/buiOcZTWGMnGJvY6GkYQAFYwFF
  Priority: normal
  Date:         Wed, 17 May 2006 21:22:13 -0400
  Reply-To: Law & Policy of Computer Communications
<CYBERIA-L at LISTSERV.AOL.COM>
  Sender: Law & Policy of Computer Communications <CYBERIA-L at LISTSERV.AOL.COM>
  From: Chris Savage <chris.savage at CRBLAW.COM>
  Subject: Re: [CYBERIA] Pres. Orders and Securities Act liability
(strongly verging OT)
  To: CYBERIA-L at LISTSERV.AOL.COM

  ________________________________

  From: Law & Policy of Computer Communications on behalf of Ethan Ackerman
  Sent: Wed 5/17/2006 6:29 PM
  To: CYBERIA-L at LISTSERV.AOL.COM
  Subject: Re: Pres. Orders and Securities Act liability (strongly verging OT)

  <snip>

  >>>>Second, I'm thinking that there's a problem here regarding
consistency.  If I have a material expenditure or liability (or, I suppose,
revenue or income or investment) that may appropriately be kept secret
under Section 78m(b)(3), then doesn't it follow logically that I will also
exclude it from the financials I file with my 10Ks and 8Ks, etc.?
Otherwise there will be a material mismatch between two publicly filed
financial statements by the same company for the same period.<<<<

  >>-The exemption covers those documents too.  Section 78m(b)(3) excuses
non-compliance only with Section 78m(b)(2) - BUT that is itself the
statutory authority for MOST of the SEC-required filings - including 10-Ks,
10-Qs, annual reports, Sarbanes-Oxley certification requirements, etc.  --
I should have made that more clear.  Most all of the '34 Act (which covers
publicly traded companies) rules are from 17 CFR Part 240 - and 78m(b)2 is
the authority for most of those rules.<<

  So: Bottom line: If AT&T (or Verizon) got paid $1 billion from the spooks
to do something, but got the right directive, they could simply not
disclose that revenue on any SEC filing.  Or, if they did something that
exposed them to liability -- like violating relevant customer privacy
requirements, and their normal obligation would be to disclose the
liability and make a reserve for it, they just don't have to.

  If that's right, at the moment it seems to me that the shareholders of
those companies are awfully exposed, aren't they....?

  Chris S.

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--
-----------------
R. A. Hettinga <mailto: rah at ibuc.com>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'
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