John Schoeler of Q4 Web Systems, which handles investor relations for companies, writes about the recent New York court decision allowing financial news site Seeking Alpha to keep the name of one of its writers anonymous.
Schoeler writes, “NNVC felt the same way, sending out a press release on February 14 addressing the article. The company echoed what many had already suggested on Seeking Alpha, that the author was purposely trying to manipulate the stock price for their own gain and that their claims about the company, it’s technology and management were without grounds. In the release, they also stated that they had filed a request with Seeking Alpha to remove the post and to disclose the true identity of the author.
“NNVC made good on their claim and did in fact make an official request to Seeking Alpha. Seeking Alpha, in turn, restated their stance on allowing their contributors the opportunity to use pseudonyms in order to protect their identity. This lead to NNVC filing an official petition with the New York Supreme Court requesting that Seeking Alpha reveal the identity of Pump Terminator. Followers of the case fell on two sides of the fence. Those in favour of Seeking Alpha’s policy claimed they were in favour of free of speech and that allowing authors to use pseudonyms is what drew many contributors to the community and allowed those contributors to write about issues that they felt were important without risking their job or getting threatened with legal action. Those siding with NNVC saw a company that had a strong liable case against the author but were not able to clear their name. Seeking Alpha appeared to be protecting someone who was only contributing to the site for their own financial gain and taking advantage of community policies to avoid any repercussions.
“As stated at the top of the post, it was announced that Seeking Alpha would not have to give up the identity of Pump Terminator. Seeking Alpha and it’s supporters are touting this as a substantial victory for their community. For other public companies watching along, the ruling means more potential obstacles they will have to manoeuvre in order to maintain investor confidence. Not being able to take anonymous contributors to task makes it difficult to dismiss their claims in the eyes of investors. Companies are going to have to look at this ruling and re-evaluate how they handle this kind of online commentary.”
Read more here.
