Five questions answered on Netflix's Facebook "violation"

Digested.

Netflix Inc’s chief executive Reed Hastings is in trouble with the US Securities and Exchange Commission (SEC) because of something he posted on Facebook. We answer five questions on his controversial post.

What did Hastings say?

On 3 July Hastings announced on a public Netflicks Facebook page accessible to 244,000 subscribers that one billion hours of video was being viewed a month by members of the video streaming website. 

He said exactly: "Netflix monthly viewing exceeded 1 billion hours for the first time ever in June."

So, what’s the problem with this post exactly?

The way the information was disclosed is the problem. The SEC believes that this particular figure is material information and therefore should have been disclosed in a press release or regulatory filing.

SEC's Regulation FD, adopted in 2000, requires public companies to make full and fair public disclosure of material non-public information.

What kind of action is the SEC taking?

The "Wells notice," as it is known as, that was received by Netflicks and filed by the company as regulations dictate, states that the SEC is planning on bringing civil action against the company because of the post made by Hastings.

The SEC staff will recommend the full commission pursue either a cease-and-desist action and/ or civil injunction against Netflix and Hastings.

What has Hasting said about his contentious Facebook posting?

According to The Telegraph, Hasting said yesterday that his posting was public enough: "First, we think posting to over 200,000 people is very public, especially because many of my subscribers are reporters and bloggers," 

In a letter posted alongside the regulatory filing he added "We remain optimistic this can be cleared up quickly through the SEC's review process." 

What are other people saying?

Wedbush Securities analyst Michael Pachter told Reuters: "It's totally disingenuous to say that his statement wasn't material when the stock went from under $70 a share to more than $80 and the only data point was that post."

While, Joseph Grundfest, former SEC commissioner and Stanford Law School professor also told Reuters: "The evolution of social media presents the SEC with some very interesting regulatory challenges. But if they're worried about social media, there are ways for them to address that without threatening to sue Reed Hastings. They should have a rulemaking where they can ventilate these issues. "

Netflix is in trouble. Photograph: Getty Images

Heidi Vella is a features writer for Nridigital.com

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Could Jeremy Corbyn still be excluded from the leadership race? The High Court will rule today

Labour donor Michael Foster has applied for a judgement. 

If you thought Labour's National Executive Committee's decision to let Jeremy Corbyn automatically run again for leader was the end of it, think again. 

Today, the High Court will decide whether the NEC made the right judgement - or if Corbyn should have been forced to seek nominations from 51 MPs, which would effectively block him from the ballot.

The legal challenge is brought by Michael Foster, a Labour donor and former parliamentary candidate. Corbyn is listed as one of the defendants.

Before the NEC decision, both Corbyn's team and the rebel MPs sought legal advice.

Foster has maintained he is simply seeking the views of experts. 

Nevertheless, he has clashed with Corbyn before. He heckled the Labour leader, whose party has been racked with anti-Semitism scandals, at a Labour Friends of Israel event in September 2015, where he demanded: "Say the word Israel."

But should the judge decide in favour of Foster, would the Labour leadership challenge really be over?

Dr Peter Catterall, a reader in history at Westminster University and a specialist in opposition studies, doesn't think so. He said: "The Labour party is a private institution, so unless they are actually breaking the law, it seems to me it is about how you interpret the rules of the party."

Corbyn's bid to be personally mentioned on the ballot paper was a smart move, he said, and the High Court's decision is unlikely to heal wounds.

 "You have to ask yourself, what is the point of doing this? What does success look like?" he said. "Will it simply reinforce the idea that Mr Corbyn is being made a martyr by people who are out to get him?"