Apple's Disclosures Regarding Jobs' Health Remain Under Scrutiny by SEC

[MacRumors]

Bloomberg reports that the U.S. Securities and Exchange Commission is continuing to investigate Apple's disclosures regarding Steve Jobs' health during the early January period leading up to the announcement that Jobs would be taking a six-month medical leave of absence. The report is a follow-up to Bloomberg's January report about the investigation.

"The issue here is: Did Apple or Jobs make misleading disclosures, tested by what they knew at the time?" said Robert Hillman, a securities law professor at the University of California, Davis. "A disclosure could be misleading if it's a partial truth."

Whether the SEC will ultimately be able to take action against Apple or Jobs is unknown, given the uncertainty about the situation and the "murky" laws regarding disclosure of the health of companies' CEOs. Regardless of the extent to which a company has a duty to reveal health matters, it is clear that once a company chooses to speak about an issue, it must do so truthfully.

While there has to be some measure of confidentiality around the health of executives, any disclosures need to be accurate and complete, said Jahan Raissi, a former SEC enforcement attorney.

"Once you open your mouth and start to speak on a topic, you have to say something completely truthful," said Raissi, who is now a partner at Shartsis Friese LLP in San Francisco. "If what you omitted is material, that’s a problem."

On that basis, the SEC is focusing its inquiry on what events may have transpired between January 5th, when Jobs and Apple announced that he was suffering from a "hormone imbalance" for which the treatment was "relatively simple" and January 14th, when Jobs announced that he was taking a leave of absence due to the medical issue being "more complex" than originally thought.

Jobs' health issues ultimately required him to undergo a liver transplant, although he was still able to meet his stated timeline in returning to work by the end of June.

Article Link: Apple's Disclosures Regarding Jobs' Health Remain Under Scrutiny by SEC

 

[jav6454]

It's important to keep the investor communicated what happens health wise to its executives. However, due to the nature of fame (unluckily shall we say?) of the CEO, the issue of privacy arise.

Apple really has to find a middle on what information to release.

 

[NT1440]

Last I saw from apple, they said steve was on track to return in late June.

Well look at that, it happened. Hypothetical "he could have died if he was getting a transplant!" shouldn't matter seeing as they held true to their word. After going on medical leave I don't see a reason why anyone should be privy to his information. He came back when they said and is now heading the company as usual.

 

[DeathSticks]

Poor Steve

 

[Tenebrous]

Clearly the FEC has no bigger fish to fry than to spend time on a nine-day period of time some months ago, right? Right? Freakin' bureaucratic kleptomaniacs.

 

[nagromme]

I'm all for investigating to find OUT if something illegal was done, rather than just assuming either way. Apple should be held responsible if they've broken the law.

But some of the hollering seems to boil down to the premise that a patient's condition doesn't change over time, and that doctors don't do new tests or discover new information over time either.

But the fact is, doctors CAN determine something new--something they did not know a week (or an hour) before.

So if Apple makes one statement one week and an entirely new statement the following week, that's no more impossible than the DOCTOR making a new statement. Which happens all the time. The condition changes, or new test results come in, or whatever.

How much of those private records can be legally seized? I guess we'll find out.

 

[maclancer]

Apple should disclosure Jobs' Health from the beginning, now they are in hot waters with the government.

 

[NT1440]

I like how people care more about money than others personal privacy. THINK OF THE SHAREHOLDERS!

 

[MacCheetah3]

Hi
I still don't see the big deal, even for investors to know details of medical "issues". You're going to bail from any investments in the company if suddenly Steve comes down with cancer... Oh wait... It's fine if a company should divulge when a CEO 'steps out' for any kind of medical reason during a period but why really shouldn't be a big deal. Would you enjoy telling a ton of people about all of your medical issues? Apple's survived in Steve's absence before and they'll do it in the future.

 

[Pugpuppydude]

Dang.. I don't think he's going to be back. At least not like he was before, full time.

 

[Widowsoft]

Damm hope im not in trouble

I thought i had a cold which turned out to be hay fever sorry to those I said I had a cold

 

[pdjudd]

Clearly the FEC has no bigger fish to fry than to spend time on a nine-day period of time some months ago, right? Right? Freakin' bureaucratic kleptomaniacs.

If it involved any sort of fraudulent behavior that affects the way investors would handle stock from a company? Yes, the SEC has lots to say on that. If they feel that there is a legitimate complaint, it is their obligation to investigate.

Of course that being said, the chances of anything comming out of this is very nebulous at best. It isn't clear about how CEO's are required to disclose about their health - especially when they are on leave from the company. Plus consider the very volatile nature of the stock market and the stock of Apple has historically been. Finally throw in the fact that Jobs and his doctor are probably the only ones capable of knowing what really was going on during that 9 day period - very brief. Jobs' doctors are covered from disclosure by HIPPA unless Jobs releases them from that obligation.

This is a very nebulous affair that I feel that the SEC will abandon after they realize that they either don't have standing or there just isn't enough evidence to peruse much less prosecute on.

 

[iGary]

I like how people care more about money than others personal privacy. THINK OF THE SHAREHOLDERS!

He gives up some of his privacy as part of the position he is in. He can leave the company at any time if he doesn't like his health being in the limelight, so he did.

 

[windywoo]

I like how people care more about money than others personal privacy. THINK OF THE SHAREHOLDERS!

Personal privacy would be whether he likes boys or not. This is his health which affects business. And do you think Apple's motivation for not disclosing was to protect his privacy?

 

[zombitronic]

The SEC and Bloomberg can both go to hell. Why doesn't the SEC investigate Bloomberg for "accidentally" leaking Steve Jobs' obituary, causing a stock drop? With all the financial/economic corruption from Wall Street, journalists and Big Banks, why is the SEC so infatuated with Apple?

By the way, AAPL is up more than 60% since the announcement that Steve was going on medical leave. So who's upset here, other than the shorters?

 

[zombitronic]

Personal privacy would be whether he likes boys or not. This is his health which affects business. And do you think Apple's motivation for not disclosing was to protect his privacy?

In that case, I demand to know Steve Ballmer's blood pressure! That dude looks like he's about to pop a vein any second!

 

[NT1440]

He gives up some of his privacy as part of the position he is in. He can leave the company at any time if he doesn't like his health being in the limelight, so he did.

My gripe is that it shouldn't matter who the hell you are, things like privacy shouldn't fall victim to money matters like everything else does in this world with F$^#% up priorities, but alas, money is the only thing that matters.

Personal privacy would be whether he likes boys or not. This is his health which affects business. And do you think Apple's motivation for not disclosing was to protect his privacy?

If hes on medical leave, then no his health shouldn't affect business. The only reason it does is because stupid investors are putting their money in steve and not the company, that is not apples fault. I don't know apples motivation, I just think that its ******** that they should have to disclose anything short of Steve dying when he is on medical leave. Hes ill, hes gone for a few months for illness, why do any more details need to be released. Oh wait, I forgot, money. Nevermind then because as usual thats the thing that matters in the world.

 

[08Hawks]

Sec

Anyone heard of HIPA, this should apply to everyone !!!!!! Including Steve .....

Hey, don't we need a little bit more government control over our lives ????? (sarcasm) ....!!!!!!!

The SEC has not done there so called job for years with the large corporations unless they can benefit...... Now these morons want to control the live of the executives as well as the business's......

Sorry for the rant , just tired of our government getting involved in our lives and not allowing us to be grown ups and take care of ourselves.....

 

[FakeWozniak]

Hard to pay for this kind of advertising. Apple is in the headlines just about every day.

Wonder if the folks behind Psystar are the same folks whining to the SEC et. al....

 

[zombitronic]

...stupid investors are putting their money in steve and not the company, that is not apples fault.

You're right about that. My wife and I have a good amount of money invested in Apple, and it's not because of Steve Jobs. It's because we use Apple products, we study Apple products, we've used other products, and we understand the advantage Apple has over the competition. We have faith in Apple to not suddenly do a 180° and start churning out unpopular crap.

Does Steve matter? Of course he does. He's proven to be a good navigator for the company. But anyone who invests in Apple for Apple knows that there's a smart network of employees behind their success, and that's not going to go away unless somebody drops a bomb on Cupertino. Honestly, as an investor, I'd be more worried if something happened to Jonathan Ive.

 

[krye]

So what's the problem? Jobs is back in the house. The stock didn't tumble. The SEC needs to shut the f up and find some better way to spend their time and money.

 

[pavelbure]

i wonder how many of you that cry for the government to stay out of personal health matters are also crying for the government to take over health care.


as it stands, he is a ceo and the stockholders have a right to know if the man who is running a company will be out for awhile. some may not like the direction the others take the company.

 

[NT1440]

i wonder how many of you that cry for the government to stay out of personal health matters are also crying for the government to take over health care.

The two matters are separate even though you through them under the umbrella of "personal health matters."

 

[windywoo]

If hes on medical leave, then no his health shouldn't affect business. The only reason it does is because stupid investors are putting their money in steve and not the company, that is not apples fault. I don't know apples motivation, I just think that its ******** that they should have to disclose anything short of Steve dying when he is on medical leave. Hes ill, hes gone for a few months for illness, why do any more details need to be released. Oh wait, I forgot, money. Nevermind then because as usual thats the thing that matters in the world.

If his health is so severely at risk that he might die (as Steve Jobs was) then long term of course its going to affect business, whether he's currently on leave or not.

Maybe you're right that its unpleasant that money rules these decisions, but Apple are certainly no saints, their motivation for withholding the information would almost certainly be money.

 

[benpatient]

Steve Jobs, and Apple in general, have profited greatly from his "celebrity" and they have to accept everything that comes with it. If you don't want CEO health/wellbeing to be a marketing/investment consideration, then you have two choices: takes steps to avoid creating an air of celebrity around the CEO, or take the company private and get out from under SEC observation.

If Steve Jobs came to a press conference and said on record that Windows 7 is better than Snow Leopard, Apple's stock would tank.

What I mean by that is that Steve Jobs can (and does) have a bigger effect on Apple's stock value than any other single person. Apple takes advantage of this fact again and again. They have to be willing to accept the converse.