Post by ginger on Feb 25, 2006 20:47:39 GMT -4
news.yahoo.com/s/ap/20060225/ap_on_go_ot/sec_columnists
WASHINGTON - The Securities and Exchange Commission routinely subpoenas companies and financial market figures. Rarely does it go after journalists' records, yet it sought recently to compel two reporters to turn over material.
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The legal move comes at a time of heightened sensitivity over press freedom and government action against journalists.
After issuing a subpoena on Feb. 7 to two financial journalists, the SEC decided last week against compelling them, at least for now, to surrender records as part of an investigation into allegations of stock manipulation.
The subpoena went to columnists for two Dow Jones & Co. publications, Herb Greenberg of MarketWatch and Carol Remond of Dow Jones Newswires. The subpoena sought telephone records, e-mails and other documents related to the online retailer Overstock.com. Greenberg and Remond have written columns about Overstock.
The independent market watchdog agency, which only has civil powers, rarely subpoenas journalists or news organizations. Its move comes during a period in which — most notably in high-profile criminal cases — authorities increasingly are compelling journalists to produce information and disclose their sources.
"It's an epidemic," Lucy Dalglish, executive director of the Reporters Committee for Freedom of the Press, said Saturday. "I think we may see more and more agencies" moving to subpoena journalists.
SEC spokesman John Nester said that under long-standing practice, the agency "generally subpoenas journalists only when absolutely necessary and after careful thought and consideration." He declined further comment.
The SEC is investigating allegations by Overstock that a research firm, Gradient Analytics, issued negative reports on the retailer in exchange for payments from a hedge fund seeking to profit from a drop in its stock price. Overstock has sued Gradient and the hedge fund in question, Rocker Partners; they deny any wrongdoing.
The SEC move prompted Greenberg to disclose and sharply criticize the subpoena in a column published Friday.
Greenberg, who has written columns critical of Overstock and its chief executive, Patrick Byrne, wrote that "if my unpublished communications aren't safe from government eyes, then the tools of every business reporter in this country become fair game for any company that doesn't like scrutiny and chooses to play the 'conspiracy' card."
Greenberg said that he and Dow Jones — which also publishes The Wall Street Journal — had objected to the subpoena.
SEC lawyers in the agency's San Francisco office are conducting the Overstock investigation. They told Dow Jones on Friday that although the company had not complied with the subpoena by that day's deadline, they were not going to court to seek to enforce it — at least for now.
The agency often tries to negotiate with companies or individuals under subpoena before resorting to court action because sensitive material related to the investigation may have to be introduced to make their case. Sometimes agency investigators are able to obtain the information they seek from other sources.
Dow Jones spokeswoman Amy Wolfcale said in a statement that the SEC had not taken the subpoena off the table and "may come back in the future."
WASHINGTON - The Securities and Exchange Commission routinely subpoenas companies and financial market figures. Rarely does it go after journalists' records, yet it sought recently to compel two reporters to turn over material.
ADVERTISEMENT
The legal move comes at a time of heightened sensitivity over press freedom and government action against journalists.
After issuing a subpoena on Feb. 7 to two financial journalists, the SEC decided last week against compelling them, at least for now, to surrender records as part of an investigation into allegations of stock manipulation.
The subpoena went to columnists for two Dow Jones & Co. publications, Herb Greenberg of MarketWatch and Carol Remond of Dow Jones Newswires. The subpoena sought telephone records, e-mails and other documents related to the online retailer Overstock.com. Greenberg and Remond have written columns about Overstock.
The independent market watchdog agency, which only has civil powers, rarely subpoenas journalists or news organizations. Its move comes during a period in which — most notably in high-profile criminal cases — authorities increasingly are compelling journalists to produce information and disclose their sources.
"It's an epidemic," Lucy Dalglish, executive director of the Reporters Committee for Freedom of the Press, said Saturday. "I think we may see more and more agencies" moving to subpoena journalists.
SEC spokesman John Nester said that under long-standing practice, the agency "generally subpoenas journalists only when absolutely necessary and after careful thought and consideration." He declined further comment.
The SEC is investigating allegations by Overstock that a research firm, Gradient Analytics, issued negative reports on the retailer in exchange for payments from a hedge fund seeking to profit from a drop in its stock price. Overstock has sued Gradient and the hedge fund in question, Rocker Partners; they deny any wrongdoing.
The SEC move prompted Greenberg to disclose and sharply criticize the subpoena in a column published Friday.
Greenberg, who has written columns critical of Overstock and its chief executive, Patrick Byrne, wrote that "if my unpublished communications aren't safe from government eyes, then the tools of every business reporter in this country become fair game for any company that doesn't like scrutiny and chooses to play the 'conspiracy' card."
Greenberg said that he and Dow Jones — which also publishes The Wall Street Journal — had objected to the subpoena.
SEC lawyers in the agency's San Francisco office are conducting the Overstock investigation. They told Dow Jones on Friday that although the company had not complied with the subpoena by that day's deadline, they were not going to court to seek to enforce it — at least for now.
The agency often tries to negotiate with companies or individuals under subpoena before resorting to court action because sensitive material related to the investigation may have to be introduced to make their case. Sometimes agency investigators are able to obtain the information they seek from other sources.
Dow Jones spokeswoman Amy Wolfcale said in a statement that the SEC had not taken the subpoena off the table and "may come back in the future."
