Beginning Next Week: InsideCounsel will become part of Corporate Counsel. Bringing these two industry-leading websites together will now give you comprehensive coverage of the full spectrum of issues affecting today's General Counsel at companies of all sizes. You will continue to receive expert analysis on key issues including corporate litigation, labor developments, tech initiatives and intellectual property, as well as Women, Influence & Power in Law (WIPL) professional development content. Plus we'll be serving all ALM legal publications from one interconnected platform, powered by, giving you easy access to additional relevant content from other InsideCounsel sister publications.

To prevent a disruption in service, you will be automatically redirected to the new site next week. Thank you for being a valued InsideCounsel reader!


SEC charges former VP in fair disclosure rules violations

Former First Solar VP let select investors know the company would receive less government money than expected

Here’s a hint for future VPs: if you’re going to say publicly that your company is getting $4.5 billion from the government, then you better make sure it comes through. And if it doesn’t come through, tipping off select investors while leaving others in the dark is an easy way to have the SEC on your back.

Lawrence Polizzotto, a former vice president at Arizona-based First Solar Inc., is learning this lesson the hard way. On Friday, the SEC charged Polizzotto with violating fair disclosure rules, claiming he illegally tipped off investors about the status of key government contracts.

At an investor conference on Sept. 13, 2011, First Solar’s then-CEO expressed confidence that the company would receive three loan guarantees from the government, totaling $4.5 billion. However, two days later, several executives including Polizzotto learned they would not be receiving at least one of the guarantees.

First Solar counsel advised company executives of Fair Disclosure rules, which state that the company would not be able to answer any questions from interested parties until First Solar issued a press release. But according to the SEC's order, “Polizzotto violated Regulation FD during one-on-one phone conversations with approximately 20 sell-side analysts and institutional investors on Sept. 21, 2011,” before the company made its guarantee status known.

“Polizzotto offered previously undisclosed information to select analysts and institutional investors and left the rest of First Solar’s investors in the dark,” said Michele Wein Layne, director of the SEC’s Los Angeles Office. “All investors, regardless of their size or relationship with the company, are entitled to the same information at the same time.”

First Solar issued its press release detailing the material information the next morning after Polizzotto’s phone conversations. The company’s stock subsequently fell 6 percent.

Polizzotto has agreed to pay $50,000 to settle the SEC’s charges.

Assistant Editor

author image

Zach Warren

Zach Warren is Assistant Editor of InsideCounsel magazine, where he oversees online content submissions and administers InsideCounsel's enewsletters. Zach specializes in new media and multimedia...

Bio and more articles

Join the Conversation

Advertisement. Closing in 15 seconds.