How Much Privacy Should Steve Jobs Get?

Despite Job's request for privacy, some say investors are owed more information.

January 18, 2011, 12:48 PM

Jan. 18, 2011— -- Announcing his medical leave Monday, the man who gave the world the iPhone, the iPad and the iPod a host of other technological wonders, asked for privacy.

Should he get it?

In a company-wide e-mail Monday, Apple CEO Steve Jobs told staff members that he was taking his second medical leave of absence in two years for an indefinite period of time, for an undisclosed medical condition.

"I love Apple so much and hope to be back as soon as I can. In the meantime, my family and I would deeply appreciate respect for our privacy," Jobs wrote.

If Jobs were the average person battling an illness, granting his request would likely be a given. But as CEO of one of the country's most valuable companies -- and an iconic one at that -- Jobs is hardly the average person, and his announcement has renewed a debate over how much privacy he actually deserves.

Though some agree that the ailing CEO has a right to be tight-lipped, others argue that because Jobs' health is so closely tied to the health of his company, investors have the right to more information.

In an op-ed piece in The Atlantic, Ben Heineman Jr., a senior fellow at Harvard Law School's Program on Corporate Governance, wrote, "Everyone wishes Jobs a full and speedy recover. But, given Jobs' powerful position, we should know from what."

Securities laws require companies to disclose material information about the company. And, especially considering Jobs' medical history and the drop in stock price that accompanied the latest announcement, he said, "his current illness is surely material -- surely would affect an investor's decision to buy or sell securities."

The announcement of Jobs' most recent leave caused Apple's stock to drop 8 percent in international trading Monday, and the stock fell 2 percent when U.S. markets opened today after Monday's holiday.

But despite that correlation, not everyone agrees that he's obligated to offer more details.

Kara Swisher, a long-time technology reporter and co-editor of the Wall Street Journal's All Things Digital blog, said Wall Street and the media know enough.

"Steve Jobs asks for privacy -- and he deserves it this time," Swisher wrote.

Not only does the public know about Jobs' bout with pancreatic cancer and his recent liver transplant, she said, "Steve Jobs has given his large audience more than enough since he got back after the last time he was sick."

'Fake Steve Jobs' Defends the Real CEO

Even Dan Lyons, the Newsweek reporter who has spent much of his career impersonating the Apple CEO with his "Fake Steve Jobs" blog, decided to retire his blog in a nod to the tech visionary.

"In my final Fake Steve post I urged my fellow 'filthy hacks' (Fake Steve's affectionate term for journalists) to leave Steve alone," he wrote in a Daily Beast post explaining his decision.

Analysts acknowledge that while investors might like more information, Apple is under no obligation to hand over anything else.

"As far as investors are concerned and analysts are concerned, this is not enough disclosure," said Gene Munster, an analyst with Piper Jaffray. But "legally, Apple's done all that they need to do. ….Everyone wants more but the reality is we're not going to get anything more."

Peter Henning, a former SEC lawyer and professor at the Wayne State University of Law, said that while companies are required to share material information about a company (or information that a reasonable investor would consider important), there's nothing in securities laws that require companies to specifically disclose information about a CEO's health.

"It's a delicate balance," he said. "Do investors have a right to know what [Jobs'] prognosis is? The answer to that one, I really think, is no."

Henning said the wording and timing of the announcement might actually mean that Apple has learned from previous lessons -- specifically, a reported 2009 Securities and Exchange Commission investigation into Apple's disclosure's of Job's health.

When contacted by, an SEC spokesman declined to comment on the matter.

Henning said it's likely that nothing will come of the probe, but he added that it might have taught Apple that it's better to tackle such matters sooner than later.

"[Apple] learned… Get it out there, keep it simple and move on," he said. "Apple handled this as well as you can handle it."

Should SEC Should Give More Guidance on CEO Health?

Still, some academics argue that Apple -- and other companies facing similar situations -- should be obligated to share more information with their stakeholders.

"I think it falls in line with the general push toward transparency and accountability and everything that Sarbanes-Oxley and the SEC itself stand for," said Alexa Perryman, a professor at Texas Christian University's Neeley School of Business and co-author of the paper "When the CEO is Ill: Keeping Quiet or Going Public?" "It's very important that the board of directors and the CEO himself or herself realize that they have a bit of celebrity role, a bit of a public persona."

Apple's board has always argued that Jobs' health is not material information, but Perryman said, "Given the repetition and given the fact that there are those stock drops, it's getting harder and harder to say that."

Apple may be well within its legal limits by withholding information about Jobs' health but, in general, she said corporate boards need more SEC input when it comes to CEO health disclosures.

"Right now, it's up to each board of directors to make this call, but given that health has so many personal issues, HIPAA [issues], I think boards are going to need some guidance from the SEC to help them with these tricky decisions," she said.

Despite the shadow of Jobs' departure hanging over the company, in its first quarter earnings call with analysts today, Apple executives were optimistic about the future of the company. Apple's earnings report was much stronger than expected, with the company posting record quarterly profits of $6 billion for the last three months of 2010 and reporting a 78 percent jump in net income for the holiday quarter.

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