Jim Clark, the founder of Web browser Netscape, has resigned as chairman of Redwood City photo printing company Shutterfly, citing securities regulations that have “gone too far.”
Clark held about 30 percent of the company’s shares when it went public in September, but Shutterfly’s technology has matured, and he’d been constrained by Sarbanes-Oxley securities law, he said, citing the reasons why he resigned:
“Sarbox (Sarbanes-Oxley) dictates that I not chair any committee due to the size of my holdings, not be on the compensation committee because of the loan I once made to the company, not be on the governance committee,” Clark wrote in a letter to Shutterfly executives.
“It even dictates that some other board member must carry out the perfunctory duties of the chairman,” he wrote in a letter dated Jan. 1. “What’s left is liability and constraints on stock transactions, neither of which excite me.”
9 Comments
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Harshal Vaidya said:
Its time such companies move to India. All such regulatory headaches aren’t present out there.
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Blake said:
This is straight out of Ayn Rand’s *Atlas Shrugged*, in which the businessmen who hold up the economy go on strike.
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James Naughton said:
I think there is lots more of this to come.
Sarbanes Oxley is more a curse. Contrary to what regulators and accountancy firms might say it is NOT a panacea or is not the silver bullet of corporate governance.
I hope the SEC and PCAOB take a serious look at this now ridiculous situation as it will never prevent another Enron.
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krish said:
Over regulation can only impede economic creativity. Offenders will still be around no matter how severe a punishment law provides. The old dictum of “Caveat Emptor” ( buyers beware) still holds true and is the only reliable safeguard.
Sox Act at best enriches and nourishes Accountants and corporate lawyers - the parasite that thrives in the cesspool of economic malaise.
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BlogReader said:
Yeah right he quit because he can’t be the head of some internal committee. Could it be that a website that just prints pictures and mails them to people isn’t that interesting? He’s cashing out and moving on to something more exciting — this “oh the SOX is teh evil” is just a smokescreen, probably because it makes shady inside trading harder to do.
As for the Atlas Shrugged reference: you’re actually equating nationalizating a steel company with asking that a public photo printing site be more open with its books? -
vv said:
why don’t enterpreneurs like Jim who created the bubble in the first place suggest a balance between no regulation and SO. SO might well be an over-reaction, but to throw a tantrum (given the extent of capital loss they caused) seems irresponsible.
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Drake McHugh said:
Go Dark! Go Private!
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