In a recent YouTube interview, Palihapitiya asserted that in the case of a traditional IPO “you can’t show a [financial] forecast and you can’t talk about the future of how you want to do things — you’re just not allowed.” While public companies are protected from lawsuits involving forward-looking statements through a safe-harbor law passed by Congress in 1995, it doesn’t apply to companies that are in the process of going public.
“Because the SPAC is a merger of companies, you’re all of a sudden allowed to talk about the future,” Palihapitiya added. “When you do that, you have a better chance of being more fully valued.”
Coates warned that this advice could be misleading, noting that the safe-harbor provision doesn’t protect any company from enforcement actions brought by the SEC, but only from private litigation. Furthermore, the law doesn’t protect companies that make false or misleading statements, such as giving an incomplete set of projections of company performance.
Source: SEC’s Coates tells investors to ignore billionaire SPAC investor’s legal advice – MarketWatch