Google Bares Little in Playboy Spread

Updated from 12:13 p.m.

Google's unorthodox initial public offering unveiled another surprise Friday: The risk posed by Playboy magazine.

In an amended IPO prospectus filed Friday morning -- the same day that bidding opened in Google's long-awaited auction of its shares -- Google warned that a newly published Playboy interview with the company's two founders could have expensive consequences.

Specifically, Google warns that if a court finds that the September Playboy interview constitutes a securities law violation, "we could be required to repurchase the shares sold to purchasers in this offering at the original purchase price for a period of one year following the date of the violation."

Google says it doesn't believe that the interview with co-founders Larry Page and Sergey Brin violates securities laws. The company, which reprinted the interview in an appendix to the latest filing, says, "We would contest vigorously any claim that a violation of the Securities Act occurred."

At issue is the so-called quiet period surrounding IPOs, in which companies are expected to limit extraordinary communications to the public to material that is in their IPO filings.

In the past, violating "quiet period" rules has forced companies to delay their IPOs. Earlier this year, for example, customer relationship management firm salesforce.com (CRM) delayed its IPO after the company's talkative CEO, Marc Benioff, spoke of the company's prospects in an article in The New York Times.

Back in 1999, now-defunct-grocer Webvan delayed its IPO after TheStreet.com reported that the company was disclosing important details about its business to institutional investors that it wasn't including in public filings.

On Friday, citing a person familiar with the matter, The Wall Street Journal reported that regulators are expected to let the Google offering proceed apace.

In its disclosure about the interview -- which Google says took place in April, before the company first filed to go public -- the company advises investors to place the interview and the accompanying article in a larger context. "The article presented certain statements about our company in isolation and did not disclose many of the related risks and uncertainties described in this prospectus," says Google. "As a result, the article should not be considered in isolation and you should make your investment decision only after reading this entire prospectus carefully."