Whole Foods Less than Scrupulous CEO Blasted in NY Times

http://www.nytimes.com/2007/07/12/busin ... ei=5087%0A

http://www.chicagotribune.com/business/ ... zfront-hed[/url] [/url]

I'm not sure what the big deal is:

1. He didn't reveal any inside information about Whole Food.

2. He didn't reveal any inside information about Wild Oats.

3. A number of other people guessed who he was a long time ago, even though this only made the news now.

4. He revealed who he was last August, even though this only made the news now.

5. He did not write anything factually incorrect (as far as I know, according to the news reports).

6. He has a right to post his opinions anonymously, just as we all do on this forum.

7. His posts have no effect whatsoever on the stock price of either company.

Certainly the readers of Yahoo Finance boards would have preferred to know his identity, just as I'd like to know if a negative post about a restaurant on LTH Forum was actually written by the owner of a rival restaurant (or whether a glowing review of a book was written by its author). The forum is better if these kinds of things don't happen. But we shouldn't pretend this is some corporate scandal when it really isn't.

Darren72 wrote:I'm not sure what the big deal is:

7. His posts have no effect whatsoever on the stock price of either company.

I was with you up until point 7. Although I don't think his intention was to manipulate the stock price of either company, I don't think you can say postings on a Yahoo Finance message board don't have any effects.

Yahoo Finance has been used many times in the past as part of pump-and-dump schemes. This is the opposite situation - Mackey stood to personally and professionally benefit if OATS stock price dropped, since it made it a more attractive target for acquisition.

I was with you up until point 7. Although I don't think his intention was to manipulate the stock price of either company, I don't think you can say postings on a Yahoo Finance message board don't have any effects.

Yahoo Finance has been used many times in the past as part of pump-and-dump schemes. This is the opposite situation - Mackey stood to personally and professionally benefit if OATS stock price dropped, since it made it a more attractive target for acquisition.

Point taken. What I meant was that his postings will have no long term effect on the stock price.

Exposure of his postings might have a long term effect on WFMI's price Short term, at least, they're down nearly 2.5% today.

I read this online today and my first thought was what a pompous asshole to think he could blather away with impunity on stock tip boards using a phony handle (not that the Yahoo stock boards are worth anything more than the proverbial grain of salt.) Anyone know if this kosher according to the SEC -- doesn't seem so to me.
>>Brent

We have another thread about this. See http://www.lthforum.com/bb/viewtopic.php?t=14327

He didn't do anything illegal. The SEC certainly won't be involved in this.

Darren72 wrote:We have another thread about this. See http://www.lthforum.com/bb/viewtopic.php?t=14327

He didn't do anything illegal. The SEC certainly won't be involved in this.

fyi: this thread predates the other one(check the timecode)

Christopher Gordon wrote:

Darren72 wrote:We have another thread about this. See http://www.lthforum.com/bb/viewtopic.php?t=14327

He didn't do anything illegal. The SEC certainly won't be involved in this.

fyi: this thread predates the other one(check the timecode)

These two threads should be merged. Until then, perhaps the readers of this thread may be interested in reading the thoughts on the other thread.

Illegal or not, any executive with two brain cells to rub together should have enough sense not to put himself or his company in such a position by doing something stupid like that.

I predict Wild Oats ends up buying Whole Foods in a year.

Sundaysous wrote:I predict Wild Oats ends up buying Whole Foods in a year.

Actually, didn't Whole Foods just buy out a bunch of Wild Oats locations? That's part of why this all has come to a head-- the FTC wants to make sure WF won't be "monopolizing" the organic grocery-store market.

IMO, he didn't do anything necessary illegal or immoral but it does sort of make him out to be a pompous schmuck which, sadly, is still legal as far as I know.

WFMI announced an intent to buy OATS, and the FTC has filed a suit to block the purchase, saying it would create a monopoly and harm consumers.

The existence of these postings came up during discovery in that lawsuit.

At this point it looks very much like the buyout won't happen, if only because the FTC has a really strong case.

[Per suggestions mid thread, these two topics have been merged]

From Morningnewsbeat.com:

The Wall Street Journal reports that the US Securities and Exchange Commission (SEC) has begun an informal investigation into the blogging habits of Whole Foods CEO John Mackey, who, it came to light last week, used an online alias in chat rooms for eight years to plug his own company’s stock and belittle the operations of his rival, Wild Oats – the very company that Whole Foods currently is trying to acquire.

“While it isn't clear that Mr. Mackey violated any laws in his postings, they have raised numerous legal questions,” the Journal writes. “The SEC is likely to examine whether Mr. Mackey's comments contradicted what the company previously said, or if they were overly optimistic about the firm's performance. In addition, the SEC will likely look at whether the CEO selectively disclosed material corporate information – that could violate a securities law passed in 2000 known as Regulation Fair Disclosure, which was designed to prevent executives from sharing information with favored clients or analysts.”

Mackey, who did not speak to the Journal for this story, has been saying that the blogging controversy is much ado about nothing, and only has been turned into an issue by the Federal Trade Commission (FTC), which is trying to block the Wild Oats acquisition on competitive grounds.

Actually, I bet the doofus is gone by the end of summer. The SEC has indeed started a probe, Whole Foods is doing an internal investigation and Mackey was forced to apologize today to shareholders. It's like the Amy Jacobsen brouhaha at Channel 5; when something doesn't look or smell right in the eyes of the public, you're toast.
>>Brent

Well, Whole Foods CEO is sorry:

http://biz.yahoo.com/rb/070717/wholefoods.html?.v=4