I logged in today, and had received an email from Dr. Byrne. He apparently read my latest pieces, and had some insightful comments. After reviewing the correspondence, I asked him if it would be OK to publish it – and he gave me permission.
Let me first say that Byrne is more forgiving than I, or perhaps more of an optimist – I don’t have much positive to say about the SEC “backing off” on their subpoenas to Herb and Carol. What information was essential to get on Thursday, i.e. that required a subpoena, but had changed by Friday? Either you need the material or you don’t. Patrick has a different perspective. We disagree on this.
I will also say that Nocera’s piece, upon a second review, strikes me as much like the American government saying that they were being “victimized” by the Native American population, and thus were heroes for “standing up to them” and taking all their land, and committing genocide. It’s that silly and transparent. I just can’t get over that any thinking human would believe some dot com out of Utah would have the power to “silence” the NY Financial press, and further wonder how to contrast that absurdity with the huge pile of venomous, ugly, negative articles that have come out about Byrne and OSTK during the period that Nocera asserts Byrne was “silencing” them. Isn’t that sort of like Howard Stern claiming he lacks the ability to say what is on his mind? A friend of mine read the Nocera piece and just said, “Oh, Puhleeese.”
My sentiments exactly.
Here is a simple graph to demonstrate the absurdity of Nocera's premise, representing approximate communications effectiveness and reach:
In the small world department, Nocera also edited Bethany’s Enron book. How about that?
I had a section here discussing the odd timing of the Lapdog's decision to move to a free format on his newsletter. Apparently he did do so on Feb. 2, which means that he made the move before he received the subpoena. We don't know when Gradient and Rocker received theirs, so I can't rule out that he saw the train coming down the tracks, but whatever caused the shift, it wasn't his subpoena. So that is definitively answered, and all the speculations to the negative were erroneous. I have a policy of correcting anything that can be shown to be factually incorrect, and unlike some financial journalists, I actually do it. So the offending section and very funny graph have been removed, although the speculations as to why he didn't notify anyone about receiving his subpoena for over two weeks are still unanswered.
Now back to Bunny business.
I predict a rash of other articles much like the NY Times piece, both attacking Biovail, as well as Byrne - the miscreants think that everyone believes everything they read in the NY papers, and invest heavily to get their perspective across there. We should start a dead pool and track the authors - I'll go with at least a dozen by the end of next week.
But enough about me. Here is the letter from Dr. Byrne:
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Hi Bob,
Thanks for the nice defense on the Nocera piece. I do not know what to make of their hysteria: are they flailing? Are they winning us supporters because they are more or less unmasking themselves? Hard for me to know from inside the tornado.
I will get to that in a moment. First, I think I want to get something to you and thus, to the public, because these guys may be trying to develop a new node on the party line (you know how they telegraph their punches). That node is that any federal inquiry was somehow conjured up by me, that this is some crazy hunting of witches that I have incited. Maybe they think that they had better pre-spin the events that could follow. Maybe they think the Federales care more about how they are written about in the press than I do. So let me set the record straight prophylactically:
I am not behind any investigation, least of all by the SEC. Wherever they are, they got there on their own. I think guys like Nocera and Herb just don't get how transparent this whole thing has become, so they imagine that law enforcement must need some special goading to look into things. That is one step short of hilarious: the rest of America is wondering, how come it took
them so long?
As far as being "shocked," as you say: well, yes and no. I am not "shocked" in the sense of, "I thought they never would." I was surprised, in the sense of, "It was news to me."
It is true that some of the witnesses from Gradient provided me with documents. When we filed our lawsuit, I was contacted by a number of state and federal authorities (I think 7) requesting whatever I had. I provided copies of materials. When Gradient wrote me a nasty-gram insisting that those documents were private and that I confirm that I would keep them secret, I responded, honestly, that 7 state and federal groups had called, and I had released the documents to them, per the request of law enforcement. Seemed like the honest thing to do.
That said, I respond to reporters' questions about this by saying only that I have made myself available to any law enforcement folks who want to talk about what is going on (I will not even confirm whether I have spoken with any specific group, including the SEC).
That is what has gotten kind of funny: yesterday a journalist (Kara from the WSJ) called asking for my opinion of the subpoenas against Herb, Carol, Gradient, and Rocker. While word reached me last week through the Wall Street grapevine of Rocker's subpoena, I was not really sure of that, and I had no idea that Herb, Carol, or Gradient had been subpoenaed (though, I must say, it is no surprise). In short, the stories now paint me as the Sith Lord, masterminding what I am actually learning about from the reporters.
Now as far as Nocera's piece goes, it is about as dopey as he sounded when he called. Of course he leaves out all kinds of salient facts, and you have deconstructed it beautifully, but I'll throw in something you wouldn't know. That is, I get occasional letters from Herb and David Rocker and even Donn Vickrey. Never any, "Hi, how are you, do you mind if I ask a couple questions?" Typically with Herb they have been abrupt or snarky letters. David generally waits until the busiest day of the year (like, December 10), to write me a letter with detailed accounting questions that he knows it will take some real time to sit down and answer. Once he wrote about Stormy, as I recall. Usually I take the time to answer fairly generously, even though their letters tend to display the same sense of courtesy that Tim Mullaney displayed. On a couple occasions when I was feeling particularly chipper I have even dropped a line to them asking them about their state of mind. I really am curious: I'd love to be the proverbial "fly on the wall" (who wouldn't?), wondering if they have lost the arrogant smugness they had when this started. When did they stop chuckling at the "Whacky Patty" stories, do you think, and begin to understand the fix they are in? (Love to know your guess.)
Oddly, Herb and Rocker don’t answer my (rarer) emails to them: they fail to reciprocate. I guess I should not be surprised, as bullies generally cannot understand "reciprocity." Herb gave one to his friend Nocera (the one who thinks Herb "is one of the straightest shooters I know") to write about my "taunting" and "bullying": he fails to mention whether he thinks Herb's and Rocker's notes to me are taunting or bullying, or Tim Mullaney's endlessly abusive email is, or whether Roddy leaving a "liar" message on my machine might also be "bullying." No surprise there: we have learned long ago that these guys cannot abide by the same rules they wish upon others.
Judging from the emails I am receiving, I wonder if this is actually backfiring on them. I am receiving email from people who recognize how co-opted the system is, and their recognition is being driven by these party hacks. Maybe I am kidding myself, but I think they may be doing some of our work for us. Let me know what you think.
On a different note, I might respectfully dissent from your call on the SEC. Are they backing down? Are they figuring out they will get the same information from other subpoenas? I cannot imagine they did not give serious though to subpoenaing the two "reporters" in the first place. I don’t know. I am not as cynical as you, so I am not ready to conclude yet that it is as you say. I feel…. like they could be the white hats after all.
It would be nice.
Regards,
Patrick