Monday, January 28, 2008

A Commissar Will Monitor This Conference Call

Don't ask me why -- sounds to me like as much fun as getting two molars pulled -- but fraud-fighter Sam Antar has asked to participate in the Overstock.com (NASDQ: OSTK), quarterly analyst conference call, which takes place on Wednesday.

He got a response this evening from Overstock.com CEO Patrick Byrne that is truly a classic in the history of scummy CEOs :

Dear Sam,

Sure, you are welcome to participate: please send me your top three questions (in the interest of avoinding your endless "Do you pick your toes in Poughkeepsie" rants, please limit them to 25 words each, and know that I will treat compound questions as multiple questions).

You know my email (N.B. your email address for Clay is out-of-date).

Your friend,
Patrick
Too bad Byrne was born thirty years too late. He'd have made a fine functionary in any Eastern European regime at one time.

Stay tuned.

UPDATE: Sam's response, posted here, observes :
At your third quarter fiscal year 2007 earnings conference call, you had asked if I was on the line and said that you would accept questions from me if I was on the conference call. If that statement at the last conference call was not intended to intentionally mislead your shareholders, I would expect that you would welcome my participation at Wednesday's call on an equal footing with all other participants.

It is highly irregular for a participant in a conference call to be singled out and limited to three questions posed in advance, each consisting of 25 words or less. I believe that such a condition would be at variance with the principles of free and full disclosure required by the securities laws at conference calls.

You appear to be imposing conditions on me that are not imposed on other conference call participants. I will not accept special conditions that are not imposed on other participants in the conference call.

Accordingly, I again request that I be permitted to participate in this conference call on an equal footing with all other participants.
Byrne's alternatives are as follows:

1. Continue to insist that one person that he "welcomes" to his conference call, but is expected to ask difficult questions, accept unreasonable conditions not imposed on other, more pliable participants.

But the SEC (the "Ken Israel" copied on the email is SEC regional director for Salt Lake City) may not cotton to that. The SEC is investigating Overstock and Byrne, as we all know.

While I am no fan of the SEC, I do know that the agency believes in investors, analysts and the public being treated in an even-handed fashion, and really hates this kind of stuff. I remember how teed off the SEC was at the N.Y. Stock Exchange for playing games with release of Dick Grasso compensation info. But I disgress. . .

2. Open up the conference call to Antar on the same basis as other participants.

This would gain brownie points with the SEC. But then he'd have to take Sam's questions, which he wants about as much as being innoculated with an icepick. The famously unhinged Byrne has flown off the handle and rammed his Florsheims in his mouth with far less provocation.

That's a lose-lose proposition if ever there was one.

© 2007 Gary Weiss. All rights reserved.

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