Does Overstock.com Have a Board of Directors?

Warning: This item is not recommended for pregnant or nursing women, children under 18, persons with high blood pressure or heart disease, or anyone with a weak stomach:

Reading the latest atrocity by the nauseating (and I do mean nauseating) Judd Bagley, Overstock.com's Director of Communications, official spokesman and resident stalker, has gotten me wondering: does Overstock.com have a board of directors?

Not "does it have a competent board of directors?" or "does it have independent board members who care about their jobs?" -- the answer to those two questions obviously being no -- but whether there is such a thing as "corporate governance" at this chamber pot of a company.

What got me wondering about this was an act of blackmail, signed proudly by Bagley, directed at the proprietor of the O-Smear website, which has exposed this SEC-investigated company's unethical conduct.

You can read about the blackmail here, but I think the letter is worth replicating below:

From: Judd Bagley
To: scipioafricanus_iv@yahoo.com
Sent: Thursday, June 14, 2007 11:51:26 PM
Subject: just thought I'd ask...

I thought I should tell you that I've have known your real identity for a while now.

Up until last week, it appeared that you'd grown tired of o-smear and all the games (which would make "outting" you unnecessary) but lately it appears that's not the case.

I don't want to cause anybody unnecessary harm, but I'm beyond tired of the lies.

If you choose to continue as you have been, I will write about you on AntiSocialMedia.net. In doing so, my goal is not to intimidate, but to let you own your words; under those circumstances, I think the lies will take care of themselves.

Having said that, I'm also very much aware of the impact this could have on your reputation, especially where you live, and I feel obligated to offer you a way out. So, if you're ready to set things right, I'll keep your name to myself and figure we'll both be karmically better off for it.

I look forward to your response (and will be PMing this to your IV account, as well).

--
Judd Bagley

Note the dictionary definition of blackmail: "to force or coerce into a particular action, statement, etc."

This may go down in history as the first blackmail letter written in smug corporate P.R. doublespeak. ("I'm beyond tired of the lies"="I'm beyond tired of the truth." "My goal is not to intimidate"= "My goal is to intimidate you and every other critic of Overstock.com") I say that because Bagley was, of course, aware that his letter would be made public. He's proud of it, you see.

Note the similarity in wording to the threat that he made against a Wikipedia administrator in late August, shortly after going on the Overstock.com payroll in his initial title of "director of social media."

No other company in the U.S. would sanction such disgusting, unethical, and legally questionable conduct by a corporate official, made doubly odious by the fact that Bagley was hired to do the bidding of CEO Byrne, and his actions have a long history of being supported and promoted by Byrne.

Any other corporate board would discharge both Byrne and Bagley -- something obviously inconceivable for the laughingstock, lapdog, functionally nonexistent Overstock.com board.

Reading this email from a corporate thug to a private citizen also makes me wonder: Is there is such a concept as "SEC enforcement" when it comes to the misdeeds of Overstock and its CEO Patrick Byrne? Or has Byrne's ancestral wealth and political influence makes that concept moot as well?

This latest episode in the Bagley-Byrne saga is a test of Overstock.com's board of directors as well as the Enforcement Division of the SEC.

The board's independent members, I understand, have been advised of Bagley's latest actions. Ditto for the SEC.


If they do nothing in a reasonably brief period of time, then the answer to the question that I posed above will be answered. It will mean that Overstock.com, for all intents and purposes, does not have a board of directors.

As for SEC enforcement -- well, just read my book and you can understand why nothing has been done. If anything is done, I would surmise, it would only happen long after Ovestock is a wretched memory.

Also today, Sam Antar has a revealing, detailed post on how Bagley and Byrne have used anti-Semitism as a tool of corporate intimidation. It makes for fascinating reading.

Oh, I almost forgot to mention: O-Smear did not respond and Bagley carried out his threat on Overstock's antisocialmedia.net corporate smear site. By so doing, Bagley showed that he is as much a schmuck as he is a blackmailer.

Bagley's "revelation" is that O-Smear is run not by the Sith Lord but by some guy in Indiana -- a private citizen who is disgusted with corporate creeps like Judd Bagley.

To make the slimy picture complete, and thumb his nose at Joseph J. Tabacco Jr. and other independent directors, Bagley put a spyware bug in his ASM post, so as to track people distributing the item via email.

The onus is now on Tabacco and the other independent board members. By serving on the board of this company, they have a moral and, I suspect, legal obligation to register strong and public disapproval of the activities of Bagley and Byrne. If they don't, their silence would be tacit approval of Bagley's and Byrne's disgraceful behavior, and they will bear full responsibility for their neglect of duty.

Quite frankly, I wonder how reputable people like Tabacco could allow their reputations to be sullied by associating with a company such as Overstock.com.

Some reaction:

The Motley Fool's Daniel Rubin calls Bagley's blackmail adventures "the most incredible thing I've seen in my seven years of following the market. "

Says Rubin:

Is there ANY oversight of all this filth? Any at all? To see this mockery go on right out in the open, and involving an American public company is starting to genuinely challenge my faith in the integrity of the system. As I've said, this is the cruelest irony of this debacle. This pitiful, puke-inducing chapter of American business never ceases to turn the stomach - cyberstalking, anti-Semitism, Sith Lords, international mobsters, conspiracies, and enough message board animosity to fuel a space shuttle.

Rubin added in another Motley Fool post: "The question is when will all [Byrne's] railing and false accusations and seemingly blatant illegal activity result in his removal and legal action? This man has left a trail of animosity and denigration of the human spirit that is awe inspiring in it's scope."

That's the question. The answer is with Joe Tabacco and his colleagues.

More reaction:

• Sleazy McSleaze Now Even Sleazier (Dealbreaker)

• Is Overstock threatening its detractors? (AOL Finance BloggingStocks Blog)

• Judd Bagley is threatening people who speak out against the management and deception at Overstock.com? (Tracy Coenen's FraudFiles blog)

Digg this!

© 2007 Gary Weiss. All rights reserved.

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Wall Street Versus America was published by Penguin USA on April 6.
Click here for its Amazon.com listing and here for more information on the book, from my web site, gary-weiss.com.

Boycott Overstock.com?

Prominent securities attorney Howard Sirota is calling for a boycott of Overstock.com. He's doing so in reaction to an attack on him in Overstock's antisocialmedia.net corporate smear site, which attacked him (and me too, natch) in response to his concerns about anti-Semitic posts on the Yahoo board and the smear site. 

I certainly agree that this corporate chamber pot deserves a customer boycott because of the vile behavior of its CEO Patrick Byrne and his paid cyberstalker, the nauseating Judd Bagley. 

And Sirota has a point. In one December 2005 Motley Fool post, Byrne made bizarre comments on Israel and Jews that led blogger Jeff Matthews to doubt their authenticity because of what he gently described as "their apparent anti-Semitism." Any such doubts have since been laid to rest -- Byrne has acknowledgd that he is the author of this and other Motley Fool posts under the pseudonym "Hannibal100." 

Referring to odd references to Israel and New York Times columnist Tom Friedman, Matthews noted:

I can think of no clear reason for making the analogy to Friedman and Israel except one: the enemies cited in the post (Herb Greenberg, David Rocker and Jim Cramer) are all Jewish.

Even for the CEO of Overstock.com, hints of a Jewish conspiracy would represent a rather disturbing twist in the ongoing saga.

The Stalwart commented that "it's not a stretch to read an anti-Semitic tone into the letter. Not only does he finger all Jews in his conspiracy, but he, out of nowhere, throws in a jab at Thomas Friedman's unevenhandedness in covering Middle-East affairs." 

However warranted Sirota's call for a boycott may be -- and I believe that it is warranted -- I would argue that a wide-ranging, nationwide boycott of this company is already underway. 

As you can see from the chart below, customers have been avoiding the Overstock.com website since the end of 2005 -- which happens to be approximately when Byrne made his company name synonymous with "nuts" in his paranoid "Sith Lord" anti-short selling crusade.

   

Notice the particularly sharp dropoff this year, which coincides with the revelation in the media that antisocialmedia.net, which had previously engaged in illegal, anonymous cyberstalking, was secretly operated by the nauseating Bagley. 

Then you have the dollars-and-cents aspect of this customer boycott of the company, as seen from this spectacularly unspectacular income statement, below.

   

Note that the number is parenthesis is getting bigger. That is no good. Got to take off the parenthesis before bigger numbers are better. 

Last but not least we have the stock price, which is less than half of what it was at the end of '05:

   

As you can see, Overstock.com is already being boycotted by customers and investors of every race, color and creed. And mind you, for the most part, they're not avoiding Overstock.com because they don't like Byrne's behavior. They're boycotting the company because there are, quite simply, better places to buy stuff. 

That's the party to Overstock's downfall that Byrne has yet to insult -- the American people. Oops, wait a second. He has. 

UPDATE: Forensic accountant Tracy Coenen observes:

What really is the purpose of making anti-semitic remarks on a message board designed to discuss the stock of a public company? My guess is intimidation.

Howard refers to Judd Bagley and his Anti-Social Media website. Judd is an “executive” at Overstock.com, and he’s a little ruffled that people like Howard and Gary Weiss and Sam Antar are exposing the shenanigans going on there. Quite simply put, something is not right at Overstock, the shareholders are suffering because it, but Judd wants everyone to shut up already.

Judd’s really a nobody. He’s the mouthpiece for Patrick Byrne, the CEO of Overstock who is quite often referred to as “Wacky Patty” because of his delusional rantings and Sith Lord conspiracy theories.

So the executives at Overstock want to intimidate people to stop discussing all the unusual items on the financial statements, the discrepancies in the disclosures, the fact that the company waited nearly a year to write down inventory it knew was junk, and the fact that executives of the company pump the stock on a variety of message boards using pseudonyms not known to the average investor. (Rules? What rules?)

© 2007 Gary Weiss. All rights reserved. 

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Wall Street Versus America was published by Penguin USA on April 6. Click here for its Amazon.com listing and here for more information on the book, from my web site, gary-weiss.com.

Should Message Boards Stomp Out Anti-Semitism?

 

There's an interesting exchange of messages on the Yahoo Overstock message board initiated by Howard Sirota, a prominent attorney. The subject is a disturbing one -- the tendency of the Baloney Brigade anti-short-selling lunatics to use anti-Semitic stereotypes and imagery. Sam Antar's blog has a post on the same subject. 

Sirota wrote a post, entitled "No More Anti-Semitism on this Board!," in which he noted, among other things, that he did a search for "Jew" on the Overstock message board and found "428 posts containing the word 'Jew.'" 

Sirota expressed disgust concerning that and anti-Semitism on Overstock.com's antisocialmedia.net corporate smear site:

This is supposed to be a forum to discuss Overstock.com I strongly suggest you stick to Overstock.com and make no further anti-semitic remarks. It's easy to trace your IP address to a physical location, see it on Google, and get directions from Mapquest, and turn it all over to the feds and the B'Nai Brith Anti-Defamation League.

Interestingly, the reaction was one of hostility from both fans of Overstock and detractors, who apparently cling to the notion that anti-Semites should be given free reign to express their swill -- if for no other reason than to demonstrate the bankruptcy of their cause. (They were also off-put by the threatening tone of Sirota's message.) 

Sam's blog focuses on the threats and bigotry in Overstock.com's antisocialmedia corporate smear site, in an open letter to the Overstock board audit committee. 

I personally am not in favor of censoring the anti-Semites of the Baloney Brigade. If they've got it-- in this case, bigotry -- I say "flaunt it!" They sure have. However, I won't weep if Yahoo decides that such messages are unsuitable for a family message board.

The broader issue is why bigotry and fanaticism exists among the baloneys. It certainly is a matter of record that fans of the Baloney Brigade and its leader, Patrick Byrne, include conspiracy theorist Bo Gritz and ultra-right kook Daryl Bradford Smith (as I noted in an item a few weeks ago). 

One aggressive anti-Semite -- he used to send me anti-Semitic emails -- is a leading "stock counterfeiting" conspiracy theorist who has testified for the cause, as I described in a blog item a while back. 

Jew-baiting is actually a pretty old and much-noted phenomenon among the Baloney Brigadiers, and was first observed in 2005 by Jeff Matthews (see this post and this). Byrne himself went on a rampage on a pro-Israel message board about a year ago, after the board posted about anti-Semitism on the Yahoo board.

Byrne went berserk, posting entire an entire off-topic article, insulting the board members and generally making a damn fool of himself. It seemed at the time, and now, to be a particularly nutty way of interacting with potential customers. 

Note too that in a one-week exchange of messages, Byrne never denounced the anti-Semites among his followers, or apologize for their rhetoric. Instead he maintained they were agents of the opposition, and devoted his energies instead to attacking the people who had brought the anti-Semitism to his attention. 

That tells you something, don't you think? Something pretty darn ugly, I would say. 

One investor, after noting how Byrne had gone out of his way to alienate readers of the pro-Israel blog, made the following good point on the Yahoo message board:

The bigger problem isn't that the CEO is running smear campaigns, making threats, or wearing a dunce cap and all but that he's doing it in a way that hides it from investors. He should be linking back all of his rants at various blogs and message boards to a single site at OSTK investors can easily check to see how many potential customers Patrick has offended. And he should 8-k that so everyone is on notice.

© 2007 Gary Weiss. All rights reserved. 

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Wall Street Versus America was published by Penguin USA on April 6. Click here for its Amazon.com listing and here for more information on the book, from my web site, gary-weiss.com.