Tuesday, May 20, 2008

Biovail Pleads Guilty: World of Baloney Mourns

The Baloney Brigade stock market conspiracy theorists lost yet another team leader today. The Canadian drug company Biovail, which has bravely fought against the truth about the company for many years, pleaded guilty today to federal kickback and conspiracy charges.

This is terribly upsetting for CEO blame-shifters such as Overstock.com CEO Patrick Byrne (see separate item on his latest publicity coup), who have dedicated their lives to concealing their incompetence behind "naked short selling" and other market conspiracy theories. This is also a bad day for the cause of bad journalism, such as the awful 60 Minutes segment that naively took up the causes of this sleazy company.

I'm still waiting for the CBS News program to tell viewers what an awful job it did in reporting on this company.

Biovail was already nailed recently with SEC fraud charges that are similar to what a few brave analysts, such as Gradient Analytics, have been saying about the company for years. I believe that a junk lawsuit Biovail filed against Gradient is still pending.

Fortune's Roddy Boyd points out that
Biovail's plea bargain doesn't just close an ugly chapter in the Toronto-based company's history. It also pulls the rug out from under a multiyear quest by the company's former management, led by onetime CEO Eugene Melnyk, to blame an alleged conspiracy of hedge funds and research analysts for Biovail's financial and legal woes. . . . Unfortunately for Biovail, federal prosecutors from Massachusetts didn't agree that the [analysts'] assertions were unfounded.
Actually I'm kind of sorry that the feds let Biovail cut a plea bargain. I think the Richard Altomare Wing of the Metropolitan Correctional Center would have been a more fitting new corporate GHQ for this company.

Zac Bissonnette comments: "Moral of story: when a company starts suing people and lashing out at its critics, sell the stock. That philosophy would have saved people a ton of money on Biovail."

© 2008 Gary Weiss. All rights reserved.

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