You have probably heard of the recent fiasco where Whole Foods CEO John Mackey was busted making comments about rival company Wild Oats on Yahoo's stock market message boards under the pseudonym Rahodeb. If you haven't heard the story Mediapost has a nice recap.
The latest example: John Mackey, co-founder and chief executive of Whole Foods, posted anonymously about his company and the acquisition target Wild Oats Markets on the Yahoo stock market boards beginning in 1999 until last year. Using the pseudonym "Rahodeb" -- an anagram of his wife's name, Deborah -- he routinely bashed Wild Oats, posting nuggets such as "OATS has no value and no future," The Wall Street Journal reports. That particular post was made in February 2005; this year, Whole Foods agreed to purchase Wild Oats for $670 million in February.
The information about Mackey's posts came to light this week, thanks to the Federal Trade Commission, which is seeking to block Whole Foods' buyout of Wild Oats, saying the deal would squash competition.
But, while criticizing a rival anonymously doesn't seem like an especially noble way to run a business, it's also hard to see how, in these circumstances, it proves an antitrust violation.
A Wall Street Journalarticle (via The Food Section) goes into detail about Mackey's comments on the Yahoo forum.
"Would Whole Foods buy OATS?" Rahodeb asked, using Wild Oats' stock symbol. "Almost surely not at current prices. What would they gain? OATS locations are too small." Rahodeb speculated that Wild Oats eventually would be sold after sliding into bankruptcy or when its stock fell below $5. A month later, Rahodeb wrote that Wild Oats management "clearly doesn't know what it is doing .... OATS has no value and no future."
Obviously, this was a huge mistake by Mackey. CEOs and insiders should stay far away from Internet forums and blog comment sections. The same post from Mediapost.com mentioned above also compares the John Mackey "Rahodep" incident to Wal-Mart's Travel Flog. The flog was pretty bad but Mackey's postings are worse. It has been a much bigger news story and more damaging to Whole Foods than the flog was to Wal-Mart.
John Mackey's blog has been put on hold.
For more coverage of John Mackey's mistake try a Technorati search for Rahodeb. That will give you a number of blogs that are discussing the story.