Thursday, July 12, 2007

Whole Fool: CEO sowed Wild Oats

I don't know much securities law, but I'm guessing it wasn't kosher, so to speak, for the Whole Foods CEO to badmouth a rival company online under a pseudonym, even though Whole Foods says his posts didn't represent the company. I'm also guessing he didn't mention to his attorneys that he had a secret life as "rahodeb" at the time. (Oh, to be a fly on the wall at the meeting at which this was revealed.)

As the speech of a competitor (statements by company representatives can count as such), CEO John Mackey's disparagement of rival Wild Oats could be actionable under the Lanham Act and various state statutes, though perhaps safe because it was mostly opinion -- braggadoccio -- and not fact. (Predicting bankruptcy might be sufficiently factual, even if it is qualified by "IMO," depending on what else he said. Also, a CEO using Netspeak: how charming.)

He justified his statements in part by claiming: "The views articulated by rahodeb sometimes represent what I actually believed and sometimes they didn't. Sometimes I simply played 'devil's advocate' for the sheer fun of arguing." I'd like to point out, however, that the devil's advocate was not, in fact, employed by the devil.


Bruce Boyden said...

I guess he wasn't expecting the Spanish Inquisition...

RT said...

Well, really, who does?

What I don't quite understand is whether the fellow Yahoo! posters who suspected his identity were joking, because rahodeb was such a big Whole Foods booster that he must be from Whole Foods, or whether they seriously believed he was the CEO.