Skip to main content

Posts

Showing posts from 2013

Did Tesla violate S.E.C. rules by failing to disclose the retirement of George Blankenship?

Last Thursday, Silicon Beat reported that George Blankenship retired from his position as Vice President, Worldwide Retail at Tesla Motors (NASDAQ: TSLA). According to Blankenship's LinkedIn profile, he had already left the company in October 2013. Tesla's most recent proxy report listed Blankenship as a "named executive officer." The retirement, appointment, resignation, or termination of a registrant’s "named executive officer" is required to be disclosed within four business days of such a departure on Form 8-K. Therefore, it appears that the company should have disclosed his retirement no later than November 6, 2013. So far, Tesla has made no such disclosure.

On November 21, 2013, Silicon Beat reported that:

Blankenship is still listed as Vice President, Sales & Ownership Experience on Tesla’s website. But his LinkedIn profile now says he is “Director of Smiles for the Blankenship Family” and he apparently left Tesla a few weeks ago.
Shortly after S…

Is Overstock.com Trying to Cook The Books, Again?

I hoped that Overstock.com (NASDAQ: OSTK) had finally learned the error of its ways. Now it seems that the company has again resorted to accounting shenanigans to inflate its reported income.

Background

From Q2 2007 to Q2 2008, Overstock.com used an improper EBITDA calculation to materially overstate its pro-forma income in violation of Securities and Exchange Commission Regulation G. From Q4 2008 to Q3 2009, the company violated Generally Accepted Accounting Principles (GAAP) and materially overstated its reported earnings. I endured malicious personal attacks, cyber-stalking, pretexting, and threats to my personal safety from Overstock.com’s gun-toting CEO Patrick Byrne and his paid thugs in retaliation for exposing its illegal accounting practices. In each case, I complained to the Securities and Exchange Commission. Eventually Overstock.com was forced to stop using those illegal accounting practices. It seems that Overstock.com is up to its old tricks again.

Executive summary

In the…

Is Medifast a Cry Baby or a Corporate Bully?

This is the way corporate bullying works. Last Monday, September 30, 2013, I reported that Medifast (NYSE: MED), its former CFO, and the engagement partner who supervised its audits for its former accounting firm agreed to the entry of separate Cease-and-Desist Orders by the Securities and Exchange Commission for various violations of securities laws. On Wednesday, October 2, 2013, I received a letter from its lawyers with the following barely veiled threat, “…The Company, is not adverse to taking decisive action to redress false accusations against its business.”

Background

On September 19, 2013, Medifast (NYSE: MED) disclosed that on the previous day it consented to an entry of a Cease-and Desist Order and agreed to pay a $200,000 civil money penalty in connection with an "investigation" by the Securities and Exchange Commission into its improper financial reporting from 2006 to 2009. I reported that Medifast's press release and 8-K report made no mention that Brendan N…

Was Medifast transparent with investors about an S.E.C. investigation?

About two weeks ago, Medifast (NYSE: MED) disclosed that it consented to an entry of a Cease-and Desist Order and agreed to pay a $200,000 civil money penalty in connection with an "investigation" by the Securities and Exchange Commission into its financial reporting from 2006 to 2009. However, Medifast's press release and 8-K report made no mention that Brendan N. Connors, its former CFO and Marc G. Nochimson, the engagement partner who had supervised Medifast's audits, consented to the entry of separate Cease-and-Desist Orders which alleged improper conduct. Furthermore, I did not find any specific disclosure of the above referenced investigation in any of Medifast's previous filings with the S.E.C. I asked the company for an explanation via email, but it did not respond my request.

Medifast pays a $200,000 civil penalty

Both Medifast's press release and identical 8-K report did not mention that its former CFO and the engagement partner who supervised its a…

Simple Questions for Donald J. Trump

Dear Donald Trump:

Last Saturday, New York Attorney General Eric Schneiderman filed a lawsuit against you, Trump Entrepreneur Initiative LLC formerly known as Trump University LLC, and others alleging that the defendants, "...operated an unlicensed, illegal educational institution" and engaged in other fraudulent practices.

On twitter, you claimed that:

Lightweight NYS Attorney General Eric Schneiderman is trying to extort me with a civil law suit.
According to the lawsuit:

Until May 2010, respondents operated their program illegally as "Trump University," because they were not chartered as a university as required by New York law and were even notified by the New York State Education Department ("NYSED") as early as 2005 that their use of the word "university" violated New York law.
On Good Day NY, Schneiderman said:

He hasn't explained why he operated this thing as a university when it was against law; why they never got their teachers cer…

Overstock.com CEO Patrick Byrne Sleeps With a Gun

In numerous blog posts in the past, and in widespread media coverage, evidence has accumulated for years that Overstock.com CEO (NASDAQ: OSTK) Patrick Byrne has shown signs of being mentally unbalanced and paranoid.

Byrne has blamed his company's financial woes on an unnamed "Sith Lord." He hired paid goons to stalk his real and imagined adversaries and to write lengthy conspiracy theories on the Internet. Byrne has close ties with Bo Gritz. The Anti-Defamation League lists Bo Gritz as a far-right extremist with “extensive connections to both white supremacists and anti-government groups and leaders.”

Patrick Byrne's infamous temper tantrums when he doesn’t get want he wants are well documented too. He made obscene and misogynistic comments to a female reporter. He suggested that she gave “blowjobs” to Goldman Sachs traders. He suggested that a male reporter “Sucks It Likes He’s Paying the Rent.” An independent research analyst was told that “You deserve to be whippe…

Patrick Byrne: Armed, Dangerous, and Delusional

Update article: Overstock.com Hatchet Man Judd Bagley's Downward Spiral: Junkie, Confessed Criminal, Admitted Adulterer

Last Wednesday, Overstock.com (NASDAQ: OSTK) CEO Patrick Byrne was arrested after Transportation Security Administration (TSA) officers found a loaded pistol concealed in his carry-on bag at an airport security checkpoint. He spent several hours in Salt Lake County jail before being released on bail. The company made no disclosure to investors, and news of Byrne's arrest was only disclosed on Friday in a TSA announcement.

This was only the most recent of a series of bizarre incidents involving Patrick Byrne dating back to 2004, when Byrne blamed an unnamed "Sith Lord" for his company's problems, and when he made obscene and misogynistic comments to a female reporter. Rather than dismissing this as just another instance of Byrne behaving irresponsibly, the press, securities analysts, investors and other interested observers of the company should …