Wholefoods Bankruptcy

Is Whole Foods is morally bankrupt?

Feeling conservatives had been winning the limelight in the debate over healthcare reform through a serious of high profile stunts and remarks, advocates of reform decided to steal back some of the media’s attention, forming a flash mob Sept. 26 in an Oakland Whole Foods in response to the CEO’s recent Op-Ed in the Wall Street Journal in which he argued healthcare is not an intrinsic right.
At 6:11 p.m., 35 protesters, who had been fake-shopping the aisles of the green foods giant, convened at the middle of the store, and launched into singing “Hey Mackey, you’re a swine,” some shouting it into a megaphone and others dancing a choreographed jig as a live orchestra blared from all directions.

According to Enterprise 2.0 : Now we know why Whole Foods CEO John Mackey
has starting updating his blog again after a long hiatus between posts:  he’s been gearing up to defend himself from the revelation that on several occasions he tried to drive down the stock price of his smaller rival Wild Oats by leaving unflattering pseudononymous comments on online investor forums.  Whole Foods has since acquired Wild Oats.

Both the Wall Street Journal and the New York Times have the (you should pardon the pun) whole sordid story today.

Mackey’s postings on Internet financial forums, made under the name ‘’rahodeb,’’ said Wild Oats Markets Inc. stock was overpriced and predicted the company would fall into bankruptcy and then be sold after its stock fell below $5 per share.

In February of this year, Whole Foods announced it would buy Wild Oats for about $565 million, or $18.50 per share.  Posting under the name ‘’rahodeb,’’ Mackey said the Wild Oats stock was overpriced and predicted the company would fall into bankruptcy and then be sold after its stock fell below $5 per share.  (He obviously didn’t believe that because Whole Foods wound up paying about $18.50 a share for Wild Oats.

Mackey’s unfortunate brain farts were made public this week as part of a lawsuit by the Federal Trade Commission to block Whole Foods from buying Wild Oats on the grounds that the sale would combine the two largest organic and natural foods retailers and raise prices for consumers by concentrating too much power in one company.

The revelation is obviously a PR disaster for Whole Foods and its squeaky-clean, healthy-living image, as well as for Mackey’s who has always sold himself as a straight and narrow small businessman who hit it big through hard work and integrity.


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