Thanks to Pat's expose (Pat is the one who has been the real object of scorn), we know that the Gilder Report on AVNX, and the subsequent runup, had very fortuitous timing effects for insiders looking to unload perhaps a very substantial portion of their shares come May 3. Now the pro-Gilder crowd (including GG himself, it seems) maintains that GG in no way personally benefits from this effect. I'm actually inclined to believe that is true, if GG states so unequivocally. But, I guess that brings us to the real issue: I believe GG should have been aware of the unusual timing circumstances because he should have read the SEC filings on a company he was about to pump. If GG is as moral as his supporters would like to believe, then it does not make sense that he would knowingly pump AVNX under such circumstances. Which leads one to think that GG must have been ignorant of publicly available and material information at the time the GTR was published. That, I believe, is the unsavory conclusion sitting at the end of the argument line drawn by the GG supporters. They just haven't noticed yet. I know, he doesn't do valuation. But does that preclude some form of due diligence?
So I would ask George: Were you in fact ignorant of:
1. The imminent end of lockup on insider sales of AVNX shares?
2. Of the fact that AVNX was, prior to your report, trading under the required share price for insiders to unload shares?
3. Of the likelihood that your recommendation would push the stock above the required minimum share price for the required number of days, thereby enabling insiders to unload shares?
4. Of the likelihood that AVNX insiders, anticipating the potential benefits of a strong recommendation in the GTR, could have been highly motivated to present their company in the best possible light?
With regard to Item 4, I would assume, given your current stature as a tech guru, that you have a general awareness that many companies hope to catch your eye for the favorable exposure you can provide. Therefore, I would think due diligence should be an important part of your screening process. |
