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Jul.19

4:12 PM ET

Thursday, 19 Jul 2007

Whole Foods - Half Truths

John Mackey, Co-founder and CEO of Whole Foods Market
Whole Foods
John Mackey, Co-founder and CEO of Whole Foods Market

Call it the Strange Case of the Anonymous CEO Web Postings. A court filing by the Federal Trade Commission has revealed that for years always-outspoken Whole Foods CEO John Mackey added his "two cents" to Yahoo's message board about the company's stock. Posting under the name "rahodeb" to keep his real identity secret, Mackey talked up Whole Foods and his own leadership while liberally trashing competitor Wild Oats.

Now the FTC is using some of those postings in its effort to show Mackey is trying to illegally stifle competition through his proposed acquisition of Wild Oats.

On the Whole Foods web site today, Mackey defends himself, saying he posted anonymously because it was "fun" and that rahodeb's postings "do not represent any official beliefs, policies, or intentions by either Whole Foods Market or me."

But some critics say Mackey showed poor judgment, at least, and may have jeopardized the company's reputation and the Wild Oats Deal. And late Friday, the Wall Street Journal reported the SEC has begun an informal inquiry into the postings.

The Heat asks: Is it wrong for a CEO to post anonymously on the Internet?

Here you can find the facts and opinions you need to make up your own mind . . . and tell us what you think.

News: SEC Examines Whole Foods CEO's Chat Room Exploits: WSJ (July 13)

Reuters on CNBC.com: Whole Foods CEO Panned Wild Oats in Web Posting (July 12)

AP on CNBC.com: Whole Foods CEO Attacked Rival Online (July 12)

Video: What Was He Thinking? CNBC's Brian Shactman reports on CNBC's Squawk Box (July 12)

Video: Whole Foods - Half Truths with Boston University School of Management professor James Post, Berg Center for Ethics and Leadership Director Brad Agle, WSJ Editorial Board member Stephen Moore and Morning Call co-host Liz Claman (July 12)

CNBC.com Web-Only Video: Whole Foods Reporter's Notebook with Managing Editor Tyler Mathisen and Reporter Brian Shactman (July 12)

CNBC.com Stock Tools: Whole Foods Market (WFMI), Wild Oats Markets (OATS)

Wall Street Journal: SEC Opens Inquiry Into Online Posts By Whole Foods CEO (July 13)

Wall Street Journal: Whole Foods Is Hot, Wild Oats a Dud -- So Said 'Rahodeb' (July 12)

New York Times: Whole Foods Executive Used Alias (July 12)

TheStreet.com: Whole Foods CEO Admits to Message Board Posts (July 12)

Atlanta-Journal Constitution: Whole Foods CEO's blog attack

Yahoo Finance via New York Times: Stock Board Postings by 'Rahodeb' (May 19, 2000 through August 12, 2006)

Whole Foods: The CEO's Blog - John Mackey

Federal Trade Commission: Memorandum In Support Of Plaintiff's Motions For Temporary Restraining Order (July 10)

Salon.com: Whole Foods CEO John Mackey's wacky Web rants (July 12)

Peter Cohan on Blogging Stocks: Whole Foods CEO determined to do himself in -- electronically (July 11)

Mark Cuban to CNBC: Whole Foods CEO Displays 'Digital Narcissism' (July 12)

The Heat believes strongly in protecting free speech from encroachment by the government. There's no doubt that it should not be illegal for a CEO, or for anyone, to post anonymously on the Internet.

But the specific question is whether it is "wrong" for a CEO to post anonymously, and the answer is yes. In a country in which corporate executives have a pretty lousy reputation when it comes to ethics, we need our CEOs to be above reproach. Playing games with the truth, even if they are relatively innocent games, feeds into the public's negative stereotypes and hurts the entire business community.

Questions? Comments?

Is it wrong for a CEO to post anonymously on the Internet?

Email us at:

"The question if he is wrong or right can only be answered by his exact posts. If the information he provided was intentionally false, then it is deceitful and that is wrong for a CEO. If his opinions or facts were truly what he believed, then it is not wrong." - Matt, California

"I am an organic food devotee and have shopped at Whole Foods Market... Mr. Mackey's postings ... prove to me he will do anything to make money. Does this impropriety extend to his produce selection. Can we believe anything his store says about its 'whole paycheck' prices for quality? I have severe doubts. He has lost my business." - Caroline, Washington State

"Do you even need to ask?" - Jim, Virginia

"John Mackey should absolutely be fired! Sleazy, despicable, disgusting, and unbecoming of a CEO, that gives the whole industry a bad reputation." - Dave, New York

"Anyone who goes on message boards knows that 99 percent of what is written is complete utter nonsense. Therefore, there is nothing wrong with anybody writing whatever they would like on the message boards so long as there is no inside information revealed." - An Anonymous CEO :)

"Absolutely. This guy is a public figure. In my opinion, he MUST reveal who he is when it has to do with his company or a competitor." - Larry, Florida

"Enjoy yourself, John. I don't understand why everyone wants to make a sacred cow out of CEOs. Mackey's got the same rights we have. I hope he continues to play and enjoy himself. Life is short." - Paul

"What John did reminds me of what guerrilla marketers do anonymously everyday. They pose as normal consumers and express opinions favorable to the company that hired them, in order to create hype and spread positive word of mouth for that company. As controversial as these tactics are, John Mackey's behavior is distinctly different from this. This sort of behavior seems to indicate that the man who invented an industry is now a megalomaniac. Mr. Mackey's immaturity shows that success can go to the head, and he may no longer be a prudent decision maker. Perhaps he should be fired for being an idiot?" - Scott, Louisiana

"Resign? Let's give him a dunce cap instead. Shareholders should be more concerned about his impaired judgment. Did the name RAHOBED really fool anybody? If he's trying to be clever, he shouldn't quit his day job -- wait, maybe he should." - Lance, Indiana

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