Before we go jumping to conclusions, the proverbial rush to judgment about former AMD Chairman and CEO Hector Ruiz and his role in the bizarre Galleon insider trading case, consider some of the facts as we know them.
I'm not interested in being an apologist for Ruiz, or anyone for that matter, but am interested in offering some perspective about the accusations flying about this morning.
Just about everyone has been chasing this story about who the unnamed AMD executive was in the US Attorney complaint that seemed to have a 90-degree angle right into the heart of some major news about to break about the company. The court papers cite conversations from defendant Danielle Chiesi that she got the information from an exec who'd been preaching about this deal for some time; that when the news broke, the executive told her it would shock the hell out of everybody. Sure sounded like Ruiz, but not until the Wall Street Journal nailed it down last night did his name become publicly — and widely — associated with the case. Whispers became shouts.
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So what happened here?
Prosecutors reportedly said that the unnamed AMD executive didn't profit from these tips, so are they really tips? Was Ruiz, 63, privately blustering to friends and associates about the impending, $8 billion rescue deal with the Abu Dhabi government? Certainly careless, but illegal too? Maybe. Was Ruiz confiding in someone he thought was a friend, who then acted on her own to profit from the information? Was Ruiz used by Chiesi for information? Was there something untoward? The accusations and innuendo are flying this morning.
I have interviewed Ruiz a few times, followed his career, marveled at his determination as Mexican immigrant rising to the highest financial and intellectual echelons in this country. Has he always been an angel? Not likely. He's a hard-charging, shoot-from-the-hip, no-nonsense boss handpicked by former AMD Chairman and CEO Jerry Sanders who's gargantuan personality and style was in direct contrast to the tiny microprocessors responsible for his fame and fortune, Rolls Royce's and Bel Air estate. Sanders, and later Ruiz, could be described at once as street hoods or tough competitors trying to save their company and the marketplace from the "jack-booted thugs" at rival Intel (Sanders' words, not mine.)
But guilty of insider-trading? It just seems anathema to everything Ruiz has been about. Anything's possible, I suppose. Look at Raj Rajaratnam, Galleon's co-founder, who was worth more than $1 billion, but risked it all for piddly little $20 million deals allegedly dripping from insider trading. That doesn’t make much sense either.
I have been a vocal critic of Ruiz's. I couldn't fathom how he lasted as long as he did at AMD, driving the company deeper and deeper into the red. The company's ATI acquisition was an abysmal failure that almost drove AMD into bankruptcy. His vocal, sometimes personal attacks against Intel were brutally consistent, sometimes un-refined, and ever-present. If he's caught up in some illegal insider trading case, his protestations of Intel's unethical and illegal behavior in the market place may start to ring a little hollow. It's unlikely this case will affect ongoing anti-trust investigations either in this country or in Europe or elsewhere, but when it comes to accusations, you have to consider the source, and this one is tainted. And this stuff, brought into the discourse, is disturbing. Something about glass houses and stones and such.
But all of that aside, until we know the real details as to why this information was shared, we can't rush to judgment.
I'm not sure what the relationship was between Ruiz and Chiesi. How they knew each other? What would possess him to share intimate details of an impending deal with her. No question he did something wrong. The question is whether it was merely unethical, or illegal. Degrees of black eyes, if you will. Something stinks here, but there may be mitigating circumstances to consider. Was he a scheming insider, and if so, without profiting from any of this, to what end? Or was he tricked, duped, which isn't much better, but maybe a little?
We need more details. And sadly for Ruiz, being outed as the unnamed AMD executive is not the end, only the beginning of this morass.
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