That question of MII, again. This time the issue of Material Insider Information has risen in regard to David Sokol. Until yesterday, when he resigned, he had been a BigFoot at Berkshire Hathaway and a possible successor to Warren Buffett.
As Robert Lenzer, who's not a lawyer, reports in FORBES, Sokol owned 96,000 shares of Lubrizol stock when he talked up with Buffett Berkshire Hathaway's aquiring Lubrizol. Buffett went with the recommendation and Sokol made $3 million on his Lubrizol stock. According to Lenzer, this doesn't pass the smell test.
Buffett contends Sokol did not break the law. But, the law will decide that one, just as it's deciding whether Galleon's Raj Rajaratnam broke the law. In addition, there could be shareholder suits by those who had owned Lubrizol. They could argue, explains Lenzner, "that they were cheated out of the difference between the price they sold their shares to Sokol and the price Berkshire is paying Sokol for his stock."
At any time, Buffett wouldn't welcome this questioning of his company or himself. He certainly has to be unhinged that this is happening when he is 80 years old and near retirement.
An abounding accordance has been bogus of the achievement that Sokol adeptness crop over as accomplished of the Berkshire one day. He was one of an annual of Buffett's replacements, that the columnist identifies from time to time.
Posted by: database design software | April 04, 2011 at 05:23 AM
I thought Combs was already named "coach in waiting"?
Posted by: Kevin Thompson | April 02, 2011 at 09:14 PM
A great deal has been made of the fact that Sokol might take over as head of Berkshire one day. He was one of a list of “Buffett replacements” that the press identifies from time to time.
Posted by: Atlanta Roofing | March 31, 2011 at 11:04 PM