Some People Still Upset About The Bear Stearns Hedge Fund Meltdown Incident


Some guy whose money Bear Stearns lost sued the securities firm this week. Samuel Cohen (of the Baltimore Cohens) is accusing BS and its top execs of "recklessly" buying up billions in subprime loans and trying to hide its "tremendously risky subprime mortgage portfolio" from those who might have a vested interest in it by not so much lying but maybe "overstating" how it was doing. (Lying.) This all seems very three months ago to us, but we get that Cohen might feel differently.
In addition to seeking damages, Sam has said that he wants to see Bear Stearns implement better corporate governance practices, which could include, he suggests, splitting the chairman and CEO roles. We like this because what's a little lost money to Bear Stearns? Not such a big deal, it happens all the time. They pay this guy (really his company because it's a derivative lawsuit but that's not the point) and move on, relatively embarassment-free. The part about (*basically*) asking for James Cayne to be fired, or have his responsibilities significantly lightened adds a little bit of public shame we really appreciate.
Granted, Cayne would probably secretly love this, and is perhaps even in Cahoots with Cohen ("I don't think we should add that to the suit, can't I just ask for money?" "No, just do it!") but whatever. In other news, Fortune may soon be blocked at Bear because of the latest cover featuring Cayne and a bunch of CEOs who lost a ton of money, asking "What were they smoking?" (The special insert with commentary by L.Craig was apparently the breaking point, according to a BS spokesman.)
Bear, AIG Sued Over Subprime Exposure [NYP]