Firm asks Net analyst Blodget to keep quiet
Noted Internet analyst Henry Blodget has been asked by Merrill Lynch to limit his opinions to paper, but some comments keep leaking through the gag order.
Merrill Lynch asked Blodget to not comment publicly or to the press about the companies he covers beyond what is in his written reports, until a lawsuit he's embroiled in is resolved.
"It's just a temporary situation until the litigation gets resolved," said a Merrill Lynch spokeswoman, who noted the edict came down several months ago after the lawsuit was filed.
But despite his firm's request, Blodget--who gained a cult following in 1998 by predicting that Amazon.com's stock could reach $400 per share--is a hard man to keep quiet. The affable analyst has managed to still give interviews to television, radio and print journalists, despite the firm's request.
"It's not like we're asking him to shut up," said the spokeswoman, who asked that her name not be used. "He's a real approachable guy and likes to help reporters. So if he's approached at a conference and he's speaking about a particular company, then I assume it's fine. It's the in-depth interviews and broader profiles that we don't particularly want."
On Tuesday, Blodget chatted with reporters about Amazon at an analyst conference in Seattle, talking freely about what he thought about the conference and Amazon's prospects.
Blodget's secretary said Wednesday that he was not available for comment.
The high-profile analyst, who frequently has appeared on CNBC and is often quoted in numerous financial publications, was sued in March over allegations that he had a conflict of interest in maintaining a "buy" rating on InfoSpace. An investor alleged that Blodget was aware his firm was handling InfoSpace's acquisition of Go2Net, and that he had a desire to keep InfoSpace's stock propped up. The arbitration case was filed with the New York Exchange.
The spokeswoman said she does not know when the case will be resolved and Blodget's speaking engagements resumed.
In some respects, Blodget may not mind the edict. The analyst has been under fire for maintaining "buy" ratings on Internet stocks as the sector has been pummeled in the past year.
Last July, Blodget lowered his rating on Amazon to "accumulate" from "buy." The lowered rating came seven months after the company's stock had fallen 66 percent since the start of last year.