You all might remember back to last year and the surprise, perplexing announcement by journalist William Lobdell, a former religion writer for the L.A. Times, and Barry Minkow, a convicted con man turned reform scammer turned Christian pastor, that they had become partners in a new kind of media venture. Their iBusiness Reporting would investigate inflated claims by public companies, and pay for it by first short-selling stock in the companies they would expose. It seemed dicey at the time — to attack a company and profit from a bet that your story will hurt its stock price — but Lobdell and Minkow put up spirited defenses of the concept. Last October, Beth Barrett in the LA Weekly wrote a long piece saying it was just another Minkow scam and that he was benefitting from lazy media reporting. Essentially, said Barrett (and federal prosecutors), Minkow was spreading false information about the firms to drive the stock prices lower.
Fast forward to this week. Minkow has been sentenced in Florida to five years in prison after pleading guilty to insider trading. He has been ordered to make $583 million in restitution. And on Tuesday, the city of Costa Mesa, in Orange County, extended its contract with Lobdell for somewhat controversial in OC PR services. He and Minkow had closed iBusiness Reporting before the federal indictment came down, and Lobdell became a columnist for the Daily Pilot newspaper in OC. He left there to take the PR gig with Costa Mesa in the news for laying off city workers.