101 Dumbest Moments in Business
2005's shenanigans, skulduggery and just plain stupidity.
11. To leave a message, press ... right ... there ... no, a little lower ... that's it ... ah-h-h-h-h.In July, Gerald Martin, the founder of a physicians' answering service in Westchester County, N.Y., is charged with computer tampering after a competing service discovers that its system has been hacked. Patients trying to reach their doctors were instead greeted with busy signals or the sounds of sexual moaning.
12. You invited who over for a play date down in the basement?Lionel, the largest U.S. manufacturer of model trains, settles a lawsuit with competitor K-Line in which Lionel alleged that K-Line had paid Lionel's chief engineer "to work surreptitiously ... and incorporate Lionel's current sound, speed control, and electrical transformers" into some K-Line products. Meanwhile, Lionel files for Chapter 11 while appealing a $40.8 million verdict won in 2004 by MTH Electric Trains -- which claimed that Lionel and a subcontractor had stolen its trade secrets.
13. The furor dies down, but only after Sony says that the real intent was to prevent the spread of the malicious Celine Dion virus.Sony BMG installs software on its CDs "to prevent unlimited copying and unauthorized redistribution," but the cure is worse than the disease: The software makes customers' PCs vulnerable to hackers and viruses. Software maker Internet Security Systems labels Sony's program malicious because it "actively attempts to hide its presence from users." Ultimately, Sony offers uninstall software and has to recall millions of albums, including The Invisible Invasion, by the Coral; Healthy in Paranoid Times, by Our Lady Peace; and On Ne Change Pas (One Does Not Change), by Celine Dion.
14. How 'bout you stop sending us those Celine Dion CDs?
15. A perfectly good orgy of violence and mayhem, ruined.In June a Dutch programmer releases software that lets players of Take-Two Interactive's Grand Theft Auto: San Andreas access sexually explicit content left in the game's source code by its developers. Already marked "Mature" for "blood and gore, intense violence, strong language, strong sexual content, and use of drugs," the game gets rerated "Adults Only," causing Target and Wal-Mart to pull it from stores. Take-Two's quarterly revenues fall $40 million short of projections.
16. It descends from the military-industrial complex. Not so ironically it unleashes grave embarrassment."We consider the ad offensive, regret its publication, and apologize to those who, like us, are dismayed with its contents." -- Mary Foerster, spokeswoman for Boeing Integrated Defense Systems, about an ad in the Sept. 24 issue of National Journal that depicts the CV-22 Osprey in an assault on a mosque accompanied by copy that reads, "It descends from the heavens. Ironically it unleashes hell."
17. Say "cheesed."Three and a half years after filing for Chapter 11, Polaroid is sold to Petters Group Worldwide for $426 million. Chairman Jacques Nasser and CEO J. Michael Pocock walk away with $12.8 million and $8.5 million, respectively. More than 4,000 retirees, meanwhile, receive one-time checks for $47 but lose their medical and life insurance benefits.
18. Perhaps they should change the motto to "Don't be stupid."New Google employee Mark Jen adds a post to his blog in which he says he spent his first day in an HR presentation about "nothing in particular." Apparently, Jen snoozed through the company's strict disclosure rules. In a subsequent post, he reveals that the company expects unprecedented revenues and profit growth in 2005, projections that Google has yet to share with Wall Street. Jen soon receives another presentation from HR: a pink slip.
19. "Don't be stupid" keeps sounding better and better.In July, Google informs CNET that it will prohibit company employees from talking to its reporters for a full year. Why the boycott? In an article about Google's privacy practices, CNET reporter Elinor Mills demonstrated the kind of personal information that can be found online by googling CEO Eric Schmidt, revealing his $1.5 billion net worth, details of his attendance at a $10,000-a-plate fund-raiser for Al Gore, and -- gasp! -- his passion for flying airplanes. In September, facing criticism for hypocrisy and overreaction, Schmidt cuts short the silent treatment and grants Mills an interview.
20. He's a perfect 10 -- a 1, plus 9 glasses of sparkling Lambrini!Having barred alcohol marketing that associates drinking with sex, British regulators block an ad that shows women imbibing Lambrini sparkling wine while using a fishing pole to hook a hunky guy. The Advertising Standards Authority says the ad violates its guidelines because the guy "looks quite attractive and desirable to the girls." It would pass muster if only he were "overweight, middle-aged, balding, etc." The company then runs a version of the ad using a paunchy, chrome-domed model.
From the February 1, 2006 issue