On Thursday, August 22nd, Patrick Byrne resigned from his position as CEO of Overstock, an online furniture and home goods retailer. His resignation arose following his own comments made on August 12th through an Overstock statement.
Byrne attacked the FBI, referencing a “deep state” and “men in black” in his statement titled, “Overstock.com C.E.O. Comments on Deep State, Withholds Further Comment.” Byrne claimed he had helped the FBI with the “Clinton Investigation” and “Russia Investigation”, saying they “turned out to be less about law enforcement and more about political espionage conducted against Hillary Clinton and Donald Trump.”
The former CEO’s statement also referenced a romantic relationship he had with Maria Butina, an alleged Russian agent who is currently serving an 18-month prison sentence after being accused of attempting to infiltrate powerful political circles with direction from the Russian government during the 2016 presidential election.
Byrne says he met Butina in Las Vegas in 2015 at a libertarian convention and entered a relationship shortly after. He claims that, over the course of their relationship, she consistently spoke of meeting or wishing to meet those involved in the political campaigns of Hillary Clinton, Donald Trump, and others. Butina’s actions apparently made Byrne wary, leading him to communicate with the FBI regarding his conversations with her.
A Miscommunication Between the FBI and Byrne...
The law-enforcement officials that he was communicating with are whom Byrne is referencing when he used the terms “Men in Black” and “Deep State” in his statement. In a live interview with CNN that aired the day of his resignation, Byrne claimed that these FBI agents had directly ordered him to pursue a relationship with Butina.
"Just to be clear Patrick, so people understand what's going on here, the FBI wanted to you continue your association to get information. They never told you that you needed to have a romantic relationship with somebody?" CNN anchor Chris Cuomo asked. "Well eventually, yes they did," Byrne answered.
Byrne revealed on Fox News, "I was given some fishy orders and I carried them out in 2015-2016, thinking I was conducting law enforcement.” He later identified one of the officials he had been ordered by to be former FBI Director James Comey. Comey of course dismissed Byrne’s claim as “ridiculous” when he spoke to CNN, saying, “The FBI doesn’t work that way.”
On the day Byrne released his now-infamous statement, the Overstock.com stock plunged. On the day he resigned, the stock rose more than eight percent. Byrne, however, does not seem to be regretting the decision at all, and perhaps views it as a great business opportunity. “My presence could — and likely would — be disruptive to strategic conversations that are occurring, one of which is with my most preferred suitor in the entire industry,” Byrne told The New York Times, of course omitting the name of the potential buyer.
Byrne claims he was acting on the advice of a friend of his, Berkshire Hathaway chief and one of the richest men in the world, Warren Buffett, whom Byrne affectionately refers to as his “Omaha Rabbi”, when he published his statement. Buffett and Byrne became close with each other through Byrne’s father, John Byrne, who led the financial turnaround of GEICO in the 1970’s. Buffett later purchased GEICO and hired Patrick Byrne to run one of his other companies which made uniforms for public service members, strengthening the relationship between the families.
This situation is not the first time Byrne has stirred controversy with his statements and claims. In the 2000s, he claimed an unnamed Wall Street mastermind, referred to by Byrne as the “Sith Lord”, was crafting a convoluted agenda to shatter the stock of Overstock.com.
DeepCapture.com is a still-active website created and owned by Patrick Byrne in which he has published over 400 of his own pieces and opinions since May of 2006. Developed as an outlet for Byrne’s thoughts on his own business, other businesses, and the corruption and inner workings of many of them, DeepCapture was voted the Best Business Blog by the Weblog Awards in 2008 as well as an Xmarks Top 25 site in the category of Corruption.
The former CEO told the New York Times he would continue to be involved in a number of the company’s investments and perhaps a new business, “But first I want to surf.”
Should We Trust The (Former) CEO of Overstock.com?
Do Byrne’s claims have any hint of truth to them? Of course, at first glance his statements appear to be the ramblings of a lunatic bent against the government. However, what continues to intrigue me is the FBI’s short, unspecific rejection of Byrne’s accusations. “The FBI doesn’t work that way” is one of the most generic dismissals that could be made by a federal organization. Granted, Comey has every right to be that short with the media when discussing this situation, especially if Byrne’s allegations are entirely fabricated.
Why would Patrick Byrne commit career suicide over completely unfounded claims? This is the most considerable factor I encountered when developing an opinion on Byrne’s statements. He’s received plenty of backlash from the public, his investors, and those who hold public offices since he published his piece - yet he’s showing no signs of slowing down. Fight the power, Byrne - Fight the power.
Byrne has doubled down on his accusations and stated he intends to “continue to speak to the world” through his website. Just this week, he published another piece on his website titled, “Maria Butina and I, Part I: Meeting Maria,” in which he aims “merely to organize and state clearly the things I said on television recently, so as to reduce room for misreporting.” His voice clearly is not losing any traction. As long as people will read, he will write. I’m betting we’ll learn a lot more about Ms. Butina, her relationship with Byrne, “the Deep State”, and everything else Patrick decides to “reveal” to us in the coming months.
Patrick Byrne’s hiatus in the business world isn’t expected to last very long, given his history. I expect to see more of Byrne’s claims and theories become public in the near future as he continues to publish works on his own website. When he inevitably resurfaces in national headlines to make us feel the Byrne, check back to the blog for some thoughts. I’m sure I’ll have many.
PEACE, FOR NOW. – MIKE MARQUEZ