Barry Diller says FTC complaint stemmed from ‘inadvertent’ error
Media mogul Barry Diller is speaking up about his recent tiff with the Federal Trade Commission involving his stake in Coca-Cola Co.
The executive behind the launch of Fox Broadcasting and a former chief executive of Paramount Pictures has agreed to pay $480,000 to resolve FTC allegations that he failed to properly disclose his purchases of Coke stock between 2010 and 2012. Because the purchases brought his holdings above $63.4 million, he was required to disclose them to the FTC but failed to do so, the agency said.
Diller issued a statement Wednesday calling the disclosure problem an innocent mistake.
“As to the Coca-Cola purchases, I made those in my personal capacity. I was not made aware of the necessity to file, and the moment I became aware, I filed promptly and complied with all regulations -- the only infraction was in the timing,” Diller said in the statement. “I gained no advantage of any kind and there was no harm to Coca-Cola shareholders, nor to anyone else. While I am surely not suffering, one can fairly question the tactics used by the FTC in penalizing individuals for de minimis open-market share purchases and inadvertent paper shuffling.”
“It is inconceivable that my less than 1% investment in Coca-Cola shares, made as a director of Coca-Cola, could harm competition,” Diller continued. “Ironically, corporate governance gurus encourage such purchases, while the FTC seeks to deter them through filing fees, delays and fines. I do not know the rationale for the government to penalize such purchases with hundreds of thousands of dollars in … filing fees.
“I don’t want to burden the public with more words on this matter -- the only reason for this statement is because I care about good citizenship and good government, and it would be unfair to both not to comment.”
Diller, 71, the billionaire chairman of IAC/InterActiveCorp, bought 120,000 shares of Atlanta-based Coca-Cola on Nov. 1, 2010, according to the complaint, filed Tuesday in federal court in Washington.
As a result of those purchases, Diller held voting shares worth more than $63.4 million, which was the reporting threshold under federal law at the time, the FTC said.
Between Nov. 1, 2010, and April 26, 2012, Diller bought an additional 605,000 shares of Coca-Cola voting securities and on April 27, 2012, he acquired 264,000 more shares, the FTC said. He failed to make the necessary filings for all of the transactions, according to the agency. Diller subsequently made corrective filings.
The FTC took action after warning Diller in 1998 to establish an effective compliance program after he failed to report the acquisition of voting shares in Citysearch Inc. The FTC declined to seek penalties at that time, Bloomberg News reported.
Kent Landers, a spokesman for Coca-Cola, said in an email to Bloomberg News that Diller is a “valued member” of the board and his status remains unchanged.
ALSO:
National home prices jump 12% in May
Citi to pay Fannie nearly $1 billion over flawed mortgages
Construction spending jumps, propelled by building of new homes
Follow Stuart Pfeifer on Twitter
