1. Case Studies
  2. Stopping a Wall Street Short Seller
Close-up of a Wall Street sign with an American flag in the background, positioned near the New York Stock Exchange building. The sign indicates addresses from 22 to 51. The background is slightly blurred, focusing attention on the sign and flag. Close-up of a Wall Street sign with an American flag in the background, positioned near the New York Stock Exchange building. The sign indicates addresses from 22 to 51. The background is slightly blurred, focusing attention on the sign and flag. video:

Crisis Management and Mitigation

Stopping a Wall Street Short Seller

Our Client

A private equity firm that is traded on NASDAQ.

The Issue

A well-known short seller was waging a public campaign to drive down our client’s stock price, including filing and publicizing a Security and Exchange Commission (SEC) complaint against the firm.

The Challenge

The short seller had a proven track record of making good on his short plays, giving him tremendous credibility with the media and regulators. The media embraced the story of a financial firm’s malfeasance and was not easily persuaded that our client’s story was unique.

The Opportunity

The short seller had an undeserved reputation for honesty and straight dealing. Our research showed he had colluded with another short seller to spread false information about our client on social media. In addition, he had a large personal stake in the outcome and was desperate to make good on this specific short play.

The Plan

We built a persuasive counter-narrative depicting the short seller as a desperate billionaire using underhanded tactics to turn a poor financial decision into a profit. At the same time, we developed a simple way of explaining that while our client’s issue was complicated, it was not fraud or malfeasance.

We conducted an aggressive media outreach campaign to cast doubt about the short seller’s motives and truthfulness. We also engaged independent financial experts to examine the issue and make public statements supporting our client’s business practices. We targeted influential media, such as The Wall Street Journal, Washington Post, Associated Press, and a myriad of online financial publications to scrutinize the short seller rather than our client.

The Result

In six months, we were able to turn the public perception around. Stories became more balanced, internet disparagement was reduced dramatically, and the short seller changed the quantity and tone of his public pronouncements.

Ultimately, the stock price of the firm bounced back. The engagement ended when the Securities and Exchange Commission investigation concluded that our client had made a minor transgression in valuing an acquisition, and that the short seller’s larger claims of malfeasance were unfounded. The reputation was restored, and it was back to business as usual.

EXPLORE OUR RELATED CASE STUDIES.

Close-up of a dark server room filled with multiple server racks. The servers are illuminated by green, blue, and amber LED status lights, indicating active operations. The image conveys a sense of high-tech infrastructure and data processing activity.
Preparing for Operational Disruption

Training and testing senior executives to lead their way through a live fire crisis simulation impacting their global operations.
  • Crisis Management and Mitigation
A large crowd of people is gathered for a protest or rally. Many individuals are holding up blank signs, and the scene is bustling with activity. The background shows a building with open doors and multiple windows, hinting at an urban setting.
Fending Off An Agenda-Driven Internal Revolt

Challenging fabricated allegations and libelous claims orchestrated to harm employee morale and the financial health of the organization.
  • Crisis Management and Mitigation