Bear Stearns Book Battle: House of Cards Author Cohan Quotes ex-CEO Cayne Ranting Against WSJ Reporter Kate Kelly

Wall Street Journal reporter Kate Kelly didn’t know what to expect the week before last when she opened her advance copy of House of Cards, the new book by William D. Cohan on the downfall of Bear Stearns. Would it be great or awful? A clip job or a robust work of original reporting? Ms. Kelly was particularly interested because she was writing her own book on Bear’s collapse, due out in June from the Portfolio imprint of Penguin Group USA.

Ms. Kelly had already sacrificed some advantage to Mr. Cohan by allowing his book to come out months before hers. She wasn’t finished, was her reasoning, and there was no point in rushing it and doing a bad job. Still, if it turned out that Mr. Cohan, the former investment banker and award-winning author of The Last Tycoons, had written an airtight, definitive account of Bear’s demise, Ms. Kelly’s contribution to the field could very well be ignored upon publication and quickly forgotten regardless of its merits. 

Which is to say there was rather something at stake for Ms. Kelly, a onetime Observer writer, as she flipped to the back of House of Cards and looked up her name in the index.

Of the four entries she found there, it was the second one, where she is called a “cunt … whose capability is zero,” that really got Ms. Kelly’s attention.

The reference comes as part of a quote from former Bear Stearns CEO Jimmy Cayne, whose downfall Ms. Kelly arguably helped expedite by writing a devastating A1 Journal story in November 2007 that depicted him as an erratic, dotty pot-smoker. Mr. Cohan had interviewed Mr. Cayne extensively for his book, and the man’s blustery, often obscene mini-monologues are peppered throughout the narrative. (Among the others clobbered are Treasury Secretary Tim Geithner, whom Mr. Cayne says is gay, in the pejorative sense.)

Mr. Cayne’s full quote about Ms. Kelly, as it appears on page 403 of House of Cards, also casts aspersions on Ms. Kelly’s editor at The Journal, Michael Siconolfi, and characterizes her former colleague, CNBC commentator Charlie Gasparino, as a “snake of massive proportions.” The lot of them, a very angry Mr. Cayne is quoted as saying, were out to get him, inserting biased hooey into their stories about him and even printing quotes from a lunchtime conversation that was supposed to be off the record.

Ms. Kelly and Mr. Siconolfi were surprised to read Mr. Cayne’s remarks. Why hadn’t Mr. Cohan warned them that he was going to include such things in his book, so they could at least respond to him? 
“Mr. Cayne’s reckless allegations about the Journal’s reporting of the Bear Stearns collapse is utterly false,” said Wall Street Journal spokesman Robert Christie said in a statement Friday. “If someone had asked us to comment about Mr. Cayne’s crude and reckless assertions, the Journal would have immediately done so.”

Portfolio publisher Adrian Zackheim, meanwhile, who acquired Ms. Kelly’s book after reading her three-part series on Bear last spring, said Mr. Cohan had committed a “journalistic faux pas” by not calling ahead.

Mr. Cohan defended himself on Friday, telling The Observer that he tried several times to get on the same page with the Journal people by emailing Mr. Siconolfi and asking to interview him.

“I tried him twice, and he blew me off twice,” Mr. Cohan said. “The lawyers at Random House felt that was a sufficient number of attempts. I was on deadline and deadline came.”

Mr. Cohan’s interview requests—copies of which were provided to The Observer by both The Wall Street Journal and Mr. Cohan’s publisher, Doubleday—were short and deliberately general, never mentioning Bear Stearns by name or making specific reference to Mr. Cayne’s remarks (in his first email, he referred to his book “on the financial crisis”). Though Mr. Cohan did say in one of his emails that there had “been some statements made” that he wanted to give Mr. Siconolfi “the chance to comment on,” his exact purpose was left murky. 

“Mr. Cohan failed to disclose to our editors the nature of his reporting,” the statement from The Journal said. “He neither informed us that he was reporting about Bear Stearns or was quoting Mr. Cayne’s comments about the Journal’s reporting and its news staff in his book.”

Mr. Cohan said Mr. Siconolfi could have surmised that his emails were about Bear—after all, he noted, it was The Journal that reported news of his book deal with Doubleday—and argued that he should not have been expected to provide so many details to his potential interview subject.

“I would have disclosed the entire nature of my questions if he’d agreed to get on the phone with me, but he wasn’t gonna do it,” Mr. Cohan said. “What reporter was gonna lay it all out in an email?”

He acknowledged freely that he’d never tried to contact Ms. Kelly directly.

“What was I going to say, ‘Hey, Kate, I don’t know know you and you don’t know me, but, Jimmy has called you this name. … Do you have a reaction to that?’” Mr. Cohan said.

He went on: “I don’t know Kate Kelly from Adam. And I have tremendous respect for her reporting and writing, and I think I pointed that out about 15 times in the book. She’s mentioned in the index and her work is quoted throughout the book. I think she’s a fabulous reporter.”

Reached by phone this morning in the Journal newsroom, Ms. Kelly said, “I would have appreciated a call,” and declined to comment further. 

Bear Stearns Book Battle: House of Cards Author Cohan Quotes ex-CEO Cayne Ranting Against WSJ Reporter Kate Kelly