Carl Icahn Still Knows How to Write a Letter

carlicahn 4 Carl Icahn Still Knows How to Write a LetterNot that we doubted, or ever forgot, only that we’d like to stop and admire the stylings of a master of the form. Carl Icahn, of course, is the activist investor who has been waging an increasingly public proxy battle with Forest Laboratories, a war of words that’s touched on everything from the succession plan for Forest CEO Howard Solomon, the substantive worth of Mr. Icahn’s involvement in the companies he invests in and even the film-making chops of Mr. Icahn’s and Mr. Solomon’s respective sons.

Most recently, the proxy battle has found the more appropriate ground of the qualifications of the four board directors that Mr. Icahn has nominated, with Forest arguing in a letter to investors that Eric Ende, Andrew Fromkin, Pierre Legault and Daniel Ninivaggi have “significant and obvious conflicts and entanglements that compromise their independence and ability to represent all Forest shareholders.”

Mr. Icahn answered back today, and we’d like to tip our cap. Note the stacked questions, the shifts in modulation even before he hits the moment emphasis, which is his own:

Is Howard Solomon conflicted when you grossly over-compensate him in options and restricted stock with accelerated vesting while he oversees a massive destruction in shareholder value over the past 10 years? Is it a conflict when Howard Solomon was selling stock while the company was repurchasing stock? Is it a conflict when Howard Solomon was part of a board meeting where his potential exclusion by the US government was being considered? I don’t believe this Board has the slightest grasp over what constitutes a conflict. In addition, as I am sure you know, just because Mr. Ende was not elected to the Board last year does not mean that stockholders feel the same this year. Under your watch, Forest has underperformed your self-chosen peer companies by 21% since last year’s meeting. Given that underperformance, it wouldn’t surprise me if many shareholders vote differently this time around. YOU SHOULD NOT USE LAST YEAR’S VOTE AS AN EXCUSE FOR COMPLACENCY.

Well done.