With shares of Movie Gallery (OTC: MOVIQ) having closed 2007 at just by 2 cents per share in the wake of the company’s bankruptcy, I thought it would be fun to take a look at what the company was saying back in 2006, when its shares were trading more than 100 times higher.

You might think the company’s CFO, Thomas Johnson, would have been engaged looking for ways to stop the cash bleeding and return film Gallery’s operations to something other than depressing failure.

But you’d be wrong. No, Johnson was actually conducting an interview with Bloomberg, saying that he had asked the SEC to investigate allegations of bare short selling in the company’s stock:

“I’m throwing out the towel, saying ‘Help me.’ There are rules designed

to deal with that, and folks are still managing to do these bare short sales. It’s extremely frustrating. It’s like being on the front line and folks are shooting you from every direction.”

“On the frontline… citizens shooting at you from every direction.” I wonder whether that’s how film Gallery shareholders felt when the company recently filed a reorganization plan that canceled the stock of the company’s common shareholders.

The moral of the story is that: When the naughty management of a awful company starts complaining about bare short selling … go find a company where the management spends its day running the trade.

Original post by Zac Bissonnette

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