Rivals.com

Today in the Lipscomb alumni email I noticed a blurb about the sale of college sports enthusiast web site Rivals.com to Yahoo. Rivals.com is the work of two Lipscomb graduates that overlapped with my time as a Bison (Shannon Terry and Greg Gough). Shannon's name and face (see photo in the story on Lipscomb's web site: link). I realized why from the Lipscomb article: he was a starter on the Lipscomb basketball team. Yahoo paid something in the neighborhood of $100 million for Rivals.com. $100 million! I've never used Rivals.com before (I'm not enough a sports junkie to pay to read about it), but I had read about it before. Back in April, amid initial rumors of Yahoo acquiring Rivals, there was a bit of a kerfuffle between Shannon Terry and internet heavyweight Michael Arrington, who runs TechCrunch, "...weblog dedicated to obsessively profiling and reviewing new Internet products and companies." Arrington mentioned Yahoo-acquisition rumors and wondered if the deal might fall through like a couple others had due to Terry's previous involvement in securities fraud (link):

...two previous deals to acquire the company died once it was discovered that the CEO, Shannon Terry, was found to have been involved in a classic "pump and dump" scheme, and violated the anti-touting and antifraud provisions of U.S. securities laws in 1998. Shannon was a principal of SGA Goldstar Research, Inc. In 1998, he and at least two others, Sheldon Kraft and Charles Huttoe, were accused of engaging in "a massive ongoing market manipulation" around touting shares of a company called Systems of Excellence, Inc. Kraft and Huttoe were sentenced to prison terms. Shannon, who reportedly "cooperated" with authorities, got off with a $828,000 fine. For background information, see here and here [this link is broken]. In 2005, sources say, Fox killed a deal to acquire Rivals at the 11th hour after a routine background check on Terry revealed the fraud. Terry had not previously disclosed the issue to Fox. Fox went on to acquire competitor Scout Media for $60 million in September 2005. Shortly thereafter, AOL was supposedly close to acquiring Rivals as well, for as much as $90 million. Again, Terry reportedly failed to disclose the fraud, which was discovered during the due diligence phase of the negotiations. The deal was killed.

Here is a link to a Washington Business Journal blurb about Terry: link. Terry responded to the web post by threatening a lawsuit and Arrington posted a scan of the letter on the blog (link). The threat of the lawsuit was later dropped and a couple months later the acquisition was finalized (link). No mention of securities fraud in the Lipscomb article.