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Editorial The Three Musketeers vs. The Dirty Dozen The
term The Dirty Dozen was coined after 12/1/00 Among the outrages perpetrated against Ocean Spray shareholders, none was greater than the letter by twelve individuals who were surrogates for certain Board members. They sent a letter to shareholders prior to last year's annual meeting. That letter was severely and unfairly critical of Chip Morse and Don LeClair, the Massachusetts nominees for seats on the newly downsized Ocean Spray Board. Board incumbents Morse and LeClair had been active and vocal in their support for a sale of the company. The result of behind the scene machinations prior to the Ocean Spray Annual Meeting was that two losers of the regional Massachusetts election, Ben Gilmore and Douglas Beaton, were elected to the Board by a majority of shares (not shareholders) mostly from Wisconsin and New Jersey. Those twelve signatories almost immediately became known in the cranberry community as The Dirty Dozen. Although some who signed the letter had been in favor of a sale of the company, the end result was that control of the Board was effectively ceded to a few large shareholders who were opposed to a sale. Unbeknownst to most shareholders, another behind the scenes movement began at around the same time. A group of shareholders favoring a sale began legal action in an effort to force the Board to provide the information from the various consultants who studied the sale option to all the shareholders, and to put the question of reconsidering a sale to a vote at the 2001 Annual Meeting. While rumors of a lawsuit persisted, and many growers hoped that someone would take up the cause, only those directly involved in preparing the law suit knew about it. Cranberry Stressline was a resource only insofar as it covered information relevant to the cranberry industry. We were kept in the dark too. Although more than three individuals worked tirelessly to take up the cause of so many shareholders*, the official plaintiffs on the Complaint against the Ocean Spray Board and the Ocean Spray Counsel deserve to be called The Three Musketeers because they have publicly put their names and reputations on the bottom line. They and those who worked with them deserve the gratitude of all Ocean Spray shareholders for standing up to the individuals who usurped control of the cooperative and made it into their personal fiefdom. Ocean Spray is a cooperative, and its shareholders are not serfs toiling in the bogs and marshes for the benefit of a privileged few. The fact that the Garfield DeMarco, Howard Morse and Larry Harju are themselves large growers has been presented as an argument to undermine the credibility of their efforts. This makes no sense. We should be grateful that they have taken up the cause for those less affluent. No one ever said that The Three Musketeers had to be poor. Larry Harju has been criticized for what some see as a belated conversion to their cause. But Harju had the courage to admit in a letter that is an addendum to the Complaint that he was essentially brainwashed by the cult mentality of the Board. Larry Harju is a man of the utmost integrity and totally lacking in pretense. The hardest thing for him this year, one suspects, was having to keep the law suit a secret while friends were desperate for a glimmer of hope. Cranberry Stressline has endorsed a sale of the branded portion of Ocean Spray for some time. We believe that the cranberry industry cannot survive unless cranberries are marketed aggressively overseas. Ocean Spray cannot do this. Only a multi-national giant can, and make no mistake, if a Coca-Cola or Pepsico doesn't buy Ocean Spray, one or both will market cranberry products worldwide by developing their own source of cranberries. All Ocean Spray growers, even those who aren't up to equity, and won't receive stock in the company that buys Ocean Spray, will benefit from a sale. Conversely, they will be hurt if a Coke or Pepsi takes control of the international market without Ocean Spray. We have also addressed the issue of what information can reasonably be kept from Ocean Spray shareholders and from the general public. The Ocean Spray Board and management have a cult-like obsession with secrecy. They have violated the spirit of the cooperative. If Ocean Spray were regulated by the SEC, most of what they claim as proprietary information would be public and easily accessible through the Internet. Ocean Spray management has also tried to make a case for keeping analyses from Dr. Ray Goldberg, Merrill Lynch, and Bain & Co. confidential because they say releasing them would give potential suitors information that would ultimately hurt their bargaining position should the company enter into acquisition negotiations. This argument is a blatant attempt to pull the wool over the eyes of shareholders. Any corporation interested in acquiring Ocean Spray will make it their business to know the inner workings and value of the company. Knowledge that Ocean Spray is hiding such information from these corporations will be counter-productive in negotiations. Consultants have called Cranberry Stressline representing several well known suitors of Ocean Spray. Every one of them said that they had never dealt with a company that was so difficult to get information from. These are top professionals who deal with the largest companies and they liken trying to get information from Ocean Spray to dealing with a banana republic. If Ocean Spray wants to be perceived as a world class company they should start acting like one. Ultimately, for the individual cranberry farmer, the hope for survival is in expanding the market for cranberries. With iced teas, sports drinks, bottled water and nutraceutical drinks having made the name "juice aisle" obsolete in the United States, the only way to increase demand is to introduce cranberries to literally hundreds of millions of international consumers. It doesn't matter whose label is on those bottles. It doesn't even matter whether the bottle has a blue wave on it or a big red berry. What matters to cranberry farmers is that they can hang on long enough for somebody to bring demand in line with supply.
Outgunned
at the Ocean Spray Annual Meeting, a small group of * Those shareholders whose names are now on the record in Exhibits to the Complaint, and the former Board members who signed a letter to the shareholders all deserve kudos.
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