Many issues with NYT coverage of Morgan Stanley fight

TheDeal.com executive editor Yvette Kantrow noted that The New York Times finally wrote about the battle its parent company is having with Morgan Stanley, but she added that there were many issues with the story that the Times didn’t address for its readers.

Kantrow wrote, “The story said that Morgan Stanley Investment Management had sent a report to the Times’ board ‘sharply critical of its governance practices.’ Examine it closely, and weird Timesean backstories begin to emerge.

“For starters, we learn that Morgan Stanley’s report was ‘prepared by Davis Global Advisors, a consulting firm run by Stephen Davis, who writes a column for the Financial Times.’ True enough. But describing Davis as a guy who writes for the FT is like saying Jack Welch is someone who writes for BusinessWeek. Davis is a bona fide corporate governance guru, just the kind of personage the Times likes to wheel out in its pro-shareholder rants. Last month, no less a governance diva than Gretchen Morgenson quoted Davis twice, identifying him as the editor of Global Proxy Watch, a weekly publication on corporate governance issues.

“Could Thomas’ ID’ing of Davis as a columnist for the FT be a subtle way of suggesting that since he writes for a rival, his report about the Times’ board might be biased? Hmm.

“Then we move on to learn that the Times’ board, after receiving Morgan’s missive, ‘asked Wachtell Lipton Rosen & Katz, headed by Martin Lipton, the well-known corporate lawyer and adviser to boards, to assess the Times’ governance practices.’ Excuse us? Is this the same Martin Lipton whom Thomas took aim at last year in a rather over-the-top business section front-pager that accused the lawyer of wearing ‘too many hats’ for clients and of giving lousy legal advice? Yes, indeedy. But lest we think that Lipton might be wearing too many hats for the Times, Thomas assures us that, according to a Times spokeswoman, ‘Mr. Lipton was hired to evaluate the board’s governance standards and is not advising the board on how it should respond’ to Morgan Stanley. That’s a relief. This nonconflicted Lipton, by the way, found the Times Co. ‘to be employing state of the art corporate governance procedures.’ Who would expect otherwise?

“The Times on Nov. 7 ran a correction to the story, which ‘misstated the involvement of the fund company’s parent’ in the shareholder campaign. ‘Morgan Stanley has not been involved at the corporate level,’ the correction explained. The story also got wrong the intricacies of the family trust that controls the Times Co., incorrectly reporting that publisher Arthur Sulzberger would have to decide to repeal the dual-class structure. Oops again. Both booboos were attributed to an ‘editing error,’ making us marvel that a sensitive story about the paper’s parent wasn’t vetted a bit more carefully.

“By the way, Morgan Stanley on Nov. 8 formally proposed a change to the Times’ governance practices. The paper covered this development with copy from the Associated Press.”

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