Something I've never been able to wrap my head around is the scale at play with the Supermicro story.
If the story is that a small handful of motherboards that were destined to be shipped to cloud providers from Supermicro had some remote monitoring / control capabilities (of varying types opportunistically applied) added to them at the behest of the Chinese government that sounds completely plausible and incredibly hard to verify and/or defend against.
I say plausible as we know that US intelligence agencies have conducted similar actions:
A hoax implies they made it up. Instead they have multiple sources giving similar stories, in an area that is shrouded in secrecy of both the corporate and national security kind.
It's hard to report in this area: people can't and won't go on the record, motivations can be murky and very technical details are extremely important.
However, the parts that can be verified are easily verifiable, the technical details seem realistic and the motivations align.
It's possible that the story is wrong, but hoax seems to be the wrong way to think about this.
Because the bar is really high if they’re a news outlet. You have to prove that they knew what they were saying was false, and did it with the intent to harm.
Besides, I’m sure SuperMicro just wants it to blow over and be done with it. Being in the news for a lawsuit will bring it up again and possibly harm them financially as people (managers who order) who don’t understand things have knee jerk reactions.
If Super Micro knows they didn’t do it, they should absolutely love the story. Buyback the underpriced shares and make a ton of free money once the market realized the Bloomberg story is false. I don’t know if they actually did that, but that’s what I would have done. I didn’t actually do that because I trusted Bloomberg a lot. But there was substantial profit to be made as an insider. I bet many/most employees made that trade, at the very least.
Generally, when a company doesn't sue over something like this, it's because they don't have a case. And that always means that enough of the allegations are true that they couldn't win an absolutely massive judgement in court.
Because in the US, truth is an absolute defense to the defamation torts. (The same is not truth in the UK; you can still be liable for defamation even if everything you said is true. See, e.g., the case of the Nazi-fetishist MP.)
The Streisand effect is not a thing companies worry about. Because more brand damage = more monetary damages to collect.
> Vinci SA fell victim to a fake release claiming the French builder had fired its finance chief amid accounting irregularities, prompting the stock to plunge before the company denied the report.
> Bloomberg News was among the few news organizations to report from the false statement.
> “We are a victim of a hoax,” spokesman Paul-Alexis Bouquet said on Tuesday, denying that the Paris-based company had released any statement. Although the company’s website hadn’t been hacked, technically speaking, fake statements had been sent in the company’s name, he said.
> Investors were caught off guard after the publication of a release saying that Vinci had discovered an accounting error and had fired Chief Financial Officer Christian Labeyrie. The shares plunged 18 percent, the most in more than 17 years, before Bouquet said the report was false. Vinci will file a complaint about the incident, the spokesman said.
> “We are a victim of a hoax,”
Vinci was the victim of a hoax, Bloomberg was happy to report it without doing enough fact checking, they were spreading and part of the hoax.
If the Vinci website itself had been hacked, and the faux press release distributed from there, Bloomberg would obviously have a strong case. That doesn't seem to be the situation though, and so I'm curious to what channel this fake press release came through, e.g. a spoof email or Twitter account.
Isn’t Vinci SA the operator of all those French toll highways that were supposed to be free once construction was paid off, but continued to be tolled anyway?
The highways are actually privately operated. The privatization of highways was a big public issue back in the days, with most people against it arguing that it will lead to an increase in prices due to the profit-seeking nature of the operators.
Turns out, they were right, and in hindsight, privatization is a failure as far as the highway users are concerned.
On the one hand, if true, all Bloomberg had to do was produce evidence; a single compromised server. They didn't. On the other hand, if the journalists fabricated the entire story, saying that all these big companies were hacked, why didn't anybody sue them? It was a major accusation! It just kinda...disappeared.
This might be the answer to you second question. No one seems to have taken the Bloomberg story to be true. Just went "that's dumb" and dropped it. In fact the only times I've ever seen it resurface is in a context to point out something negative about Bloomberg (like now), not the companies named in the article.
Sort of like the Elon Musk defamation case that just ended. Plaintiff didn't get anything because people didn't turn on him due to the accusation, they turned on Elon.
If it's not believed then you couldn't have suffered harm.
What exactly would they sue them for? Defamation and libel claims don't just require the defendant to be wrong, they have to have known or ought to have known that the claims were false. If Bloomberg could point to some outside source, anonymous or not, I don't see a way that Supermicro could meet the standard of proof necessary to sue them over it.
> On the one hand, if true, all Bloomberg had to do was produce evidence; a single compromised server. They didn't.
If the story were true, under what circumstances could Bloomberg reports have come into possession of a compromised sever to satisfy this requirement?
> On the other hand, if the journalists fabricated the entire story
Journalists evaluate and report what they're told by sources. For instance: they don't do scientific experiments themselves, but rather interview scientists about their results and report their statements. Their quality control is to get multiple sources to corroborate each other.
Saying Bloomberg journalists "fabricated" the story is going too far. If it's false, what's likely is that either their sources were either mistaken or dishonest.
The Big China Chip Hack was never actually debunked.
It was refuted, yes, but every company always does that, right up until they admit in a court settlement that the allegations were true all along. Despite the supposedly slanderous statements, none of the supposedly slandered companies has sued over the article, even though in several cases they suffered material impacts to their stock prices and financial results.
...But nothing.
Despite supposedly defamatory statements, nothing was done by any of the companies mentioned in the article.
Comments here have mention the Streisand effect as the reason for inaction, but the Streisand effect does not apply to defamation. The concept behind the Streisand effect is that efforts to censor information just result in greater dissemination. However, in a defamation lawsuit with potentially billions of dollars of damages at stake, you want greater dissemination of the defamatory statements, because that increases the payout at the end of the road. And because with enough money you can recover from the negative PR (see, e.g, Tylenol, Ford, Toyota, Tesla, BP, etc.).
I don't think there's much of any "evidence" to prove it and a hack like that is pretty.
Then again nobody ... did anything after that either and everyone responded kinda awkwardly about it.
I can't help but wonder if they got it dead wrong, but anyone clarifying or suing to prove otherwise would expose something else and so ... nobody talks?
Wouldn’t Apple or Amazon suing Bloomberg force them to provide details and access to their farms in ways that could expose more info than they are willing to give ?
I think about the kind of info we only get when lawsuits happen, and here the suing party could be losing more in collateral damage for just punishing a petty journal ?
>> I can't help but wonder if they got it dead wrong, but anyone clarifying or suing to prove otherwise would expose something else and so ... nobody talks?
Sure. What if the boards were hacked, but not by the Chinese? What if some company insiders knew? Just wildly speculating, but the response at the time seemed odd to me.
It's win win for everybody. The narrative supports the effort to have less dependency toward China manufacturing and it's in line with the later China-US trade war.
Bad example. All of the allegations in the Bloomberg article were true. Leif Olson actually did all of the things alleged, however the Bloomberg article missed that he supposedly did these things as satire...because Olson didn't actually bother to clarify that his posts were satirical until several days after they were made (and importantly, several days after the article itself was originally written).
Both Olson and Bloomberg had bad judgment here. A political appointee should not have made sarcastically anti-anti-Semitic statements, because he should have had the brainpower to know that in the Trump administration such statements would be taken at face value. And Bloomberg probably should have revised the article to add a paragraph about how a Trump appointee's anti-Semitic statements were actually anti-anti-Semitic in light of additional context that wasn't in the posts at the time they were made.
Interesting, didn't know press releases were vetted. I always figured they are just copied and pasted since there's sites where you can pay to syndicate them but not sure how legit that stuff is since never issued a press release, and with many companies running their own blogs wonder if it's even worth doing them anymore?
Also kinda reminds me of the lawsuit in Ohio against Facebook. A charter school ran ads, and messed up their attendance count, so other school districts are sueing Facebook trying to recover funds they thought should of went to their school districts instead, which seems like an interesting case but no updates on it in like 6 months, so not sure what the progress is on the case.
The headline probably needs qualification that the fine was in Europe, not the U.S. I was shocked that any U.S. regulator would attempt to push against the First Amendment in this way. It's a different story with more context.
I am not familiar enough with US customs but first amendment (free speech) seems irrelevant here. Bloomberg got fined for market manipulation by the AMF, the French organization equivalent to the SEC/FCA in the USA/UK.
This isn't a freedom of speech issue since obviously they were free to say whatever they wanted, lies and misinformation included. This doesn't imply freedom from consequences.
Causing a company to lose 18% value because they couldn't be bothered to verify is negligence, incompetence, or malice (or a combination) not freedom of speech and it's only fair to receive a fine. Bloomberg is making a habit of such reporting.
It is a freedom of speech issue, at least from a US perspective. Whether newspapers can be held liable for inadvertently publishing false information was the exact issue at hand in New York Times v. Sullivan, a case which is one of the foundations of modern First Amendment jurisprudence. It held that, in almost all circumstances, they cannot.
+1. In order for this to be punishable in the US, they would have had to have known this press release was fake before publishing it which would be a much different story.
The headline should be updated to say they were fined by France.
Readit News
Here's a more in-depth explanation from 2017 (the incident happened in 2016): https://www.complianceweek.com/the-vinci-code-fake-news-pres...
If the story is that a small handful of motherboards that were destined to be shipped to cloud providers from Supermicro had some remote monitoring / control capabilities (of varying types opportunistically applied) added to them at the behest of the Chinese government that sounds completely plausible and incredibly hard to verify and/or defend against.
I say plausible as we know that US intelligence agencies have conducted similar actions:
https://arstechnica.com/tech-policy/2014/05/photos-of-an-nsa...
And that's without even direct access to the manufacturing floor (as in the Supermicro case).
I haven't read a single bloomberg article since they published that story. Journalistic integrity is very important to me.
A hoax implies they made it up. Instead they have multiple sources giving similar stories, in an area that is shrouded in secrecy of both the corporate and national security kind.
It's hard to report in this area: people can't and won't go on the record, motivations can be murky and very technical details are extremely important.
However, the parts that can be verified are easily verifiable, the technical details seem realistic and the motivations align.
It's possible that the story is wrong, but hoax seems to be the wrong way to think about this.
Besides, I’m sure SuperMicro just wants it to blow over and be done with it. Being in the news for a lawsuit will bring it up again and possibly harm them financially as people (managers who order) who don’t understand things have knee jerk reactions.
It's entirely reasonable for a company to decide that it's not worth the investment and not pursue.
And to refer back to this article, it's the French AMF fined Bloomberg, Vinci only had to file a complaint, not a full lawsuit with teams of lawyers.
Because in the US, truth is an absolute defense to the defamation torts. (The same is not truth in the UK; you can still be liable for defamation even if everything you said is true. See, e.g., the case of the Nazi-fetishist MP.)
The Streisand effect is not a thing companies worry about. Because more brand damage = more monetary damages to collect.
https://web.archive.org/web/20161123142234/https://www.bloom...
> Vinci SA fell victim to a fake release claiming the French builder had fired its finance chief amid accounting irregularities, prompting the stock to plunge before the company denied the report.
> Bloomberg News was among the few news organizations to report from the false statement.
> “We are a victim of a hoax,” spokesman Paul-Alexis Bouquet said on Tuesday, denying that the Paris-based company had released any statement. Although the company’s website hadn’t been hacked, technically speaking, fake statements had been sent in the company’s name, he said.
> Investors were caught off guard after the publication of a release saying that Vinci had discovered an accounting error and had fired Chief Financial Officer Christian Labeyrie. The shares plunged 18 percent, the most in more than 17 years, before Bouquet said the report was false. Vinci will file a complaint about the incident, the spokesman said.
Meanwhile, some Spanish highways eventually got paid off and are becoming toll-free.
I presume too big to fail works everywhere!
Turns out, they were right, and in hindsight, privatization is a failure as far as the highway users are concerned.
But please, carry on with your factless dogma.
On the one hand, if true, all Bloomberg had to do was produce evidence; a single compromised server. They didn't. On the other hand, if the journalists fabricated the entire story, saying that all these big companies were hacked, why didn't anybody sue them? It was a major accusation! It just kinda...disappeared.
This might be the answer to you second question. No one seems to have taken the Bloomberg story to be true. Just went "that's dumb" and dropped it. In fact the only times I've ever seen it resurface is in a context to point out something negative about Bloomberg (like now), not the companies named in the article.
Sort of like the Elon Musk defamation case that just ended. Plaintiff didn't get anything because people didn't turn on him due to the accusation, they turned on Elon.
If it's not believed then you couldn't have suffered harm.
What exactly would they sue them for? Defamation and libel claims don't just require the defendant to be wrong, they have to have known or ought to have known that the claims were false. If Bloomberg could point to some outside source, anonymous or not, I don't see a way that Supermicro could meet the standard of proof necessary to sue them over it.
I agree it’s all very odd. I wonder if we’ll ever get the story behind the story.
If the story were true, under what circumstances could Bloomberg reports have come into possession of a compromised sever to satisfy this requirement?
> On the other hand, if the journalists fabricated the entire story
Journalists evaluate and report what they're told by sources. For instance: they don't do scientific experiments themselves, but rather interview scientists about their results and report their statements. Their quality control is to get multiple sources to corroborate each other.
Saying Bloomberg journalists "fabricated" the story is going too far. If it's false, what's likely is that either their sources were either mistaken or dishonest.
It was refuted, yes, but every company always does that, right up until they admit in a court settlement that the allegations were true all along. Despite the supposedly slanderous statements, none of the supposedly slandered companies has sued over the article, even though in several cases they suffered material impacts to their stock prices and financial results.
...But nothing.
Despite supposedly defamatory statements, nothing was done by any of the companies mentioned in the article.
Comments here have mention the Streisand effect as the reason for inaction, but the Streisand effect does not apply to defamation. The concept behind the Streisand effect is that efforts to censor information just result in greater dissemination. However, in a defamation lawsuit with potentially billions of dollars of damages at stake, you want greater dissemination of the defamatory statements, because that increases the payout at the end of the road. And because with enough money you can recover from the negative PR (see, e.g, Tylenol, Ford, Toyota, Tesla, BP, etc.).
I don't think there's much of any "evidence" to prove it and a hack like that is pretty.
Then again nobody ... did anything after that either and everyone responded kinda awkwardly about it.
I can't help but wonder if they got it dead wrong, but anyone clarifying or suing to prove otherwise would expose something else and so ... nobody talks?
I think about the kind of info we only get when lawsuits happen, and here the suing party could be losing more in collateral damage for just punishing a petty journal ?
Sure. What if the boards were hacked, but not by the Chinese? What if some company insiders knew? Just wildly speculating, but the response at the time seemed odd to me.
The silence following that whole debacle is deafening and probably very telling...
Deleted Comment
https://www.washingtonpost.com/opinions/2019/10/04/bloomberg...
Both Olson and Bloomberg had bad judgment here. A political appointee should not have made sarcastically anti-anti-Semitic statements, because he should have had the brainpower to know that in the Trump administration such statements would be taken at face value. And Bloomberg probably should have revised the article to add a paragraph about how a Trump appointee's anti-Semitic statements were actually anti-anti-Semitic in light of additional context that wasn't in the posts at the time they were made.
Also kinda reminds me of the lawsuit in Ohio against Facebook. A charter school ran ads, and messed up their attendance count, so other school districts are sueing Facebook trying to recover funds they thought should of went to their school districts instead, which seems like an interesting case but no updates on it in like 6 months, so not sure what the progress is on the case.
This isn't a freedom of speech issue since obviously they were free to say whatever they wanted, lies and misinformation included. This doesn't imply freedom from consequences.
Causing a company to lose 18% value because they couldn't be bothered to verify is negligence, incompetence, or malice (or a combination) not freedom of speech and it's only fair to receive a fine. Bloomberg is making a habit of such reporting.
Freedom of speech does indeed mean freedom from consequences for your speech - at least governmental consequences.
Deleted Comment
I think the first word of the title, France, is a giveaway here.
Deleted Comment
The headline should be updated to say they were fined by France.