The Five Dumbest Things on Wall Street This Week

3. Compuware Is the Love?

Speaking of getting an earful, the research lab got a lot of angry mail this week responding to our story about the lawsuit that software firm Compuware (CPWR Quote) filed against Moody's Investors Service.

As you may recall, we made much mirth of Compuware's complaint, which came in response to Moody's August 2002 downgrade of Compuware's bank credit facility to junk status. We found particularly ludicrous Compuware's allegation that Moody's defamed Compuware by downgrading Compuware but not fellow software company Computer Associates (CA Quote).

"Idiots!" proclaimed multiple correspondents. "You completely missed the point!" What we overlooked, said the multitudes, was that Compuware had, in fact, no money borrowed under the bank credit facility. The loan was all paid up. If junk status implies risk of default -- which it does -- how could there be a risk of Compuware's not paying back money that it hadn't even borrowed?

Good point, we thought. So we called up Moody's to chat over the merits of the case.

A Moody's spokeswoman said the company had done exactly what it was supposed to do. "We performed our role, which to deliver to investors an independent assessment of a company's future creditworthiness," said the spokeswoman. "What matters is the company is asked for a bank loan rating -- a rating on a line of credit. And until the line of credit is terminated, Moody's will render an opinion on the creditworthiness of the company."

A Moody Response

So there. And even if you disagree, we still stand by our first point: You can't get out of a punishment by arguing that someone else deserves it more. Don't believe us? Well, then, the next time you get pulled over for speeding, tell the policeman writing up the ticket that everybody else was speeding, too. Just see what he says.

4. On A Clear Day, You Can See for Evergreen

Speaking of twisted court proceedings, the Research Lab has an update on an insider trading case that may be less inside than we previously reported.

Back in October, to jog your memory, we discussed the odd situation at audio/video distribution company DG Systems (DGIT Quote). Here was a company whose chairman, Scott Ginsburg, had been found guilty of insider trading, based on his activities at Evergreen Media, a company he had headed before joining DG Systems.