In less than a year, Henry Niman says he went from the amateur web site host of "Links to Ligand" to the target of a troubling smear campaign.
Eight months ago, the Internet and Henry Niman were one more happy match made in cyberspace. The 49-year-old Pittsburgh biochemist, who helped found a company that was later merged into Ligand Pharmaceuticals, used the Internet for both investment research and communication with other small investors through his "Links to Ligand" web page. Inspired by the page he put together for his daughter's soccer team, Niman lovingly put together an extensive Web site on Ligand, including links to pharmaceutical trials, news releases, and analyst reports on the San Diego company. In addition, he was an active participant in on-line investment forums such as Silicon Investor, Yahoo! and the newsgroup misc.invest.stocks. The enthusiastic Niman argued persuasively and persistently for long-term investment in the company.
But subsequently, Niman has experienced the dark side of the Web – a side that includes forgery, harassment, and possible manipulation of Ligand stock.
Beginning last March, Niman started getting "flamed" or attacked in messages from other posters on web sites. That's somewhat par for the course in chat rooms. But then Niman says forged messages began to appear on Yahoo! under the moniker "Henry Niman, Ph.D." requesting child pornography. As months went by, the attacks got nastier, following Niman into the Usenet forum, misc.stocks.invest and stock chat room Raging Bull. Somebody joined Silicon Investor with a version of his name and identical biographical data, although SI canceled the account after being notified by Niman. Niman found himself under siege by groups of people with hard-to-trace pseudonyms and no history of posting in Ligand chat rooms. Unlike the prompt attention he got from SI, multiple complaints to Yahoo! had no effect.
"I think I sent them five different messages," Niman says of his attempt to stop the harassment on Yahoo! " I thought that part would be really easy and obvious to them. I gave them 30 examples."
Meanwhile, Ligand's stock and warrants kept dropping, although analysts and the company say there was no news that logically should have spurred such a downward spiral. On August 12, for example, Ligand closed on a $30 million merger with Seragen, which resulted in the creation of some 1.9 million shares of Ligand. But considering Ligand's market capitalization of approximately $370 million and 38 million outstanding shares of stock, that was a relatively small amount and there was no indication from the volume that those new shareholders were simply dumping Ligand.