Playing Texas Drop ‘Em

While there are a number of stories floating around about the topping out of the poker craze, my favorite current poker story is the one involving poker legend Doyle Brunson’s bizarre $700mm bid for WPT (the World Poker Tour).

After very publicly putting the bid on the table earlier this year, and then watching the stock run up, Brunson instructed his representatives to make themselves scarce. They didn’t respond to curious sorts at the WPT, and the bid eventually ran out. Meanwhile WPT stock tumbled, costing holders millions.

Call it Texas Drop ’em, and it is, to be sure, a curious investment technique — a view to which the Securities & Exchange Commission subscribes:

The Commission is formally investigating whether Brunson’s offer and its publication violated federal securities laws, including the antifraud provisions of Sections 10(b) and 14(e) of the Securities Exchange Act of 1934. As part of its investigation, the Commission’s staff subpoenaed documents and testimony from Chesnoff and Henry. However, Brunson, who has invoked his Fifth Amendment right against self-incrimination and declined to testify in the investigation, directed the Goodman attorneys to withhold certain documents and not to testify on critical aspects of the offer, under the attorney-client privilege and work product doctrine.