This blog normally concerns the rights and revenues of artists. Senator Ron Wyden of Oregon has consistently been on the wrong side of these issues. Wyden opposes the “Classics Act” that corrects what is essentially a typo in copyright law. A typo that allows multi-billion dollar digital services like Google, Spotify, Pandora and Sirius to withhold royalties to performers that recorded before 1972 (the year sound recording copyrights were federalized). Unfortunately due to biases built into the music industry before 1972 this means that African American artists are disproportionately harmed by this loophole. That is why the Oregon NAACP has called out Wyden on his opposition to the classics act.
Wyden has falsely characterized the bill as a windfall to record labels. He also falsely claimed to his constituents that performers would not receive any money from the Classics Act. The Senator either did not read the bill or is lying. The terms of the classics act are as plain as day.
So since the Senator is so concerned with unearned windfalls, let’s turn the table and look at his own families finances. Let’s see if perhaps the powerful Senator and his family benefitted from unearned windfalls.
What is up with this:
Wyden’s son Andrew Wyden went from interning at DE shaw (19 Billion in assets) to owning his own hedge fund in a matter of months. As the article notes David Shaw (Principle at D. E. Shaw) has been a frequent contributor to Sen Wyden and also supported his Super PAC:
But a D.E Shaw spokesperson assured Bloomberg, “Adam went through the same rigorous vetting and interview process as all other D.E. Shaw group interns.”
The reason observers might think otherwise is because David Shaw has donated thousands of dollars to Senator Wyden’s election and re-election campaigns in 2004 and 2010. Shaw and his wife each gave the maximum $4,800 each that they’re allowed to donate for any single election cycle, to Wyden.
Shaw also contributed $5,000 in 2010 to Holding Onto Oregon’s Priorities, a political action committee established by Wyden, according to Campaignmoney.com
Other articles report that Andrew Wyden (the junior) started with 3 million dollars. Who gives a 26 year 3 million dollars to run a hedge fund out of a Senators basement? It must be someone who knows the son very well. Perhaps a rich former employer like D.E. Shaw? To be clear I’m not definitively stating that D. E, Shaw gave the Andrew Wyden his stake. I have no evidence to support it. But the money came from somewhere. Both the senator and the son know where the money came from. They could clear this up. But if they continue to remain silent, I say it is fishy enough that it should be investigated by someone. This is above my pay grade, but here are some suggestions: Senate ethics? SEC? FEC? FBI? Any and all?
ESPECIALLY since Wyden the junior had an extraordinarily good first year. Up 90% in the first year. According to Absolute Return magazine:
Wyden’s best personal trade last year was an investment in IDT Corp. starting in February, when the Newark, New Jersey, telecommunications company traded at an average of $4.84 a share, he said. IDT now is at $23.90
Lucky bet? Could be. I mean the stock of many thinly traded telecommunications companies trade in a volatile manner. Especially if they they have patents or spectrum that are positively impacted by FCC decisions. Pop. But IDT is no ordinary telecommunications company. In fact it’s misleading to consider it a pure telecommunications play. Here are some highlights from their 2008 annual report ( I couldn’t find later annual reports):
There are three possible issues with IDT holdings. Senator Wyden is on the house Energy and Natural resources committee. IF (and that’s a big If), the Senator was privy to any information that would impact IDT’s two energy businesses (and hence stock price) what safeguards were in place to assure this kind of information didn’t go to his son? Fair question since his son’s hedge fun was operated out of the senators Washington DC townhouse. Second, the value of the wireless spectrum that IDT owned could potentially impacted by the Senators action or inaction. Wyden is no stranger to the wireless spectrum issues. He was instrumental in getting 3g spectrum freed up from the pentagon for use by commercial telecommunication companies. Advance knowledge of the senators action or inaction could materially affect value of IDT spectrum and hence the stock price of IDT.
To be clear. I have no evidence of wrongdoing, but there is something not quite right about letting a sitting senator’s son operate a hedge fund out of the senators home. It deserves further examination.
Finally I’ve heard the Senator is a fan of the movie The Big Lebowski. Might we remind him what “happens when you find a stranger in the Alps?”
See also this article