Whole Foods CEO Caught In Blogging Controversy

Jul. 11, 2007 (KGO) (KGO) -- The CEO of Whole Foods market finds himself in an embarrassing situation tonight. According to court documents, John Mackey went online under a pseudonym, and posted comments praising his company and blasting its rivals.

With more than $4 billion dollars in annual sales, Whole Foods is the natural foods leader, and it has a devoted following. One shopper went so far as to praise the grocery store chain on a Yahoo stock forum.

In one posting, Rahodeb wrote, "I love the company and I'm in for the long haul. I shop at whole foods, I own a great deal of its stock. I'm aligned with the mission and values of the company. Is there something wrong with this?"

Turns out, Rahodeb is actually the co-founder and CEO of Whole Foods, John Mackey. His online pseudonym is an anagram of his wife's name, Deborah.

Diane Osgood is vice president of Business for Social Responsibility.

Diane Osgood, Business for Social Responsibility: "People expect transparency and when you blow that expectation, you blow that trust. The people aren't going to trust you in whatever vehicle you choose to communicate. Via corporate publications, be it what you tell folks in the shops, that trust is blown."

Rahodeb's postings went on for nine years. The fact that it was Mackey was revealed only yesterday in court papers filed by the Federal Trade Commission.

The FTC is suing Whole Foods on anti-trust grounds for trying to buy another natural-foods grocer, Wild Oats. That company was the source of many of Rahodeb's postings.

In January of 2005, Rahodeb wrote, "Would whole foods buy oats? Almost surely not at current prices. What would they gain? Oats locations are too small.

All of this online deception isn't exactly new. Last year for instance, Wal-Mart received heavy criticism, when a web site apparently written by independent bloggers was actually designed by the retailer's pr agency.

Misha Cornes is with the interactive marketing agency, organic.

Misha Cornes, Organic: "I bet this is more common than we think and I think there are probably a lot of people high up in organizations who are engaging in this type of activity."

So far, Mackey has only responded on his whole foods blog. He makes no apologies. In fact Mackey accuses the FTC of trying to embarrass him and whole foods.

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