Sardar Biglari is stepping up his attacks on the board of Cracker Barrel Old Country Store by hiring a New York City law firm to comb through the records of the company's dealings with director and chairman-in-waiting Jim Bradford before and after he was named to the board last year.
In a letter to Cracker Barrel General Counsel and Secretary Michael Zylstra, Steve Wolosky, a partner at Olshan Frome Wolosky, says he has been asked by Biglari to investigate possible wrongdoing or mismanagement related to Bradford's appointment. Biglari first publicly raised the issue of Bradford's résumé early this week, saying that the company and CEO Sandy Cochran had repeatedly said the dean of the Owen Graduate School at Vanderbilt University had been CEO of a company listed on the New York Stock Exchange.
Company officials responded by saying that that statement was indeed incorrect — Bradford's tenure as CEO of AFG Industries began four years after the company was taken private — but that they had meant no harm. That response hasn't appeased Biglari, who is pushing for two board seats on next month's shareholders meeting, one bit.
"Biglari Holdings believes that the material inaccuracy in Cracker Barrel’s public statements and filings regarding Mr. Bradford’s experience creates significant doubt as to the thoroughness of the entire Board nomination process and oversight of the accuracy of the Company’s public filings and statements," Wolosky wrote.
In his letter — read the whole thing here — Wolosky gives Cracker Barrel officials five business days to let him know when and where the requested documents will be available for perusal. If the company doesn't respond, Biglari will assume it doesn't plan to follow the law and "will proceed accordingly."
Despite the back-and-forth headlines over Bradford's qualifications, shares of Cracker Barrel (Ticker: CBRL) have barely budged this week, suggesting shareholders aren't too worried about this issue or next month's shareholder meeting vote. They're down less than 1 percent since Friday (Oct. 5) afternoon, versus almost 2 percent for the Standard & Poor's 500. Year to date, Cracker Barrel is up about 30 percent.