Yahoo Board Member Patti Hart's Las Vegas Connections

Patti Hart
(photo from IGT)

Yahoo board members and parade of senior management have seemingly worked overtime to ruin a once proud firm's reputation. Their troubles began when founder Jerry Yang, with the strong backing of Google, thumbed his nose to Microsoft's friendly buyout proposal. That misjudgment cost Yahoo shareholders a bonanza. However, Yang maintained Yahoo's purity for a time. Meanwhile, Yahoo's performance continued to melt as Google cynically turned up its competitive heat. A new CEO, Carol Bartz, was brought in to change Yahoo's decline. The foul-mouthed (by all accounts) Bartz lasted awhile, until Yahoo's downward spin began to dangerously accelerate. A new CEO, Scott Thompson, was found and duly sworn in, partly to begin the mass layoffs everyone knew Yahoo needed to start. His major Yahoo board backer was Patti Hart, CEO of International Game Technology (IGT).

This week, the tech world tuned into the latest edition of the Yahoo soap opera. It appears Thompson misstated his academic credentials. He appeared to claim, and Yahoo asserted in documentation to the SEC, that he had obtained a computer science degree from an obscure Massachusetts college. A hostile Yahoo board member bothered to perform due diligence and discovered Thompson did not earn a computer science degree anyplace. As Thompson's de facto sponsor, Hall took the very public fall.

Si Redd (photo from Las Vegas Sun)

What's much more curious to me than Thompson's possible duplicity is Hall's background. IGT is a major player in the slot machine business. Its founder, Si Redd, is associated with the invention of video poker. Neither business is one for the faint of heart.

Inquiring minds wonder what Ms. Hart and her Nevada cohorts found so appealing about Yahoo. Clearly, Yahoo's international reach would have been a tempting target for a street-smart enterprise keen on international, Internet-based growth. Having a "family member," so to speak, on the board gave these sharp wits a tremendous, insider advantage. If any group understands the value of "early information," it's Las Vegas investors.

For a wickedly fascinating profile of Ms. Hart, read Sarah Klaphake Cords' piece in the December 2010 issue of Gaming Enterprise Management. For a mostly critical perspective on Hart's stacking IGT senior management with "her people," click to Las Vegas Review-Journal staffer Howard Stutz' column on Hart's hiring of IGT's chief financial officer.