You’ve gotta wonder if he’s regretting it all now. The comeback, that is.
Lance Armstrong’s attempt to win an eighth Tour de France is not going nearly as smoothly as his seven victories. Aside from issues on the road that have completely taken him out of contention for the overall title, he’s dealing with repeated media reports on an investigation into his old United States Postal Service team.
And whether on the bike or in front of a microphone, Armstrong seems to have lost the finely tuned balance that saw him successfully fend off challengers, whether they were on the bike or in press row.
Armstrong told reporters at the start of Stage 10 that he never had any ownership in Tailwind Sports LLC, the entity that owned the U.S. Postal Service team, and that he was merely an employee like any other rider. “That’s completely untrue,” he said of reports he held an equity stake in Tailwind. “No ownership; none at all.”
That’s a highly relevant fact, because the investigation into the Postal years hinges in part on whether Tailwind Sports, the team’s owner, might have defrauded the federal government by using federal funds to support doping on the team. If proved in court, the riders might not be held criminally responsible for that but team officials and owners would.
(Although not primarily supported by tax dollars, the Postal Service is explicitly authorized in the U.S. Constitution and enjoys a federally mandated monopoly on regular mail service. Even since the 1970 Postal Reorganization Act, it is considered a government agency and is defined by the U.S. Code as a “legally independent establishment of the executive branch of the Government of the United States.”)
But as Bonnie Ford at ESPN and numerous other outlets have pointed out, that statement directly contradicts Armstrong’s own testimony in the SCA Insurance case in 2005. In his deposition there, Armstrong acknowledges owning 10 percent of Tailwind, although he professes to be unclear about when his ownership stake began.
Testimony by Bill Stapleton, Armstrong’s agent and the founder of Discovery team co-owner Capital Sports and Entertainment, also indicated Armstrong’s share of Tailwind was roughly 10 percent.
It was, by Armstrongian standards, a monumental slip-up. And Armstrong’s team was quick to try to manage the fallout.
In an e-mail statement, Armstrong’s attorney, Tim Herman, attempted to clarify the discrepancy, writing that while Tailwind’s board of directors decided to issue shares of Tailwind stock to Armstrong in 2004 and informed him of that plan, the stock award did not actually take place until December, 2007.
“Thus, when Lance was asked questions about it in 2005, he truthfully answered that he believed he was a small minority owner in Tailwind but did not know or understand the details,” Herman wrote.
If true, that’s a curious sequence of events.
For starters, Tailwind Sports disbanded the Discovery Channel team — its most profitable property — at the end of 2007, right when Armstrong reportedly received his stock. As of 2006, Tailwind’s client list included Discovery, the San Francisco Grand Prix (which did not run in 2006 as organizers faced allegations of skipping out on payments of $364,000 to the city) and a consulting agreement with USA Cycling.
At the August announcement that the Discovery team would dissolve, Armstrong said that Tailwind would shift into other sports. Armstrong’s spokesman, Mark Higgins, did not respond to a request for clarification on what projects Tailwind pursued in 2008. Not two and a half years later, Tailwind appears to be gone.
Tailwind, incorporated in Maryland in 2001, today has zero public presence and is listed by the Maryland Department of Assessments as forfeited, meaning the business’ existence was terminated by the state for a delinquency. A separate incorporation with the California Secretary of State, for Tailwind Sports Corporation, lists the same Austin, Texas street address as Capital Sports and Entertainment, with its status as “surrender” and a filing date of July 1, 2002.
A quick view of Capital Sports and Entertainment’s portfolio shows no other sports-based clients (a one-time bit player in representing professional football players, CSE no longer lists that business in its stable; six of its 10 listed projects or partners involve Armstrong in some fashion.)
So if Armstrong really was granted Tailwind stock in December of 2007, just as the company’s most profitable era was at a close and its days as a corporate entity altogether were numbered, then on an investment level that’s about like taking a long stake in BP on April 21. That would be an uncharacteristic lapse for Armstrong, who once bragged of his own financial savvy that he gave Stapleton investment advice.
If so, the truth — that Armstrong is extremely blase in his business affairs — clashes with the image of Armstrong and Stapleton as shrewd businessmen. The three-year period to close a simple stock offering is of a piece with another much-discussed (and controversial) transaction of similar Methuselah-like lifespan: the three years to finalize a promised $100,000 donation to the UCI, the existence of which was finally confirmed last week by UCI president Pat McQuaid.
In any case, investigators with the power to subpoena documents as well as personal testimony should be able to get to the bottom of exactly who owned what percentage of Tailwind and when.
But increasingly, Armstrong’s public statements have sounded strangely shrill. When the Wall Street Journal published its initial story reporting leaked e-mails by Floyd Landis accusing Armstrong and others of doping, Armstrong responded, in part, by questioning Landis’ mental state and publishing a series of e-mails from Landis and others that he claimed would expose Landis’ threats. The e-mails are no longer available on the RadioShack team web site.
When the Journal published its second expose, Armstrong referred to the allegations as sour milk. His attorney, Tim Herman characterized the Journal’s story as “Garbage in, garbage out,” and based on “improper leaks and discredited innuendo.”
But the Journal story noted that three other former Postal riders the paper spoke with had confirmed there was doping on the team while Lance was team leader, and one of them confirmed doping himself.
On the bike, Armstrong has been similarly shaky. In seven Tour wins, Armstrong crashed, to my memory, just twice and often managed amazing evasions of others’ crashes. In Wednesday’s 10th stage, the pack passed the spot where Armstrong memorably off-roaded across a field to avoid Joseba Beloki’s horrifying crash in 2003.
But in the 2010 edition, on Stage 8 alone, Armstrong went down after just 6km, then caused one crash himself at a crucial moment in the race before getting caught up in a hapless third one when two Euskaltel riders bungled a musette exchange in front of him. Five years ago, Armstrong didn’t get caught in any crashes; now he can’t get out of his own way.
You wonder if it’s a metaphor.
The Armstrong of five years ago would not so artlessly have denied something that can be so easily proved with documents that are on file with the states of Maryland and California.
And perhaps the press at the Tour will ask him about his lax financial housekeeping, or his seeming inability on Wednesday to remember who were key Tailwind officials other than Thom Weisel and Eddie Boryesewicz, who was last with the team in 1998, Lance’s first year on the team.
One name that might jog the memory: Mark Gorski, Tailwind’s co-founder and general manager until just prior to the 2003 Tour, which was Armstrong’s fifth win and sixth year on the team.
Armstrong’s fresh stumbles come amid heightened scrutiny of the legal case that resulted out of Landis’ allegations. The NY Times reported yesterday that federal subpoenas have been issued to potential witnesses, and the NY Daily News, in a story reporting that Postal sponsor Trek Bicycles had been served, mentioned that the subpoenas had originated from a grand jury.
If true, that would indicate the investigation is moving swiftly, since federal grand juries compel and consider evidence to determine whether to recommend a criminal indictment.
Speaking to reporters at the Tour, Armstrong also spoke critically of the investigation, asking rhetorically if the American people “feel like this is a good use of their tax dollars?” He said that while he was respectful of the process, he would only cooperate in a “legitimate and credible and fair investigation,” not a “witch hunt,” before finishing, “I’ve done too many good things for too many people.”
Armstrong has sometimes been accused of using his work with his cancer foundation as a shield against criticism. That is a charge I’ve never made. But I’ve also never heard him invoke that substantive and important legacy in such a bold fashion as he did today. And he seems to be willfully unaware that this is a federal criminal investigation; his interest in participating is immaterial.
Armstrong’s work on behalf of fighting cancer isn’t the issue here. The issue is whether or not Floyd Landis is telling the truth and, if he is, whether Lance Armstrong knowingly used Postal Service money to dope to win the Tour de France and enrich himself, thus defrauding the federal government.
I don’t know what’s up with Lance Armstrong these days, on the bike or off. But I wonder if he doesn’t wake up some days and wish he’d just stayed retired.
Le Tour 2010
Top images from the three-week cycling showcase in France.
2010 Tour de France