At an age when most peers are well into retirement mode, Icahn, 78, shows little sign of easing into a sedentary lifestyle, let alone abating his role as one of Wall Street's preeminent shareholder activists.
In the past year, Icahn's been a high-profile troublemaker at several companies: fighting a buyout of Dell Computer, lobbying Apple to boost its stock repurchase plan, then pummeling eBay's corporate directors in a nasty proxy fight to unlock shareholder value by spinning off its PayPal division. And in a live smackdown seemingly more appropriate for the Jerry Springer Show than business cable channel CNBC, Icahn squared off with rival hedge fund manager Bill Ackerman over nutritional products marketer Herbalife.
While the brash billionaire's 53-year Wall Street career has been underscored by highly publicized verbal tussles, they've mostly been initiated and largely controlled by the New York-born, Ivy League-educated hedge fund manager himself, dating back to the 1970s, when he was a pioneer in corporate "greenmailing" – buying stock in undervalued companies, then selling stakes back at a premium.
But in denying a Wall Street Journal report that he's been targeted for insider trading along with professional golfer Phil Mickelson and golf course owner and Las Vegas gambler William "Billy" Walter, Icahn, for now, appears to be in hunker-down mode.
Icahn declined an interview with USA TODAY, but in a Monday e-mail statement, denied allegations that he had passed on stock tips to Walters, who the Journal said passed on information to Mickelson.
"We are always very careful to observe all requirements in all of our activities,'' Icahn said. "We believe that making inflammatory and speculative statements, especially when we have had an unblemished record! for 50 years, is completely irresponsible on the part of the Wall Street Journal."
Both Walters – an acquaintance of Icahn – and Mickelson – who says he has never met the former corporate raider – have denied any wrongdoing.
According to the Journal, the insider trading probe stems from stock trades involving several companies, including Dean Foods and Clorox. Icahn said in his email that he has never been involved in any way with Dean Foods. Icahn did amass a 9% stake Clorox in early 2011 before making a $10.2 billion hostile tender offer that summer. By December, Icahn abandoned his bid for the household products maker. (The Associated Press says the FBI and Securities and Exchange Commission are analyzing trades Mickelson and Walters made involving Clorox shares at the same time Icahn was mounting his takeover bid).
Wall Street observers say based on media reports, there's little evidence that Icahn was involved in insider trading.
"The government has to show that there was a breach of fiduciary duty – and Icahn wasn't a fiduciary or an insider at Clorox,'' says law professor John Coffee, director of Columbia University's Center on Corporate Governance. "The other possibility, and it's somewhat tenuous, is that he was misappropriating information from the hedge funds he was putting into this deal. But every day of the week, hedge funds tell each other of their plans."
Former federal prosecutor Douglas Burns agrees. "People pass on stock tips and rumors all the time,'' Burns tells CNBC. "Whatever Walters may have been told," stock tips and rumors are not insider trading, Burns says.
Ahead of Icahn's bid, there was heavy trading in Clorox stock options. Andrew Wilkinson, a market analyst at Interactive Brokers, says the July 2011 surge in Clorox call options represented an unusual wave of demand. "Traders get their teeth into these rumors," and jump in, Wilkinson says.
Wilkinson cautions that the Clorox option surge doesn't automatically sig! nal anyth! ing improper. "People see somebody else doing something, and they want a piece of it," he says. "For the sake of a few pennies on these (option) calls, I want a part of it."
Still, those who had inside information and bought Clorox calls ahead of Icahn's takeover bid would have been taking a major risk. "You're leaving a large footprint, and it's very likely you'll get caught," Wilkinson says.
Coffee notes that Icahn has always been "exceedingly careful" in his business dealings.
"I've watched him for 45 years,'' Coffee says. "It would be a dramatic departure for him to cross a legal line. He's constantly pushed the envelope, but he always stays within the boundaries of the law."
Some of Icahn's corporate targets haven't, however. In March, film and TV producer Lions Gate Entertainment settled an SEC complaint, paying $7.5 million and admitting wrongdoing when it blocked Icahn's 2010 hostile takeover bid.
Icahn followed up by calling Lion's Gate "Liar Gate."
Last month, Icahn publicly chided Warren Buffett, an equally famous but more genteel investment titan, after Buffett abstained from voting against an excessive executive compensation proposal at Coca-Cola. Buffett is among the soft drink marketer's largest shareholders.
"If a man of Warren Buffett's stature openly states he abstains from voting on plans he doesn't agree with because he 'loves' management and he doesn't want to 'express any disapproval,' how can we expect other board members in this country to voice their opinions, especially if they are opposed to the CEO's interest?''
Shares of Icahn's holding company, Icahn Enterprises, fell 4% to $98.29 Monday. The stock is up 126% over the past three years.
Contributing: Kevin McCoy in New York.
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