Berkowitz' Scathing Insider's Report On St. Joe Management (JOE)

After maintaining a strong bullish position on St. Joe (NYSE: JOE) and even joining the company's board, Bruce Berkowitz recently resigned from the board within weeks and has changed his mind on the quality of management at St. Joe. Berkowitz appeared today on CNBC to provide some color on his resignation, as well as his opinion on the company going forward.

Berkowitz, founder and CIO of Fairholme Capital Management, said that he had fundamental disagreements with St. Joe management that could not be resolved. Seemingly outraged, Berkowitz exclaimed, "Is this a New York Stock Exchange company?"

Berkowitz says that St. Joe management must become open, transparent and accountable. Berkowitz says that CEO compensation at St. Joe (somewhere near $20M over three years) is far too much. Berkowitz confirms that St. Joe's top executives have made tens of millions in compensation. These figures do not pass Berkowitz' "pay for performance" test. Berkowitz says that there has been little connectivity between company performance and CEO compensation at St. Joe.

Berkowitz resisted saying some key points of insider info, but his vocal tone seemed to indicate that Berkowitz had some serious concerns with St. Joe management that could not be publicly disclosed.

Berkowitz has been battling over the value of St. Joe ever since David Einhorn spoke at the Value Investing Conference and put a valuation on St. Joe at approximately $7/share due to poor cash flow.

Berkowitz also commented on the upcoming St. Joe shareholder vote. "It's just an absolute travesty how much this is going to cost the shareholders of St. Joe."

Berkowitz' most famous quote about the value of St. Joe came from a statement to Reuters in 2010: "I'd buy the whole company if I could. If we were able, we would buy the whole company." While Berkowitz is still a bull on St. Joe overall, shareholders are somewhat concerned that Berkowitz' insider's review of management was not more positive.

(There were no immediate stock movements in St. Joe stock immediately following Berkowitz' CNBC appearance.)