Carson Block has a new short, and his reasoning is super creepy

Muddy Waters, the firm founded by noted short-seller Carson Block, is short St. Jude Medical Inc.The stock is down almost 7% on the news.The firm says it's shorting St. Jude because its pacemakers are faulty and susceptible to cyberattacks.In short, your heart could get hacked.From Muddy Waters' report (emphasis ours):"There is a strong possibility that close to half of STJ's revenue is about to disappear for approximately two years. STJ's pacemakers, ICDs, and CRTs mightand in our view, shouldbe recalled and remediated. (These devices collectively were 46% of STJ's 2015 revenue.) "Based on conversations with industry experts, we estimate remediation would take at least two years. Even lacking a recall, the product safety issues we present in this report offer unnecessary health risks and should receive serious notice among hospitals, physicians and cardiac patients."We have seen demonstrations of two types of cyber attacks against STJ implantable cardiac devices ('Cardiac Devices'): a 'crash' attack that causes Cardiac Devices to malfunctionincluding by apparently pacing at a potentially dangerous rate; and, a battery drain attack that could be particularly harmful to device dependent users. Despite having no background in cybersecurity, Muddy Waters has been able to replicate in-house key exploits that help to enable these attacks."St. Jude, for its part, stands by its products."The allegations are absolutely untrue," said Phil Ebeling, Chief Technology Officer in a statement following Muddy Waters' report. "There are several layers of security measures in place. We conduct security assessments on an ongoing basis and work with external experts specifically on Merlin@ home and on all our devices."We should note that St. Jude is in the midst of being acquired by Abbott Labs for $25 billion, and in a statement Abbott said the devices Muddy Waters is slamming is a reason it's interested in St. Jude."St. Jude Medical's strong positions in heart failure devices, atrial fibrillation and cardiac rhythm management complement Abbott's leading positions in coronary intervention and transcatheter mitral repair," the statement said.The deal is expected to take place in the fourth quarter, pending regulatory issues.Read Muddy Waters' full research report here Join the conversation about this storyNOW WATCH: MALCOLM GLADWELL: 'Anyone who gives a single dollar to Princeton has completely lost their mind
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