It’s that time of the year again — here’s Business 2.0’s 101 Dumbest Moments in Business

After years of bombarding Web surfers with annoying pop-up ads, wireless camera maker X10 files for bankruptcy in October, listing debts of more than $10 million. Among the parties stiffed: AOL, Google, Yahoo, and AdvertisementBanners.com, which won $4 million in a lawsuit against X10 shortly before the bankruptcy filing.

That not enough for you? Read on.

We believe what we want to believe:

In February, Computerworld publishes an article in which “Abu Mujahid,” a Pakistani operative linked to al Qaeda, claims responsibility for releasing the Slammer virus. The magazine pulls the story three hours after it’s posted online. “Mujahid” is revealed to be Brian McWilliams, a freelance writer who created a fake website to lure gullible journalists.

Caught one!

We won! Now we can pay our McDonalds bill.

Finally closing the books on a 16-year-old lawsuit, an Asheville, N.C., court rules in favor of 165,000 people who paid $1,000 apiece to Jim and Tammy Faye Bakker’s Praise the Lord ministry for stays at a resort that was never built. Lawyers receive $2.5 million for litigating the case; plaintiffs end up with $6.54 each.

To be fair, $2.5M for 16 years isn’t a lot. And I see the “how stupid do you have do be to invest in that” defense didn’t work.

Cnl Atkins

In October, KFC “executive vice president for marketing and food innovation” Scott Bergren announces some innovative food-related marketing: the repositioning of fried chicken as health food in a series of new TV ads. “Consumers,” he says, “will be surprised to learn they can enjoy fried chicken as part of a healthy, balanced diet.” They are indeed surprised: After protests from consumer advocates, who note that the advertised bucket of fried chicken contains 3,090 calories, the ads are pulled.

Healthy and balanced in what universe?