Its trading around 10....
Martha Stewart shares plunge after resuming trading
March 05, 2004 3:52:00 PM ET
NEW YORK, March 5 (Reuters) - Shares of Martha Stewart
Living Omnimedia Inc. (N:MSO) fell by more than 25 percent when
they resumed trading after being halted earlier as news emerged
that a jury found Stewart guilty of lying to investigators.
The stock, which fluctuated wildly on Friday on speculation
over the jury verdict and at one point reached as high as
$16.75 in trading on the New York Stock Exchange, fell to as
low as $10.50 when the shares resumed trading late in the day.
The shares closed at $14.03 on Thursday.
Martha Stewart shares plunge after resuming trading
March 05, 2004 3:52:00 PM ET
NEW YORK, March 5 (Reuters) - Shares of Martha Stewart
Living Omnimedia Inc. (N:MSO) fell by more than 25 percent when
they resumed trading after being halted earlier as news emerged
that a jury found Stewart guilty of lying to investigators.
The stock, which fluctuated wildly on Friday on speculation
over the jury verdict and at one point reached as high as
$16.75 in trading on the New York Stock Exchange, fell to as
low as $10.50 when the shares resumed trading late in the day.
The shares closed at $14.03 on Thursday.
Here are the government’s charges against Martha Stewart and former stockbroker Peter Bacanovic:
Martha Stewart
• Conspiracy
• False statements
• Obstruction of justice
• Securities fraud
Peter Bacanovic
• Conspiracy
• False statements
• Making and using false documents
• Perjury
• Obstruction of justice
The maximum penalty for each count is five years in prison and a $250,000 fine. If convicted, both are likely to get far lighter penalties than the maximum under federal sentencing guidelines.(CNBC)
Martha Stewart
• Conspiracy
• False statements
• Obstruction of justice
• Securities fraud
Peter Bacanovic
• Conspiracy
• False statements
• Making and using false documents
• Perjury
• Obstruction of justice
The maximum penalty for each count is five years in prison and a $250,000 fine. If convicted, both are likely to get far lighter penalties than the maximum under federal sentencing guidelines.(CNBC)
Martha Stewart guilty of all counts
By Erin McClam, Associated Press, 3/5/2004
NEW YORK (AP) -- Martha Stewart was convicted Friday of obstructing justice and lying to the government about a superbly timed stock sale, a devastating verdict that probably means prison for the woman who epitomizes meticulous homemaking and gracious living.
The jury of eight women and four men deliberated three days before convicting Stewart of all counts against her. The charges carry up to 20 years in prison, but Stewart will almost certainly get much less than that under federal guidelines at her June 17 sentencing.
Her former stockbroker, Peter Bacanovic, 41, was convicted on all but one count against him, filing a false document.
Stewart, 62, grimaced as each count against her was read. Her eyes appeared to widen slightly. Her daughter, Alexis Stewart, was in tears.
"Maybe it's a victory for the little guys who lose money in the market because of these kinds of transactions," said juror Chappell Hartridge, of the Bronx.
An hour before the verdict, Stewart, Bacanovic and their lawyers arrived in the courtroom. It wasn't until about 3 p.m., after an hour of nervous energy, that the judge entered the courtroom and the verdicts were read.
Stewart spent most of her last hour before the verdict checking her watch and twirling a pen in her fingers. She later released a statement promising an appeal.
"I believe in the fairness of the judicial system and remain confident that I will ultimately prevail," she said.
Trading in her company, Martha Stewart Living Omnimedia, plunged when it began trading again after the verdict. The shares had been halted for the verdict, after rising sharply on word that the jury had reached a decision.
The uber-homemaker left the courtroom with a somber expression, speaking to no one at the defense table before bolting to a holding room away from the media.
Stewart remained mum during the trial, too, opting not to take the witness stand to present her version of the events. Juror Hartridge said he had hoped to see Stewart testify.
"I would have liked to have heard from her," Hartridge said. "I would have loved to have heard the other side of the story."
One Stewart supporter on the courthouse steps clutched a neon-yellow sign reading, "FREE MARTHA," as other backers of the multimillionaire cheered.
Stewart and Bacanovic must report to a probation office within a week for processing. A spokesman for federal prosecutors said he was unsure how far each defendant's prison term could be reduced under sentencing guidelines.
The charges centered on why Stewart dumped about $228,000 worth of ImClone Systems stock on Dec. 27, 2001, just a day before it was announced that the Food and Drug Administration had rejected ImClone's application for approval of a cancer drug, an announcement that sent ImClone's stock plummeting.
Stewart and Bacanovic claimed they had a standing agreement to sell when the price fell below $60. But the government contended that was a phony cover story and that Stewart sold because she was tipped by her broker that ImClone CEO Sam Waksal was frantically trying to dump his own holdings.
Waksal later admitted selling his stock based on advance word of the FDA decision. He is serving seven years in prison for insider trading.
Stewart, who averted more than $51,000 in losses by selling when she did, was not charged with insider trading; instead, she and her broker were accused of lying about the transaction and altering records to support the alleged cover story.
With her conviction, the government may press to have her removed from the board of her company. She stepped down as chief executive after being indicted last summer but remains as chief creative officer.
The verdict jeopardizes the media empire that Stewart carefully built over the years in becoming the nation's premier homemaker -- an image she put forth by way of magazines, TV programs and everything from cookie cutters and garlic presses to bedsheets and pillows. Marketing experts have said that the company is so closely tied to her name and face that the effect could be devastating.
Shares of Martha Stewart Living Omnimedia plunged 23 percent after the verdict was announced, down $3.17 at $10.86. The stock had risen 16 percent before the verdict as investors bet on whether she would be acquitted. The New York Stock Exchange halted the shares at 3:02 and lifted the hold about half an hour later.
Stewart was easily the most recognizable face in the government crackdown on corporate crime that began with the collapse of Enron in 2001. Stewart's supporters claim she was being targeted because of her celebrity status.
The government's star witness was Douglas Faneuil, a former Merrill Lynch & Co. assistant who said he passed the tip about Waksal to Stewart on orders from his boss, Bacanovic. Faneuil said that when he told Bacanovic about a flurry of selling by the Waksal family that morning, Bacanovic blurted: "Oh my God, get Martha on the phone."
He also said Bacanovic pressured him to lie about the transaction.
Faneuil "was very important," Hartridge said. "He was really the foundation."
Marc Powers, one of Faneuil's lawyers, said his client was looking forward to resuming his normal life.
"Doug had no interest in the outcome. ... We had no interest in whether or not this case came to court. His conscience told him it was the right to do."
Prosecutors also contended Bacanovic doctored a worksheet of Stewart's portfolio after the fact by making the notation "(at)60" next to her ImClone stock. A forensics expert with the Secret Service testified that the mark was made in a different ink.
In addition, Stewart's personal assistant testified Stewart altered a computer log of a Dec. 27, 2001, message from Bacanovic, then immediately told her to restore the log to its original wording.
Also, a longtime Stewart friend, Mariana Pasternak, testified Stewart confided that she had known the Waksals were selling. Pasternak said Stewart added: "Isn't it nice to have brokers who tell you those things?"
But Pasternak admitted on cross-examination that the remark may have been something she herself thought, not something Stewart said.
In closing arguments, prosecutor Michael Schachter said the story about the arrangement to sell ImClone at $60 was "phony," "silly" and "simply an after-the-fact cover story." He said Stewart and her broker "left behind a trail of evidence exposing the truth about Martha Stewart's sale and exposing the lies they would tell."
For its part, the defense tried to discredit Faneuil as an admitted drug user and a liar. When the scandal broke, he initially backed up his boss, but later pleaded guilty to a misdemeanor, saying he had received an extra week of vacation and a free airline ticket for keeping his mouth shut.
Stewart did not testify, and her lawyers called only one witness during a defense that lasted less than an hour.
In closing arguments, defense attorney Robert Morvillo said that the conspiracy as outlined by the government was too sloppy to be true and urged the jury to let Stewart get back to "improving the quality of life for all of us."
"If you do that," he said, echoing Stewart's slogan, "it's a good thing."
Stewart could have faced even more prison time, but the judge threw out the most serious charge -- a securities fraud count that alleged she deceived investors in her own company when she publicly declared her innocence in the scandal. The judge had referred to the charge as "novel."
At times, the trial seemed more fodder for gossip columns than the financial pages. Stewart's arrival each day was chronicled by a barrage of photographers and camera crews, with the tabloids taking careful note of her expensive handbags and stylish heels. Celebrities Rosie O'Donnell, Bill Cosby and Brian Dennehy all showed up in court in support of Stewart.
Stewart had a reputation before the trial as a ruthless businesswoman, and in court she was portrayed as rude, insulting, demanding and cheap. According to testimony, she once threatened to take her business elsewhere because she did not like her brokerage's telephone hold music.
wil.
By Erin McClam, Associated Press, 3/5/2004
NEW YORK (AP) -- Martha Stewart was convicted Friday of obstructing justice and lying to the government about a superbly timed stock sale, a devastating verdict that probably means prison for the woman who epitomizes meticulous homemaking and gracious living.
The jury of eight women and four men deliberated three days before convicting Stewart of all counts against her. The charges carry up to 20 years in prison, but Stewart will almost certainly get much less than that under federal guidelines at her June 17 sentencing.
Her former stockbroker, Peter Bacanovic, 41, was convicted on all but one count against him, filing a false document.
Stewart, 62, grimaced as each count against her was read. Her eyes appeared to widen slightly. Her daughter, Alexis Stewart, was in tears.
"Maybe it's a victory for the little guys who lose money in the market because of these kinds of transactions," said juror Chappell Hartridge, of the Bronx.
An hour before the verdict, Stewart, Bacanovic and their lawyers arrived in the courtroom. It wasn't until about 3 p.m., after an hour of nervous energy, that the judge entered the courtroom and the verdicts were read.
Stewart spent most of her last hour before the verdict checking her watch and twirling a pen in her fingers. She later released a statement promising an appeal.
"I believe in the fairness of the judicial system and remain confident that I will ultimately prevail," she said.
Trading in her company, Martha Stewart Living Omnimedia, plunged when it began trading again after the verdict. The shares had been halted for the verdict, after rising sharply on word that the jury had reached a decision.
The uber-homemaker left the courtroom with a somber expression, speaking to no one at the defense table before bolting to a holding room away from the media.
Stewart remained mum during the trial, too, opting not to take the witness stand to present her version of the events. Juror Hartridge said he had hoped to see Stewart testify.
"I would have liked to have heard from her," Hartridge said. "I would have loved to have heard the other side of the story."
One Stewart supporter on the courthouse steps clutched a neon-yellow sign reading, "FREE MARTHA," as other backers of the multimillionaire cheered.
Stewart and Bacanovic must report to a probation office within a week for processing. A spokesman for federal prosecutors said he was unsure how far each defendant's prison term could be reduced under sentencing guidelines.
The charges centered on why Stewart dumped about $228,000 worth of ImClone Systems stock on Dec. 27, 2001, just a day before it was announced that the Food and Drug Administration had rejected ImClone's application for approval of a cancer drug, an announcement that sent ImClone's stock plummeting.
Stewart and Bacanovic claimed they had a standing agreement to sell when the price fell below $60. But the government contended that was a phony cover story and that Stewart sold because she was tipped by her broker that ImClone CEO Sam Waksal was frantically trying to dump his own holdings.
Waksal later admitted selling his stock based on advance word of the FDA decision. He is serving seven years in prison for insider trading.
Stewart, who averted more than $51,000 in losses by selling when she did, was not charged with insider trading; instead, she and her broker were accused of lying about the transaction and altering records to support the alleged cover story.
With her conviction, the government may press to have her removed from the board of her company. She stepped down as chief executive after being indicted last summer but remains as chief creative officer.
The verdict jeopardizes the media empire that Stewart carefully built over the years in becoming the nation's premier homemaker -- an image she put forth by way of magazines, TV programs and everything from cookie cutters and garlic presses to bedsheets and pillows. Marketing experts have said that the company is so closely tied to her name and face that the effect could be devastating.
Shares of Martha Stewart Living Omnimedia plunged 23 percent after the verdict was announced, down $3.17 at $10.86. The stock had risen 16 percent before the verdict as investors bet on whether she would be acquitted. The New York Stock Exchange halted the shares at 3:02 and lifted the hold about half an hour later.
Stewart was easily the most recognizable face in the government crackdown on corporate crime that began with the collapse of Enron in 2001. Stewart's supporters claim she was being targeted because of her celebrity status.
The government's star witness was Douglas Faneuil, a former Merrill Lynch & Co. assistant who said he passed the tip about Waksal to Stewart on orders from his boss, Bacanovic. Faneuil said that when he told Bacanovic about a flurry of selling by the Waksal family that morning, Bacanovic blurted: "Oh my God, get Martha on the phone."
He also said Bacanovic pressured him to lie about the transaction.
Faneuil "was very important," Hartridge said. "He was really the foundation."
Marc Powers, one of Faneuil's lawyers, said his client was looking forward to resuming his normal life.
"Doug had no interest in the outcome. ... We had no interest in whether or not this case came to court. His conscience told him it was the right to do."
Prosecutors also contended Bacanovic doctored a worksheet of Stewart's portfolio after the fact by making the notation "(at)60" next to her ImClone stock. A forensics expert with the Secret Service testified that the mark was made in a different ink.
In addition, Stewart's personal assistant testified Stewart altered a computer log of a Dec. 27, 2001, message from Bacanovic, then immediately told her to restore the log to its original wording.
Also, a longtime Stewart friend, Mariana Pasternak, testified Stewart confided that she had known the Waksals were selling. Pasternak said Stewart added: "Isn't it nice to have brokers who tell you those things?"
But Pasternak admitted on cross-examination that the remark may have been something she herself thought, not something Stewart said.
In closing arguments, prosecutor Michael Schachter said the story about the arrangement to sell ImClone at $60 was "phony," "silly" and "simply an after-the-fact cover story." He said Stewart and her broker "left behind a trail of evidence exposing the truth about Martha Stewart's sale and exposing the lies they would tell."
For its part, the defense tried to discredit Faneuil as an admitted drug user and a liar. When the scandal broke, he initially backed up his boss, but later pleaded guilty to a misdemeanor, saying he had received an extra week of vacation and a free airline ticket for keeping his mouth shut.
Stewart did not testify, and her lawyers called only one witness during a defense that lasted less than an hour.
In closing arguments, defense attorney Robert Morvillo said that the conspiracy as outlined by the government was too sloppy to be true and urged the jury to let Stewart get back to "improving the quality of life for all of us."
"If you do that," he said, echoing Stewart's slogan, "it's a good thing."
Stewart could have faced even more prison time, but the judge threw out the most serious charge -- a securities fraud count that alleged she deceived investors in her own company when she publicly declared her innocence in the scandal. The judge had referred to the charge as "novel."
At times, the trial seemed more fodder for gossip columns than the financial pages. Stewart's arrival each day was chronicled by a barrage of photographers and camera crews, with the tabloids taking careful note of her expensive handbags and stylish heels. Celebrities Rosie O'Donnell, Bill Cosby and Brian Dennehy all showed up in court in support of Stewart.
Stewart had a reputation before the trial as a ruthless businesswoman, and in court she was portrayed as rude, insulting, demanding and cheap. According to testimony, she once threatened to take her business elsewhere because she did not like her brokerage's telephone hold music.
wil.
<BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>Martha Stewart was convicted Friday of obstructing justice and lying to the government about a superbly timed stock sale, a devastating verdict that probably means prison for the woman who epitomizes meticulous homemaking and gracious living.
The jury of eight women and four men deliberated three days before convicting Stewart of all counts against her. The charges carry up to 20 years in prison, but Stewart will almost certainly get much less than that under federal guidelines at her June 17 sentencing <HR></BLOCKQUOTE>
Looks like some jail time, but not anywhere near maximum allowable by law. Not to mention appeals.
wil.
The jury of eight women and four men deliberated three days before convicting Stewart of all counts against her. The charges carry up to 20 years in prison, but Stewart will almost certainly get much less than that under federal guidelines at her June 17 sentencing <HR></BLOCKQUOTE>
Looks like some jail time, but not anywhere near maximum allowable by law. Not to mention appeals.
wil.
she will likely get 24-36 months, they will probably run the charges concurrent which means together not seperatly. If she had 4 charges that all range from 12-36 months they will take the most serious charge give her the prision time and include the other 3 charges under the one she will serve time on. unfortunatly i'm an expert in federal guidlines.
I ain't defending her but she should sue her lawyer for incompetence. His statement of "Let her improve the quality of life for all of us" has to be the most arrogant statement ever uttered on behalf of a defendant ever.
Like I (or any of you in this forum) really depend on Martha for lifestyle tips.
Like I (or any of you in this forum) really depend on Martha for lifestyle tips.
The news just said that from the stocks high today before the verdict, to the low that it dropped to afterwards, she lost 180 million dollars on paper...all for trying to scalp a few points off of 5000 shares worth a total of 200 dimes. What did she save by acting illegally? 20 dimes, maybe 30 or 40 at the most. Now, she not only is looking at a loss of over 200 million; she might get jail time as well. I can't believe she'd even worry about something like that dogshit stock.
She never dreamed she could go to jail...its really the ultimate show of greed...more money than she could ever spend and now this..let her make muffins for 'Bertha' for the next 3 years for being that dumb!
She is already posturing for jail " I will stand up for what I believe"..."I did nothing wrong" Take it like big girl Martha!
She is already posturing for jail " I will stand up for what I believe"..."I did nothing wrong" Take it like big girl Martha!
