Selling ImClone Stock Case of Martha Stewart

The next day Stewart forwarded a copy of this email to her daughter, Alexis Stewart. On August 12, 2002, the grand venire investigating the case issued a subpoena to Martha Stewart Living Omnimedia (MSLO) seeking documents relating to the sale of ImClone stock and all desktop and laptop computers utilize by Stewart and several other MSLO employees. MSLO reached a compromise with the Government, agreeing to hand over the computers and the Government agreeing not to examine the computers until MSLO identified the files pertinent to the ImClone sale, because they did not wish to give the government access to all their crease files. They also handed over files under the same conditions. They submitted logs of documents, and set that the emails from Stewart to her attorney and her daughter were privileged and neither appeared on the logs. However, MSLO unwittingly omitted the June 24 email to Stewart's daughter from the privileged list and it was make available to the Government in the hard copy logs. As a result, the grand jury returned an indictment on June 4, 2003 charging Stewart with conspiracy, balk of justice, making false statements, and securities fraud.

Shortly afterwards, an Assistant United States Attorney, not knowing of the agreement between MSLO and the Government, discov

http://www.findlaw.com/hdocs/docs/mstewart/usmspb122903

Throughout the trial, the Government portrayed Stewart as a liar who had conspired with her stockbroker to cover up that she had sold her ImClone stock in December, 2001 after learning that Waksal and his two daughters were marketing thousands of shares they held in the federation (Lazaroff, Skertic and Countryman, 2004). Waksal was convicted in 2003 of insider trading and is serving a seven-year sentence in a federal prison. They charged that Stewart learned about the Waksals' selling their stock through conversations with Bacanovic's assistant, Douglas Faneuil.

Stewart convicted on all charges. 92004). CNNMONEY. Retrieved

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