Stewart defence bids to throw out securities fraud charge
Martha Stewart’s lawyer believes the most serious count against the style guru - securities fraud - should be tossed out before the jury considers the case.
US District Judge Miriam Goldman Cedarbaum said she would allow lawyer Robert Morvillo to argue for the dismissal. The hearing could be tomorrow, after the government rests its case against Stewart.
The securities fraud count accuses the homemaking mogul of trying to prop up the value of her company, Martha Stewart Living Omnimedia, by lying to investors about why she dumped ImClone Systems stock in December 2001.
The charge carries a maximum prison sentence of 10 years. The four other counts against Stewart carry five years each. Federal guidelines would dramatically reduce the sentence on any charge if Stewart were convicted.
Jurors were yesterday shown a bright-red chart of Martha Stewart Living Omnimedia stock that showed brief peaks in price after Stewart issued two statements in June 2002 denying wrongdoing in the ImClone investigation.
In both statements, Stewart denied receiving advance word on December 27, 2001, just before she dumped ImClone stock, that the US government would decline to review ImClone’s cancer-fighting drug.
But Stewart also insisted she and her stockbroker had a prior deal to sell ImClone when it fell below 60. The government contends that never happened, and that Stewart was tipped that ImClone CEO Sam Waksal was trying to sell.
