Martha Stewart Receives Sentence
By ERIN McCLAM, AP
Update: Martha Stewart sentenced to five months in prison for stock scandal. Details to come.
NEW YORK (July 16) - Martha Stewart arrived at a federal courthouse Friday to learn whether the stock-trading scandal that tarnished her empire of gracious living would land her in prison.
Stewart, dressed simply in a black pantsuit, showed no emotion as she strode briskly through a media horde. Supporters applauded and one shouted, ''Hold your head high, Martha!''
Legal experts predicted U.S. District Judge Miriam Goldman Cedarbaum would sentence Stewart to 10 to 16 months in prison for lying about a stock sale.
In the event of a prison sentence, lawyers for Stewart, 62, were expected to ask Cedarbaum to allow her to remain free while she appeals her conviction. The judge also could allow Stewart to spend half her sentence at a halfway house or confined to her home.
In the final weeks before Stewart's sentencing, hundreds of well-wishers sent letters to the judge asking for mercy.
''I am alone now with my pets,'' a woman named Ruth Ritter wrote to the judge in careful script. ''Just seeing Martha doing her crafts, cooking, gardening, was a great comfort to me.''
From Springfield, Ohio, four middle-school cooks and a custodian wrote: ''Martha Stewart has been an inspiration for women across the nation. ... A hardworking, delightful character that shares her creative ideas with everyday people like us.''
Former Merrill Lynch & Co. stockbroker Peter Bacanovic, who was convicted along with Stewart of lying about the 2001 stock sale, was scheduled to be sentenced later Friday.
It was Dec. 27, 2001, when Stewart, in a brief phone call from a Texas tarmac on her way to a Mexican vacation, sold 3,928 shares of ImClone Systems Inc., a company run by her longtime friend Sam Waksal.
Prosecutors alleged that Bacanovic, 42, ordered his assistant to tip Stewart that Waksal was trying to sell his shares. ImClone announced negative news the next day that sent the stock plunging. Stewart saved $51,000.
Stewart and Bacanovic always maintained she sold because of a preset plan to unload the stock when it fell to $60. ImClone now trades around $80.
The star witness against Stewart was Douglas Faneuil, a young former brokerage assistant who vividly described Bacanovic's order when he learned Waksal was trying to sell: ''Oh my God. Get Martha on the phone.''
Ann Armstrong, a veteran Stewart assistant, also testified Stewart had altered a computer log of a message Bacanovic left earlier that day about ImClone.
But the verdict on March 5 - guilty on four counts apiece for Stewart and Bacanovic - set off a string of events as dramatic as the trial itself.
In April, lawyers for both defendants accused one juror of lying about an arrest record in order to get on the trial. Cedarbaum denied a request for a new trial, saying there was no proof the juror lied or was biased.
And in May, federal prosecutors accused Larry F. Stewart, a Secret Service ink expert, of lying repeatedly in his testimony at the trial - mostly about the role he played in ink-analysis testing of a stock worksheet. The Stewarts are not related.
Just last week, Cedarbaum again denied new trials for Stewart and Bacanovic, this time saying there was ''overwhelming independent evidence'' to support the guilty verdicts.
Both the juror issue and the Larry Stewart perjury charges are expected to form the basis of the appeal.
Stewart resigned as CEO of Martha Stewart Living Omnimedia Inc., once a $1 billion media empire, when she was indicted in 2003. She gave up her seat on the board after she was convicted, but remains founding editorial director.
In late 2003, just weeks before her trial was to begin, Stewart told ABC News that ''what I did was not against the rules.'' She also said she was afraid of prison.
She added: ''But I don't think I will be going to prison, though.''
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Wow thats pretty sad when your 600 cats and Martha Stewart are your only friends!
