Martha Stewart guilty on all counts

AP/MSNBC | March 5, 2004 | unknown

[Bonaparte]

Updated: 4:01 p.m. ET March 05, 2004 NEW YORK - 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. In a statement, Stewart said she would appeal the verdict.

More...

[anonymous_user]

Mind if I second that?

Go for it! :)

[kcvl]

If you owned $50,000 in let's say, Kodak shares, would you sell them Monday if you got a call over the weekend that the company was going belly-up due to the conversion to digital photography vs. celluoid film?

No, not if it was from someone who had inside information, because it is illegal. I would be doing time under the prison if I did what Martha Stewart did. I also wouldn't spend over $1,000,000 for attorneys and another for media consultants. I would go in and tell the truth the first time, like I have always done, each and every time I have ever had to go to court.

[B4Ranch]

"We are a nation of laws, despite Bill Clinton's efforts to the contrary."

That's what keeps you and I on the straight and narrow. The prople is positions of power don't live by our common rules. Ask our President for confirmation.

[Levy78]

Martha Stewart is proof that karma is real.

[kcvl]

Faneuil also testified that Stewart was one of Bacanovic's two most-valuable clients and was close enough to her that he got some shares in Stewart's own company when it went public.

Faneuil said Waksal's two daughters, as well as Waksal's accountant, sold or tried to sell all their shares in ImClone that morning. Faneuil said he told Waksal's accountant he couldn't allow the ImClone CEO to sell his stock, because it was against federal regulations regarding inside trading. The accountant then told Faneuil he would have Sam Waksal's shares transferred to his daughter's account so she could sell them. "I don't think you can do that," Faneuil says he told the accountant, Alan Goldberg.

Then an agitated Faneuil called Bacanovic, who was on vacation in Florida, to tell him what was happening. Faneuil said Bacanovic at first told him to take it all with a grain of salt, but then blurted out: "Oh, my God! Get Martha on the phone."

Faneuil testified that he connected Bacanovic to Stewart's office, where Bacanovic left a message for her. After the call ended, Bacanovic called Faneuil back and told him, "Martha's going to call, and you have to tell her what's going on."

"From that," Faneuil testified, "I took him to mean I had to tell her about the Waksals' sales earlier that morning."

Faneuil stated that he asked Bacanovic, "Well, what can I say? Can I tell her about Sam?" Faneuil said Bacanovic replied: "Of course, you must. You've got to; that's the whole point." Bacanovic then told Faneuil to get back to him about her eventual sale.

*****

Defense attorney David Apfel asked if his client, Peter Bacanovic, Stewart's former broker at Merrill, had told Faneuil his pay would be docked if he didn't lie to investigators. Faneuil responded, "I felt I would be fired if I didn't lie."

*****

Apfel earlier Thursday pressed the witness about whether Bacanovic had bribed him with extra vacation time, airplane tickets and money to keep him quiet.

"I considered those gifts rewards,'' Faneuil replied, adding his boss had told him he was "doing a great job.''

Faneuil described the atmosphere at Merrill as "schizophrenic" in the months after Stewart's ImClone sale, where he was sometimes intimidated by his boss. "I really wasn't aware of being physically afraid of Peter until the day I came forward,'' he said, according to Reuters.

Faneuil said: "I couldn't continue to do this. I lied to the SEC on two different occasions. The cover-up was part of my daily existence, and I just couldn't take it anymore."

*****

Assistant broker Douglas Faneuil says he was bribed with Knick tickets to back up his bosses story.

*****

She would conceal from the FBI and the (Securities and Exchange Commission) the true reason for her sale," said Assistant U.S. Attorney Michael Schachter. "Martha Stewart would lie."

"Martha Stewart probably thought she would never get caught," said Schachter. But she "left behind a trail of evidence," including an altered phone log, which, combined with the testimony of former brokerage assistant Douglas Faneuil, proves her guilt, he said.

"If you believe Douglas Faneuil's testimony, this trial is over," Schachter said.

[Bonaparte]

A short course in "insider trading" from the SEC...

What is "Insider Trading?"

"Insider trading" refers generally to buying or selling a security, in breach of a fiduciary duty or other relationship of trust and confidence, while in possession of material, nonpublic information about the security. Insider trading violations may also include "tipping" such information, securities trading by the person "tipped" and securities trading by those who misappropriate such information. Examples of insider trading cases that have been brought by the Commission are cases against: corporate officers, directors, and employees who traded the corporation's securities after learning of significant, confidential corporate developments; friends, business associates, family members, and other "tippees" of such officers, directors, and employees, who traded the securities after receiving such information; employees of law, banking, brokerage and printing firms who were given such information in order to provide services to the corporation whose securities they traded; government employees who learned of such information because of their employment by the government; and other persons who misappropriated, and took advantage of, confidential information from their employers.

Hope this clears up the confusion, doug.

[kcvl]

ImClone

[kcvl]

IMCL

Last 47.85 Change +1.45

Volume 2,532,849 %Change +3.12%

High 47.88 52 Wk. High 48.93

Low 45.81 52 Wk. Low 14.45

Open 45.84 Currency USD

Prev Close 46.40 Exchange NASDAQ (National)

3/5/2004 11:42 PM ET Pricing Delayed 20 Minutes

[Bonaparte]

Faneuil said Waksal's two daughters, as well as Waksal's accountant, sold or tried to sell all their shares in ImClone that morning. Faneuil said he told Waksal's accountant he couldn't allow the ImClone CEO to sell his stock, because it was against federal regulations regarding inside trading. The accountant then told Faneuil he would have Sam Waksal's shares transferred to his daughter's account so she could sell them. "I don't think you can do that," Faneuil says he told the accountant, Alan Goldberg.

That bastard Waksal dragged his own daughters into not only the insider trading, but the cover-up as well, exposing them both to criminal penalties, including imprisonment.

[kcvl]

FDA approves ImClone's Erbitux

Regulators approve the cancer drug that has been at the center of Waksal, Stewart trading cases.

February 12, 2004: 5:26 PM EST



WASHINGTON (Reuters) - ImClone Systems Inc. Thursday won federal approval to sell the cancer treatment Erbitux, the drug at the center of an insider-trading scandal that landed the company's founder Sam Waksal in jail and put Martha Stewart on trial.

The Food and Drug Administration said it had approved Erbitux for treating patients with advanced colon cancer that has spread to other parts of the body.

ImClone shares were halted during regular trading after sliding 23 percent prior to the FDA's announcement, and the Securities and Exchange Commission said the NASD was examining what appeared to be suspicious trading in the shares.

"My drug is everything I said it was and it would not be here were it not for me," Waksal said in a letter to CNNfn while serving a seven-year prison term after pleading guilty to charges of insider trading.

Erbitux is ImClone's first drug to win U.S. marketing approval. It was cleared for use with another cancer drug, irinotecan, or alone if patients cannot tolerate irinotecan, the FDA said.

Erbitux fights cancer by blocking a protein called epidermal growth factor that helps cancer cells multiply.

When used in combination with chemotherapy, Erbitux shrank tumors in 23 percent of colon cancer patients who had exhausted all other options, according to a clinical trial by ImClone's European marketing partner, Merck KGaA.

The drug can cause serious side effects that may include difficulty breathing and low blood pressure, the FDA said. Infrequent cases of interstitial lung disease, or ILD, were reported in Erbitux patients, "however it is difficult to determine if Erbitux caused ILD," the agency said.

ImClone had sought federal approval for Erbitux in 2001, but the FDA refused to accept that application, calling the company's main study sloppy.

That surprising setback led to the conviction of Waksal, ImClone's founder and chief executive at the time, for insider trading, as well as securities fraud charges against home decorating maven Martha Stewart. Stewart has pleaded not guilty.

"The FDA approval of Erbitux represents a major personal milestone for me and my family" Harlan Waksal, brother of Sam and one of ImClone's former CEOs, said in a statement. "I am grateful to all of the employees of ImClone for their perseverance through difficult times in bringing this drug to market," he added.

[antaresequity]

I would immediately drop a dime on the criminal who passed me that information.

BULL CRAP!...your so full of it...first off passing the information is not illegal...its acting on that it is.

This proves you really don't know what you would do, seeing as you don't even know what 'is'...

You would sell the stock...and if you were really human...you would short the piss out of it...

The air must be pretty thin in your ivory tower?

[Bonaparte]

"first off passing the information is not illegal"

The SEC disagrees with you. See post 106.

Now that we've established your true level of expertise on insider trading law, I should add that you don't even know me, let alone whether I would knowingly commit the crime of insider trading.

Have a nice day.

[KneelBeforeZod]

dang, now she can't own guns

[Johnny_Cipher]

I guess no more Stewart on Food Channel from her kitchen.

Not unless the show is about brewing pruno in one's toilet tank.

[Bonaparte]

For your further education on insider trading law

[Bonaparte]

"...brewing pruno in one's toilet tank."

Hahahahahahahahaha!! Hoohoohooheeheeheehahahaha!

[bogdanPolska12]

Oh Lord :}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}

[Jeff Gordon]

if you owned $50,000 in let's say, Kodak shares, would you ...?

Let's put this in perspective. $50k is about .005% of Martha's net worth of about $1B. To make your question apply to us little people, we need to scale your $50k to something that is meaningful.

Assume the average FReeper has a net worth to be $1M. That is 1000 times less than Martha, thus we need to scale your question by 1000. Thus

if you owned $50 in let's say, Kodak shares, would you ...?

Hell no!

[DCPatriot]

That's a great point.

She's acted like Leona Helmsley (Sp?).

[kcvl]

"Stewart appears to have paid careful attention to her appearance, including getting a facial and a good haircut" (something she won't be getting in prison)

domestic diva’s choice of handbag (a Hermès Birkin)$12,000 - Hermès is named for an obscure British actress (Jane Birkin), costs a minimum of $6,000 and is so hard to get there's a waiting list to get on the waiting list.

"Martha spends long hours pouring Evian into Styrofoam cups, ignoring pitchers of ordinary tap water"

"My trademark and I are the same. I stand for what I am."