United States v. Martha Stewart

Stewart sold all her shares of ImClone stock û 3,928 shares at a profit of approximately $228,000 û on December 27, 2001 after receiving a telephone message from Bacanovic that ImClone was about to start ôtrading downwardö (Indictment, 7). In a conversation later that day with Douglas Faneuil, another Merrill Lynch broker, Faneuil told Stewart that Samuel Waksal, the president and CEO of ImClone, was selling all of his ImClone stock. Stewart then directed Faneuil to sell all of her ImClone stock as well.

The first count of the indictment charges Stewart with conspiring with Bacanovic to obstruct justice, make false statements and commit perjury regarding her sale of ImClone stock (Indictment, 1). Bacanovic, prosecutors allege, based his message to Stewart that ImClone would begin trading downward on the ôconfidential, nonpublic informationö he acquired that Waksal had ordered a sale of all of his own ImClone stock (Indictment, 6). Prosecutors contend that Stew

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01 of the U.S. Code. That section states that ôWhoever . . . makes any false, fictitious or fraudulent statements or representations . . . [to federal officials] shall be fined not more than $10,000 or imprisoned not more than five years, or both.ö The United States Supreme Court has defined a ômaterialö statement under the statute as any statement that has ôa natural tendency to influence, or [be] capable of influencing, the decision of the decisionmaking body to which it was addressedö (Kungys v. United States, 485 U.S. 759, 770 (1988)). Criminal defense lawyers have long argued that section 1001 is overly broad. For example, Kevin Marino maintains that section 1001 is ôdangerous because it gives the government enormous latitude to engage in what might be categorized as a vengeful prosecution. When you look more closely at the [Stewart] indictment, you realize she's being indicted for the temerity for not shooting straight at the government in an attempt to protect her imageö (Berenson, 4.5). It is true as Marino states that a close reading of the indictment lends itself to a reading that Stewart's charges are based on her unwillingness to be forthcoming with prosecutors. However, as another securities attorney, Lee Sorkin, s
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Some common words found in the essay are:
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Approximate Pages = 7 (250 words per page)

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