MARTHA STEWART. Cont'd.
Martha Stewart to Meet Probation Officer
NEW YORK - Martha Stewart and her former broker, Peter
Bacanovic, will be back in federal court Monday, three days after their
convictions on four counts each of obstruction of justice and making false
statements, to meet with their probation officers. The pair then will have
just over three months, until June 17, before they're scheduled to be
sentenced by U.S. District Judge Miriam Goldman Cedarbaum.In the meantime,
lawyers for both defendants plan to file a flurry of post-trial motions,
renewing arguments they made two weeks ago for dismissal of the case.
Eventually, they will appeal the verdicts. Stewart's lawyers will argue, among
other things, that Cedarbaum's decision to allow Count 9 of the original
indictment into the trial compromised their defense. Count 9, the most serious
charge against Stewart, accused her of securities fraud in relation to her own
company when she proclaimed two years ago she was innocent of any wrongdoing
in her sale of ImClone stock. It was an unusual interpretation of federal law,
one Cedarbaum called "novel." But she allowed it to be presented to the jury
before deciding, late in the trial, that prosecutors hadn't presented
substantial evidence to support the charge. She dismissed it before closing
arguments were made. In their appeal, Stewart's lawyers will argue that their
defense against the charge led to the introduction of evidence that hurt her
in other ways. Bacanovic's lawyers, meanwhile, are expected to challenge the
admission of testimony from Stewart's longtime friend Mariana Pasternak. After
the trial, juror Chappell Hartridge said Pasternak's testimony about Stewart's
gratitude toward Bacanovic for tipping her to sell her ImClone stock before
its collapse was instrumental in the conviction of Stewart. But it's likely
that the statement supported the conviction of Bacanovic as well, even though
the judge ordered jurors to view the statement only as it pertained to
Stewart.
Second-Guessing the Lawyers
In retrospect, several decisions seemed to hurt the defense more than help it: The nature of the attack on Douglas Faneuil, the government's star witness in the case. In order to win acquittal, defense lawyers had to undermine Faneuil's credibility as a witness. But they tried to define Faneuil as a lying busybody who had an obsession with Stewart, a characterization that didn't mesh with his demeanor. The attempt by Stewart attorney Robert Morvillo to suggest that Faneuil was a misguided and possibly delusional character seemed more credible than other efforts to demonize the 28-year-old. The admission that Stewart had indeed been tipped by Faneuil about ImClone CEO Sam Waksal's attempt to dump his stock. In his closing argument, Morvillo finally conceded that his client had received the much-disputed tip about Waksal's stock sales but insisted that Stewart sold her ImClone shares because of a $60 price agreement she had with Bacanovic. Because the core of Bacanovic's defense was to discredit everything that Faneuil said on the witness stand, Morvillo's admission hurt his overall cause by confirming at least part of Faneuil's story. Lead prosecutor Karen Patton Seymour leapt on the admission in her rebuttal of the defense arguments. Morvillo's argument that the defendants were too "bright and successful" to do something so stupid. How could Stewart and Bacanovic have hatched a conspiracy then botched it so badly by telling different versions of the same story? he asked. In her rebuttal, Seymour again drew blood, saying that white-collar criminals do dumb things all the time. She referred to Waksal, who learned on Dec. 26, 2001, that the FDA would turn down the application of the ImClone drug Erbitux. The next day, he tried to sell millions of dollars' worth of his stock and is now in jail.APNews.