I love Martha Stewart-bashing as much as the next person. Martha’s ability to make anyone feel inadequate for not whipping up a white bean and saffron compote served in little pots recycled from the greenhouse with a wire ribbon and papier-mache American flag for the Fourth of July is unparalleled. Stories of her tyrannical personal life abound. Anything that would wipe that smug half-smile off her face would be seemingly welcome.
So why is it that the whole Martha Stewart ImClone thang annoys me? Perhaps because, for all the talk of “insider trading,” not only did Martha not actually make all that much money off the deal (a whopping $45k), she hasn’t even been charged with insider trading.
Stewart was a friend of Waksal’s, but it’s pretty clear that she didn’t know what Waksal knew: The Food and Drug Administration was going to hold up a new drug his company wanted to release. In fact, according to the SEC itself, after selling her ImClone stock, Stewart called Waksal and left the following message: “Martha Stewart — something is going on with ImClone and she wants to know what.”
Although the SEC’s civil complaint makes much of the Stewart-Waksal friendship, the SEC nowhere alleges that Stewart had any advance knowledge of the problem with the FDA. In other words, Stewart got a hot tip and she acted on it. So what?
[…] Tellingly, the Justice Department did not charge Stewart with insider trading. Only the SEC’s civil complaint does so. Instead, the Justice Department went after Stewart for conspiring to obstruct justice by engaging in the great American pastime of lying to the cops. According to published reports, the U.S. attorney decided that going after Stewart would be an “unprecedented” expansion of insider trading law.
As I mentioned to a particular adolescent earlier in the weekend, the lesson of history is that it’s not the crime that nails you — it’s the cover-up.
(via Volokh)
I’ve heard sound bites of her lawyer (I guess) saying that she’s being prosecuted for a crime of which the investigation had “vindicated her.” Personally, I don’t think that declining to charge somebody with a crime exonerates them. Lack of evidence does not prove innocence, and certainly could indicate obstruction of justice.
The narrative of events that the SEC has put forward, as I understand it, does not seem to support an insider trading charge. If there’s been obstruction of justice, she should certainly be nailed for that, of course. We’ll see.
hey Dave, thanx so much for ur info on Martha Stewart. i have 2 write an essay on her for my world history class comparing her to Machiavelli, so if you have any more info on her, please let me know. thanx so much!!!