Martha Stewart Sentenced to 5 Months

NEW YORK (AP) – Friday July 16, 8:25 am PT – Domestic icon Martha Stewart was hand­ed a prison term of just five months Friday for lying about a stock sale. After ask­ing the judge for lenien­cy, she emerged defi­ant from the cour­t­house to say she was being per­se­cut­ed and declared, “I’ll be back.” 

“I’m not afraid. Not afraid what­so­ev­er. I’m very sor­ry it had to come to this,” she told a crowd of media and sup­port­ers after­ward, speak­ing in a strong voice on the cour­t­house steps.

Stewart also was ordered to serve five months of home con­fine­ment and fined $30,000. She was spared an imme­di­ate trip to fed­er­al prison when U.S. District Court Judge Miriam Goldman Cedarbaum stayed her sen­tence pend­ing appeal. 

In the court­room, her voice was shaky as she appealed for a reduced sen­tence, ask­ing the judge to “remem­ber all the good I have done.” 

“Today is a shame­ful day. It’s shame­ful for me, for my fam­i­ly and for my com­pa­ny,” she said. 

But out­side the cour­t­house, Stewart was far more force­ful and con­fi­dent, com­plain­ing that a “small per­son­al mat­ter” was blown out of pro­por­tion and promis­ing that she would not go quietly. 

The sen­tence was at the bot­tom of the con­fine­ment range for Stewart, who was expect­ed to receive 10 to 16 months. 

Cedarbaum reject­ed a defense request to send to Stewart to a halfway house for the first five months, not­ing that “lying to gov­ern­ment agen­cies dur­ing the course of an inves­ti­ga­tion is a very seri­ous matter.” 

Earlier, Stewart, 62, 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!” 

The jail term was the lat­est blow for Stewart, once the CEO of a $1 bil­lion media empire. After her 2003 indict­ment, she resigned as head of Martha Stewart Living Omnimedia Inc. And fol­low­ing her con­vic­tion, she sur­ren­dered her seat on its board. 

Shares of Martha Stewart Living Omnimedia, which have lost half their val­ue in the two years since the scan­dal began, surged $2.61, or more than 30 per­cent, to $11.25 in trad­ing Friday morn­ing on the New York Stock Exchange. 

Her fall from grace did lit­tle to hurt her stand­ing among Stewart fans. 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.” 

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 jail term was the lat­est blow for Stewart, once the CEO of a $1 bil­lion media empire. After her 2003 indict­ment, she resigned as head of Martha Stewart Living Omnimedia Inc. And fol­low­ing her con­vic­tion, she sur­ren­dered her seat on its board.