boston.com Business your connection to The Boston Globe

Jury selected for Stewart case

Diverse panel will hear opening statements today

NEW YORK -- Women outnumber men eight to four on the jury that will decide Martha Stewart's fate -- a panel that includes a reverend, a man who lost money because of Enron's collapse, and a woman who says the government should move faster to prosecute corporate scandals.

The jury, culled by lawyers from a pool of hundreds, was seated yesterday to decide whether Stewart lied to investigators about a well-timed stock sale in 2001. Opening statements were set for this morning.

Many of the jurors told US District Judge Miriam Goldman Cedarbaum in private interviews they had been exposed to some of the enormous pretrial publicity that has surrounded Stewart's prosecution but assured her they could be impartial anyway.

Stewart is accused of working with her stockbroker to concoct a story about why she sold 3,928 shares of ImClone Systems on Dec. 27, 2001 -- just before it plunged on a negative government review of an ImClone cancer drug. The government claims Stewart was tipped that ImClone founder Sam Waksal was trying to dump his own shares. Stewart and the broker, Peter Bacanovic, say they had an agreement to sell the stock when it fell to $60 per share.

The jury includes a man who said he lost money in a mutual fund because the stocks in the fund were damaged by the collapse of Enron Corp. in 2001.

One juror said she believes poor people "often don't have the right to as much justice as they would like to have." She also said she wished the government would move faster to prosecute the corporate scandals because "I think a lot of people are concerned that things have happened that aren't being followed up."

Another juror is a reverend who counsels married couples.

In a defeat for Stewart even before testimony gets underway, Cedarbaum ruled yesterday her lawyer may not ask jurors to speculate why Stewart was never charged with criminal insider trading. Stewart's defense team also will not be allowed to argue that she is being prosecuted merely for claiming she was innocent, or that the securities fraud charge against her is an unusual application of the law.

The securities fraud count accuses Stewart of trying to prop up the stock of her own company, Martha Stewart Living Omnimedia, by saying in 2002 that she had done nothing wrong and was cooperating with investigators.

The charges against Stewart carry a prison term of 30 years, although federal sentencing guidelines would reduce the term if Stewart were convicted.

The government indicated one of its first witnesses would be a Merrill Lynch compliance officer who would talk about the company's manual for brokers, which prohibits brokers from discussing one client's affairs with another.

Prosecutors say Bacanovic sent word to Stewart through an assistant that Waksal was trying to unload his ImClone shares. Waksal later admitted having advance word of the government report that sent the stock falling.

The judge yesterday ordered Bacanovic's defense team to be more specific in subpoenas it has issued for documents from the assistant, Douglas Faneuil, who is expected to be the government's star witness.

Faneuil claims he was plied with gifts in exchange for backing Stewart and Bacanovic's account. The defense teams are trying to damage Faneuil's credibility by showing he changed his story in a deal with prosecutors.

SEARCH THE ARCHIVES
 
Today (free)
Yesterday (free)
Past 30 days
Last 12 months
 Advanced search / Historic Archives