Martha Stewart Case Term Paper

Pages: 5 (2080 words)  ·  Bibliography Sources: ≈ 10  ·  File: .docx  ·  Level: College Senior  ·  Topic: Criminal Justice

¶ … Martha Stewart Case

Martha Stewart aged 62, who was the CEO of a media company and a leading light of gracious living and domestic style sold 3928 ImClone shares for $58 just a day before Imclone declared that the Federal and Drug Administration had rejected its cancer-drug application. The next business day after the announcement the lowest that the Imclone shares sold at were $43.39. Martha Stewart had made a maximum profit of $57,388. (Convicting the Wrong CEO - the Martha case is a distraction from the Wall Street's real crimes) Martha Stewart was indicted on three counts, which were that she sold some stock because of information she received that an insider was selling stock, telling lies to investigators and conspiring with others to tell lies to the investigators. (What the Martha Stewart Case Means to You)

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The federal prosecutor for the Martha Stewart case was James Comey and he claims that he pursued the case not because of who she was but more because of what was done by her, though this is hard to believe on the basis of the legal theory he used to go after her. (Lessons of Martha Stewart Case) the others involved in the Martha Stewart case include Peter Bacanovic, who was Martha Stewart's broker at Merrill Lynch. He was convicted of obstruction of justice and lying in the Stewart's case. Samuel Waksal founded ImClone and a friend from old times of Martha Stewart. He is serving sentence for tipping off his daughter Aliza about the bad news and advising her to sell the ImClone stocks before they fell and also for dodging sales tax on purchase of paintings. Finally it was Douglas Faneuil, who was a former assistant of Bancovic at Merrill Lynch. He informed the investigators that Bancovic had ordered him to tell Martha Stewart about Waksal selling his shares. He pleaded guilty to the charge of accepting gifts to remain silent about the sale of Martha Stewart's stock. (Key players in the Martha Stewart case)

Term Paper on Martha Stewart Case Assignment

Martha Stewart was convicted in March 2004 of conspiring with her stockbroker in lying to federal investigators on the sale of the ImClone shares in December 2001. Her lawyers are making attempts to have the conviction overturned and will be filing their brief before the U.S. Circuit Court of Appeals before October 20. The case is expected to come up for hearing in early 2005. (Questions and answers about the Martha Stewart case)

So why is there such a lot of controversy with this criminal conviction of Martha Stewart. From a strictly technical standpoint there is nothing wrong. Martha Stewart had violated a law for which the jury had found her guilty and she was convicted. The problem arises from a moral perspective. Many a time law collides with morality and justice and this principle is clearly seen in the immoral and unjust, though technically legal conviction of Martha Stewart. This moral rot, which has increasingly infected the federal government from years ago in which the primary role of the government is seen to be a paternalistic caretaker for the citizens, pervades the Martha Stewart case from beginning to end.

Let us start with the Federal Drug Administration. In the first place does this paternalistic government need bureaucrats to make the choice of grown up citizens on whether a drug can be used on them or not. More importantly, while the drug was under scrutiny FDA officials leaked information that the drug was not likely to be approved. This information made its way to individuals who made use of it for pecuniary benefits and later lied to the investigators. These people were prosecuted and punished by another set of bureaucrats, when in the first place this would not have happened if the bureaucrats at the FDA had kept their mouth shut. Again who has Martha Stewart hurt by this act? She was not an employee of the company and was only trying to cut her losses through the information that was given to her. Yes some stockholders may have lost some money, but the real reason stockholders lost a lot more money was the denial of approval by the FDA for the cancer drug only to find it satisfactory later in colon cancer. (the Wrongful Conviction of Martha Stewart 8)

Were the FDA officials willing to reimburse money lost by the people on their decision and what about this change of heart? Just imagine the number of people who would have made a pile on this new decision of FDA, as the stocks of ImClone have risen with it. Have the Justice Department ever acted on trying to find out how the information leaked and who was responsible and pursuing them? The obvious answer is no. This is not the only example of federal hypocrisy in this case. The law that was violated by Martha Stewart is known as Section 1001 of the federal criminal code, by which it is a federal offense to lie to any federal official. If lying to federal officials is a crime then the reverse should also be true in that it is a crime for federal officials to lie to the people.

Yet all federal officials including prosecutors, presidents, congressmen and department bureaucrats are free to lie as much as they want and quite often do, without any remorse or regret and it is not a criminal offense when they do so. There is no feeling of indignation and outrage felt by any of the bureaucrats including those in the Justice Department about this. There have been several instances of FBI officials lying and obstructing justice and the Justice Department closing their eyes or even protecting them. These are few examples just to prove the point. The obstruction and lying by FBI and Justice Department officials in the Randy Weaver case, the role of the FBI agents in the attack and massacre at Branch Davidian compound in Waco and even the preventing of firemen to do their job. (the Wrongful Conviction of Martha Stewart 8)

As stated earlier Martha Stewart was not an insider of the company, but merely an investor, who tried to sell the shares when she knew that they were going down, but her crime was not that. It was lying about it, when the government wanted to know why she did it, more so being a celebrity. She could have refused to cooperate and just insisted that her brokers advised her to do so and that is what they are paid to do. In cooperating with the government she was railroaded into believing she had committed a crime and may have also received some weak legal advice that she decided to lie, as to why she sold the shares to get out of it. True she should not have lied, but many or nearly all in her shoes would have done the same, but what right does the government have to ask her why she sold her shares as long as there was nothing illegal and she has not been convicted of this. (Martha Stewart has been railroaded)

The handling of the Martha Stewart case by the Justice department leaves a lot to be desired. This selective prosecution of a powerful woman has distracted the nation's attention from the damage done by Bush cronies' corporate corruption and warns women to remain a stereotype female without attempting to become power centers. The economy of the country and the lives of several Americans were harmed by the cronies of Bush by manipulating markets, falsifying records, and getting sweet deals for the reconstruction of Iraq. The Bush administration even impeded the investigation of missing weapons of mass destruction, which was the purported reason for going to war in Iraq, which has caused many Iraqi women to live in fear of extremists. Those who were responsible for all this are still scot-free, while Martha Stewart has been convicted for a crime had a negligible impact on the country. (Now-NYC Condemns handling of Martha Stewart case outraged at scape-goating of successful woman)

The real misdeeds of Martha Stewart, stupidity, greed and clueless ness hardly qualify as criminal offenses. In addition, this case is trivial in comparison to what happened at Enron, WorldCom, Global Crossing and Adelphia, which has caused severe damage. Thousands of people were left jobless and many lost a lifetime's savings and some communities were so badly affected, that they may find it difficult to recover because of this serious corporate misbehavior. (Convicting the Wrong CEO -- the Martha case is a distraction from Wall Street's real crimes) Prosecutors look forward to indicting high-profile people and pad their conviction records, so that they can make a name for themselves. In the case of the latter they charge someone for a number of crimes and then offer to drop most of the charges if they plead guilty to the remaining and many do.

In the 1970s and 1980s Rudolf Giuliani made name for himself in this manner… [END OF PREVIEW] . . . READ MORE

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How to Cite "Martha Stewart Case" Term Paper in a Bibliography:

APA Style

Martha Stewart Case.  (2004, November 22).  Retrieved September 28, 2020, from

MLA Format

"Martha Stewart Case."  22 November 2004.  Web.  28 September 2020. <>.

Chicago Style

"Martha Stewart Case."  November 22, 2004.  Accessed September 28, 2020.