- NEW YORK (Reuters)
- The judge in the Martha Stewart (news - web sites) case on Wednesday
refused to grant a mistrial sought by her lawyers who said they were wrongfully
barred from arguing that no insider trading took place.
- Stewart and Peter Bacanovic, her co-defendant and former
broker, are on trial for conspiring to hide the reason that Stewart sold
shares in biotech company ImClone Systems Inc. While prosecutors say Stewart
believed she had gotten a secret tip, she is not charged with insider trading.
U.S. District Judge Miriam Cedarbaum has repeatedly refused defense lawyers'
requests to introduce witnesses to testify that the sale did not amount
to insider trading, prompting Stewart's lawyers to seek a mistrial.
That motion was denied on Wednesday.
"To have a minitrial on insider trading ... would so confuse and distract
the jury from the charges in the indictment" that they could not fairly
decide the case, Cedarbaum said.
Robert Morvillo argued that the defense was built on the premise that the
defendants cannot be convicted of lying to authorities when they are not
charged with insider trading.
"That's the way we set up our defense in this case," he told
the judge.
Morvillo said he wants to prove there was "an absence of motive"
by "proving there was no insider-trading violation."
At issue is Stewart's sale of some 4,000 shares of ImClone on Dec. 27,
2001, ahead of news that the company was about to receive bad news.
Morvillo sought the mistrial shortly before he began cross examination
of Securities and Exchange Commission (news - web sites) lawyer Helene
Glotzer, who has testified that Stewart lied to investigators looking into
the stock sale.
Glotzer's testimony, which started on Tuesday, began a new phase of the
trial in which the government is focusing on charges that Stewart and Bacanovic
made a series of false statements to federal officials during interviews
in 2002.
Morvillo sought to undermine Glotzer's testimony by drawing out the concession
that Stewart was not properly advised during those interviews that making
false statements constitutes a crime.
"When Martha Stewart was brought in on February 4, was she put under
oath?" Morvillo asked.
"She was not," the SEC lawyer responded.
Morvillo later followed up by asking: "Did anyone tell Ms. Stewart
it was a crime to make false statements in the court of that conversation?"
-- a reference to an April telephone interview between investigators and
the trendsetter.
"I don't recall anyone saying that," Glotzer said.
-
- http://story.news.yahoo.com/news?tmpl=story&cid=578&ncid
=578&e=16&u=/nm/20040211/ts_nm/crime_marthastewart_dc
|
