- Martha Stewart, the disgraced American businesswoman,
yesterday resigned from the board of the company that bears her name.
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- The expected move came a little more than a week after
Stewart was found guilty of obstruction of justice, conspiracy and making
false statements to federal investigators who were looking into a suspicious
share sale.
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- Stewart is scheduled to be sentenced in June. She faces
a maximum of 20 years in prison, but legal experts suggest she is likely
to serve between 10 and 16 months. Stewart has vowed to appeal the verdict.
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- The self-styled queen of domesticity will remain closely
involved with her company, Martha Stewart Living Omnimedia, taking the
role of founding editorial director. In a statement, Stewart said her resignation
was in the "best interest" of the company. "I am heartsick
about my personal legal situation - and deeply sorry for the pain and difficulties
it has caused our employees," she said.
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- There have been questions over whether the company, which
is tightly tied to Stewart's personal image, will survive her courtroom
scandal. Shares have fallen 40% since the scandal first came to light and
were trading another 43 cents lower yesterday at $9.90.
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- The company publishes a series of magazines, produces
television programming and sells a range of everyday merchandise and furniture.
It has already been trying to establish new brands not associated with
the founder. Stewart's own show has already been dropped by CBS and her
newspaper column has been axed by the New York Times. As a convicted felon,
it is likely that securities regulators would have forced her to stand
down if she had not resigned.
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- In her new role, Stewart will continue to provide creative
input on product design and development, as well as writing two books about
home-keeping and baking and have a say in the company's strategic direction
and brand.
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- Stewart's troubles began when she sold shares in the
drug company ImClone Systems in December 2001. Government prosecutors said
she had been given a tip by her broker that the company's founder had been
trying to offload his shares ahead of a damaging announcement. They argued
that when she was asked about the sale, she conspired with her broker Peter
Bacanovic to hide the truth.
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- ImClone has gone from strength to strength since Stewart
sold her shares. The company yesterday reported narrower fourth-quarter
losses of $26m (£14.4m), against $39m a year earlier. It won approval
for its Erbitux colon cancer drug last month.
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- Guardian Unlimited © Guardian Newspapers Limited
2004
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- http://www.guardian.co.uk/usa/story/0,12271,1170296,00.html
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