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Two Sides of the Story
When Martha Stewart goes to trial along with her stockbroker, Peter Bacanovic, the jury will have to decide who to believe. The following outlines the widely differing accounts of the circumstances surrounding the sale of Stewart's ImClone stock based on information obtained from court documents:
| DEFENSE SAYS: |
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PROSECUTION SAYS: |
| Martha Stewart spoke to Peter Bacanovic on Dec. 27, 2001, who informed her that ImClone stock dropped below $60 a share. She told him to sell it pursuant to a "selling conversation," in which the two agreed to dump the ImClone stock when the price dipped to $60. She does not recall discussing ImClone CEO Sam Waksal or the sale of the Waksal shares with Peter Bacanovic. |
The Phone Call |
Stewart only sold the shares because she learned of the sale of Sam Waksal's shares, information that was inappropriately passed along to her since Peter Bacanovic was also Waksal's broker. |
| Peter Bacanovic and Martha Stewart spoke directly on Dec. 27, when she ordered the sale of her ImClone stock. Martha Stewart does not recall speaking to Bacanovic's assistant, Douglas Faneuil. |
Which Broker? |
Martha Stewart never spoke directly to Bacanovic when she ordered the sale of her ImClone stock. Instead, she spoke to Douglas Faneuil. |
| During their Dec. 27 phone conversation, Martha Stewart and Peter Bacanovic discussed her corporation, Martha Stewart Living Omnimedia, as well as Kmart. |
Chit Chat |
The defendants added minute details to their purported conversation to lend credibility to their claim that the call took place at all. |
| During their Dec. 27 phone conversation, Martha Stewart and Peter Bacanovic discussed her corporation, Martha Stewart Living Omnimedia, as well as Kmart. |
Martha's Phonelog |
The defendants added minute details to their purported conversation to lend credibility to their claim that the call took place at all. |
| Peter Bacanovic says the discussion regarding Martha Stewart's portfolio, in which the pair decided to sell ImClone when it dropped to $60 a share, occurred on Dec. 20, 2001. Martha Stewart said it occurred in November or December 2001, around the time ImClone stock was $74 a share. |
"Selling Discussion" Date |
Prosecutors say no selling discussion regarding ImClone stock took place and was a "fictitious explanation for her sale." ImClone's market price was around $74 on Dec. 6, 2001. |
| Peter Bacanovic turned over a worksheet used during the selling discussion. Next to ImClone there is his handwritten notation "@60". |
The Worksheet |
Prosecutors say the "@60" notation was added only after authorities ordered Bacanovic to turn over information regarding Martha Stewart's accounts for the federal probe. They say the ink used to write "@60" was "scientifically distinguishable" from the pen ink used on the rest of the worksheet. |
| Martha Stewart only spoke to Peter Bacanovic once between Dec. 28, 2001 and Feb. 4 , 2002. The two did not discuss what questions investigators asked Bacanovic. |
Further Contact |
Prosecutors say Peter Bacanovic and Martha Stewart met for breakfast on Jan. 16, 2002, and that phone records reflect calls between the two on Jan. 25 and the morning of Feb. 4. |
| Martha Stewart and her lawyers told reporters on several occasions that they sold the ImClone shares pursuant to the "selling discussion" agreement. Defense lawyers say the statements were truthful and were otherwise protected by the First Amendment. |
Public Statements |
Investigators claim such statements were false and designed to prevent the value of Martha Stewart Living Omnimedia stock from plummeting.Prosecutors say the motivation behind the statements constitutes securities fraud. |
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Domestic diva Martha Stewart and her stockbroker, Peter Bacanovic, stand trial for conspiracy, perjury, securities fraud and obstruction of the investigation into the sale of her stock in ImClone, a biotech firm.
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 Verdict Sheet
Jurors had to fill out this form when they decided their verdict.
New Indictment
After the judge tossed the securities fraud charge against Martha Stewart, count nine was dropped from the original indictment.
Original Indictment
This federal indictment charges Martha Stewart and her financial advisor, Peter Bacanovic, with nine counts (PDF)
Defense's Argument
An excerpt from this motion filed by the defense outlines Martha Stewart's side of the story.
E-mail Exhibits
E-mails from Bacanovic and his assistant on the day of Martha Stewart's trade were turned over to federal authorities.
Waksal's Phone Log
Former ImClone CEO turned over these message logs, which show calls from Martha Stewart on the day she sold her stock.
Faneuil Information
Bacanovic's assistant, Douglas Faneuil, was charged with these misdemeanor counts but later cut a deal.
Waksal Complaint
Read the charges filed by the SEC against Samuel Waksal, who is now serving an 87-month prison sentence.
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