Martha Stewart is a dichotomous corporate and media icon, representing both gracious living and business savvy. Stewart built her empire from scratch, beginning a catering business in a friend’s basement. After releasing her cookbook, Entertaining, in 1982, Stewart continued her quest for corporate dominance through her subsequent books, a magazine entitled “Martha Stewart Living”, a line of house wares at Kmart, and a television program. In 1997, she formed Martha Stewart Living Omnimedia, of which she was chairwoman, president and CEO.
It seemed that Stewart’s star would continue to shine brightly, at least until June 4, 2003, when she was indicted on nine counts of securities fraud and obstruction of justice. The country became divided on the issue of insider trading, some believing that Stewart was guilty and should go to jail, while others believed that she was being targeted because she was a woman, a multimillionaire, and entirely unrepentant. While the securities fraud charges were dropped, Stewart was convicted of the remaining charges, making false statements to investigators, and obstruction.
She served five months in prison and five months of home confinement. Multiple theories abounded over the issue of why Stewart was convicted of what appears to be a victimless crime when other celebrities get away with much more heinous crimes. It was Stewart’s greed and her lack of remorse that guaranteed her conviction (Koch) . Stewart had an explanation for the charges of securities fraud. She insisted that she told her stockbroker, Peter Bacanovic, to sell her stock in ImClone when it dropped below a previously-agreed upon level.
Even though her carefully-constructed story was falling apart around her, Stewart “continued to express annoyance at the fact that “such a small thing” had been blown out of proportion,” (Jacobs) . Stewart was not convicted on securities fraud because the federal prosecutors could not prove that Stewart was an insider or that she had abused confidential information. The prosecution was nevertheless able to circumvent the possibility of meeting its burden…by charging and convicting Stewart of making false statements to federal investigators and obstructing an agency investigation (Hasnas, 44) .