New York, NY, Feb. 23--Lawyers for Martha Stewart and her former Merrill Lynch & Co. broker are strongly leaning toward not putting their clients on the witness stand, according to people familiar with the matter.
In a bold move, lawyers for the defendants will likely employ a minimalist defense. Combined, the two teams might call a handful of witnesses, perhaps as few as five or six, and the jury could be deliberating by the end of the week, these people say.
The trial has seemingly zigzagged day-to-day in favor of one side and then the other and therefore this determination could change. The defense teams will likely make a final decision after the judge presiding over the case rules Monday morning whether to dismiss some of the charges against Stewart and Peter Bacanovic, her former broker.
From the start, attorneys for Stewart and Bacanovic had planned to put their celebrated clients on the stand only if the government presented evidence that they alone could rebut. That is because the risks are high; not only could the defendants struggle under questioning, but prosecutors also would be able to elicit information they have as yet been unable to present to the jury, such as the contents of key conversations between the two.
The strategy, of course, doesn't mean the pair will be acquitted. It is possible, for example, the jury could think the defendants have something to hide. In celebrity trials, jurors sometimes are more eager to hear from defendants than usual. And prosecutors believe their case is strong, according to a person familiar with the matter.
Stewart and Bacanovic are standing trial on charges of obstruction of justice and conspiracy relating to the domestic entrepreneur's sale of 3,982 shares of ImClone Inc. on Dec. 27, 2001. The government alleges Stewart sold because her broker gave her a tip, via his assistant, that ImClone Chief Executive Samuel Waksal was trying to sell his shares. The next day, ImClone released bad news about its key cancer drug that sent the stock plunging. Waksal now is serving a seven-year sentence for insider trading and other crimes.
Stewart and Bacanovic say they had a pre-existing agreement to sell the stock when it fell below $60 a share. The government says that is a fabrication and has charged both with obstructing an investigation into ImClone trading. Stewart hasn't been charged with criminal insider trading but is facing an unusual charge of securities fraud for misleading investors in her own company, Marthg Stewart Living Omnimedia Inc., by publicly stating the same allegedly false reason for her sale.
After four weeks and 21 witnesses covering more than 3,500 pages of transcript, the government on Friday rested its case. By not calling the defendants, the lawyers would signal to the jury they don't think the government met its burden.
In its presentation, the government highlighted inconsistencies in accounts given by Stewart and Bacanovic about the circumstances surrounding her ImClone sale and its aftermath. Bacanovic's former assistant, Douglas Faneuil, testified that his boss instructed him to tip Stewart; he also testified that he initially felt pressured by Bacanovic to lie and back Bacanovic's version of events. One of Faneuil's friends testified Friday she had heard the same account from Faneuil in early January. That is well before he made a deal with the government and pleaded guilty to a misdemeanor.
