Martha Stewart - Rise and Fall

Martha Stewart (born August 3, 1941) is a popular television and magazine personality known for her cooking, gardening, etiquette, and arts and crafts projects, and as a general lifestyle guide and homemaker.

Early life
Born Martha Helen Kostyra in Jersey City, New Jersey to Polish American parents, she grew up in Nutley, New Jersey with four brothers and sisters. A good student, she received a partial scholarship to Barnard College in New York City, where she worked part time as a model to help pay her expenses. She initially intended to major in chemistry but switched to art, European history and architectural history. After graduation, she pursued her budding modeling career and starred in several television commercials. She stopped modelling in 1965 when she had a daughter, Alexis, with husband Andrew Stewart, a law student she met in college. Martha and Andrew divorced in 1990, with her book on Weddings coming out on the same day he filed for divorce.

After modelling, she began pursuing her second career as a stock broker. She continued in this profession until 1973 when recession hit Wall Street. She and her husband then moved to Westport, Connecticut and began restoration of an 1805 farmhouse which is occasionally seen in her television programs (though she uses a stage environment for many shots) and where she still lives today. In later years, she began a successful catering business out of her home and began writing columns and articles on topics such as cooking, gardening, and home furnishing.


Rise to fame
Stewart rose to national prominence with regular appearances on NBC's The Today Show. She became a spokesperson for Kmart in 1987 and launched her first of nine exclusive product lines in 1997. During the 1980s, she was a contributing editor to Family Circle magazine, and in 1990, she started her own magazine, Martha Stewart Living. In 1993, she began hosting a half-hour syndicated television show by the same name. She soon introduced her own line of home products under the name "The Martha Stewart Everyday Collection." She also hosts a cooking show on the Food Network called From Martha's Kitchen and a gardening show on Home and Garden TV called From Martha's Garden. She also founded a website,, to promote her products.

In 1999, she founded the company Martha Stewart Living Omnimedia traded on the New York Stock Exchange to combine and control all her enterprises under one corporate entity. She became its chief executive officer and chairman until 2003. Stewart owns approximately 61% of the equity of the company and 94% of the voting power.


As she rose in stature, Stewart became an easy target for mockery and parody on late-night talk shows and Saturday Night Live. Comedians mocked her persona of perfection and her intense attention to the esoteric details of such typically uninteresting topics as ambrosia salad or leaf decorating ideas for tablecloths. She is often the subject of ridicule from late night comedians such as Jay Leno, David Letterman, Conan O'Brien, and Jimmy Kimmel.

Today, Stewart owns upscale homes in Connecticut and The Hamptons, New York.


Federal indictments and trial
In 2002, Stewart was under investigation for alleged insider trading for selling 3,928 shares of ImClone Systems on December 27, 2001. On December 28, the Food and Drug Administration announced it would not review ImClone's application for Erbitux, which the company touted as a promising cancer drug. ImClone's stock plunged over 70% in the month after the news came out. Stewart has been a friend of ImClone founder Samuel Waksal, who has since pleaded guilty to six counts of wrongdoing related to insider trading before the announcement. On June 6, 2002, the U.S. House Energy and Commerce Committee, which was already investigating dubious ImClone trading, announced that it was probing Stewart's stock sale. On October 3, 2002, Stewart resigned from the board of directors of the New York Stock Exchange. Through all the investigation and allegation, Stewart kept her public persona intact, focusing on her homemaking specialties and downplaying or ignoring the increasing clamor for answers about her role in the scandal.

On June 4, 2003, a federal grand jury in Manhattan indicted Stewart and her former broker Peter Bacanovic on nine criminal counts from the Securities and Exchange Commission (SEC). By selling when she did, the government alleged Stewart avoided losses of $45,673. The charges included securities fraud, obstruction of justice, and conspiracy. Stewart was not indicted on the original charge of insider trading, but only for the coverup that ensued. Stewart maintained her innocence, pleading not guilty, saying she had a standing order with Bacanovic to sell her shares if ImClone stock fell below $60. Stewart resigned as CEO and chairman of Martha Stewart Living Omnimedia on the same day she was indicted, but remained on the company's board.

The day after her indictment, Stewart took out a full-page advertisement in USA Today and launched a website with an open letter of defense "to my friends and loyal supporters." She said, "I want you to know that I am innocent - and that I will fight to clear my name... The government's attempt to criminalize these actions makes no sense to me... I am confident I will be exonerated of these baseless charges."


The SEC later filed a related civil suit against Stewart with charges of insider trading. Stewart's trial was initially set for January 12, 2004, at the request of her lawyers who said they needed plenty of time to analyze the evidence. The trial eventually began on January 20 In New York City presided over by U.S. District Judge Miriam Goldman Cedarbaum. During the trial, Stewart maintained her innocence.

On February 27, 2004, Judge Cederbaum threw out the charge of securities fraud against Stewart. This was the most serious charge; it could have led to up to 10 years in prison with a million dollar fine. The judge called the charge "unfounded" and said that "no jury could feasibly find it to be accurate."

On March 5, 2004, Stewart was found guilty by a jury of eight women and four men on all four remaining counts against her: conspiracy, obstruction of justice, and two counts of making false statements. The maximum sentence for these convictions combined is 20 years in prison, though it is unlikely she will serve the maximum. The jury deliberated for three days following the five-week trial before reaching its verdict. Sentencing was set for June 17. Following Stewart's conviction, a message was posted on her website, reading, in part, "I am obviously distressed by the jury's verdict but I continue to take comfort in knowing that I have the confidence and enduring support of my family and friends. I will appeal the verdict and continue to fight to clear my name. I believe in the fairness of the judicial system and remain confident that I will ultimately prevail."


On March 15, 2004 Martha Stewart resigned from the board of Martha Stewart Living Omnimedia as a result of the conviction.

In an unrelated matter, Stewart faced more legal trouble in February 2004 as her company, Martha Stewart Living Omnimedia, was sued by Kmart for allegedly "double-counting" royalty payments and advertising spending. The companies signed a seven-year deal in 2001 to market Martha Stewart Everyday brand home decorating, garden products, and housewares through Kmart stores. Kmart filed for bankruptcy protection seven months later and has since closed 600 of its 2,100 stores.