First They Came for the Doyennes of Domesticity…

New at Reason: If they can do it to Martha Stewart they can do it to any of us. So why aren't we sticking up for her? Michael McMenamin calls for action.

Comments

[StMack]

Dude,

You chide CEOs as spinless but in truth they are caught between a rock and a hard place. Condemned for not speaking by the public for not speaking out in defense of one of their own, and facing worse from their boards of directors and investors if they do and it has an impact on the price of their companies stock.

After looking at what the taint of scandal did to Omnimedia stock would any CEO want to link their name or their companies to Stewart's cause?

[Douglas Fletcher]

I hope she beats the rap but I still can't stand to look at the witch on the tube.

[R. C. Dean]

Does this sort of scenario only apply in securities cases or can any defendant be prosecuted for claiming to be innocent (before convicted, or even tried)?

Only in securities cases. The charge is that by claiming to be innocent, she was making a false statement in order to preserve the price of her company's stock. That rationale does not travel well.

Of course, it is Orwellian to the point of insanity as well, especially when you consider that she has been charged with lying when she claimed her innocence of charges that the government decided not to bring.

If she goes to trial, Martha walks. I can almost guarantee it.

[R. C. Dean]

One more thought - the government's theory opens up a whole new Catch-22. It is securities fraud to make false statements, and also to withhold material information. Thus, if rumors are circulating that you may be indicted for something, and you are innocent but make no public proclamation, you have withheld material information and committed securities fraud.

Not only can you be charged for denying rumors that you may be indicted, as happened to Martha, you can be charged for not denying rumors that you may be indicted. Is that sweet or what?

[s.m. koppelman]

How did that article escape the WSJ op-ed page?

[rst]

That I rarely have pity for powerful media mavens and moguls notwithstanding, after how the bitch slammed my hometown, I was inclined to say let her rot in prison, but I can't see how a judge is going to be convinced that there is anything materially false about declaring one's innocence before a trial has been completed to determine whether that statement is false. It simply does not compute. Hopefully this is something else to be thrown back in DOJ's face.

[StMack]

But if the charge stands, they'll have something else to throw at Michael Jackson. I guess the standard is that while you have the right to be presumed innocent, you don't have the right to claim innocence.

[ed]

There are many reasons for the silence: fear of reprisals from DOJ, an unadmitted (except for the satirists) delight in seeing Martha squirm, jealosy, envy, etc. But not publicly supporting a fellow businessperson has become the rule, not the exception, in modern America. The act of taking an unpopular public stand for principle has all but disappeared among the business elite.

[junyo]

I think people in general, and other CEO's in particular aren't rallying to Martha's defense for a couple of understandable reasons. Martha is the government's trophy kill, to demonstrate it's willingness to prosecute "corporate fatcats". The fact that the fatcats of Enron and Worldcom et al have already done their damage and escaped relatively unscathed is beside the point, the public is percieved as wanting a sacrifice, so the government is prepared to offer up Stewart. Other CEO's rushing to her aid risk being portrayed as merely looking out for one of their own rather than as taking a principled stand. And in an environment where "if you're not guilty, why would you object to [insert civil rights violation]?" passes as a valid argument, why take the risk of defending her for little if any tangible gain? Also raining out the "Free Martha" rallies is the fact that the basis of the government's case is that Stewart attempted to manipulate the stock price of Martha Stewart Living Omnimedia, Inc. by her denial and subsequent explanation (allegedly false). This was greatly facilitated by the fact that the value of Martha Stewart Living Omnimedia, Inc. is almost entirely based on the reputation of Martha Stewart. While this is true to a lesser extent for other CEO's (a similiar allegation against Phil Knight probably wouldn't move Nike's price all that much.), it definitely doesn't map to the experiance of the ordinary citizen, which means the "it could happen to you too" argument falls flat.

[Ron Hardin]

It's a stupid law anyway. The more insider trading, the better everything goes. For example it gets the stock price to the right price faster.

They're getting her for lying to a federal official or something; I'd think that was almost a moral obligation, not something illegal. Lesson: don't talk to federal officials. I assume you have the right to remain silent even if you didn't do anything. Perhaps not. If they charge you with remaining silent, then you can remain silent, that ought to be true. Still, they jail reporters for not talking. Hmm, maybe the trick is to act like you did the deed yourself. There's some circumstance where you don't have to talk in, and it's only a question of how to get into that situation.

[dude]

Does this sort of scenario only apply in securities cases or can any defendant be prosecuted for claiming to be innocent (before convicted, or even tried)? Weird.

CEOs and executive types are the most spineless, bad-PR adverse weasels on the planet. Something about climbing the corporate ladder instills the instinct to never speak your mind. You get ahead by telling people what they want to hear. They would never say anything that could percieved as supporting the token sacrificial lamb for corporate malfeasance.

(And yes, it is interesting that Ken Lay and Bernie Ebbers still free men after all this time. . .)

[Rebecca]

Hmmm.. Random flippant comment: I thought that liberals WANTED wealthy fatcats to get the axe, given that they exploit the poor and downtrodden. Or did I misread the party line there?

And commenting on something else McMenamin says in his article - Elian Gonzales was returned to Cuba because (a) he was an illegal immigrant and (b) his father lived in Cuba. Elian's mother had died; the child goes to his next-of-kin. His father was not abusing him. Darn it, family counts for something!!! One of the few things I agree with Reno on, is returning Elian to his father. It was a family argument that became international news, and Reno (though in a ham-fisted way) resolved the custody issue. Do the political wishes of one group of people override the sanctity of the family? *OOH*, it maketh me angry.

>>end of my tangent rant

[Will Spencer]

This is (another) battle that I hope, for all of our sakes, the government loses.

I had hoped that the end of Janet Reno would mark an up-turn for common-sense law enforcement in this country.

Well, at least that fool John Ashcroft hasn't had a Ruby Ridge or a Waco, yet.