I am curious about the law regarding insider trading.
Ms. Stewart was apparently she is a friend of an officer of the ImClone company, who may or may not have leaked information to her which may or may not have caused her to dump the stock in a timely manner. If the friend has a legal duty to keep certain information confidential, he is clearly in trouble. But I am not certain about Ms. Stewart. She is not an officer of the ImClone, and owes the company no fiduciary duty. So where is the crime?
If I am on a bus and I overhear a conversation between two officers of XYZ corporation, and dump my stock on that basis, have I committed insider trading? How is this different?
I recall hearing a legal commentator on NPR or somewhere claiming that even if she did everything that she is alleged to have done, was no crime. Obviously the prosecutors disagree (or may just be chasing headlines – not without precedent).
Elf was commented on the poster who created the OP. So far, his posts have invariably consisted of a single short paragraph followed by his catchphrase : “and that’s the bottom line”.
And she’s right (or he’s right - I’m guessing elf is female as the username “sounds female” to me, but I’ve been wrong before) the catch phrase is lame. It’s also just plain stupid. He didn’t offer an opinion on anything, so how can it be the last word? OPs are a starting point for a discussion, and thus are never “the bottom line” either literally or figuratively.
As to Queen Martha, I’ve never understood her popularity. A lot of her stuff is tacky. I’ve only seen her show a couple of times, but remember thinking “…why?”. The particular one I have in mind was a Halloween episode where she made Chinese lanterns out of construction paper. That’s how 2nd graders decorate their classroom. There’s a reason she sells her stuff at K-Mart.
Then there’s this from Missy’s link:
Ugh. I’m not going to comment on her possible criminal misdeeds, but the woman needs to be hit in the face with a cream pie thrown by an out of work, sexually aggressive, drunken clown just for talking like that.
You got it. Just some one-trick pony playa hatin’ You just set it forth in a much clearer manner. Also I’m a he, FWIW.
Martha may have done something stupid by insider trading, but the bigger issue is that she appeared to repeatedly lie about it, which just annoys the hell of the SEC et al and makes it more likely that they will try and make an example out of you.
I never really had any opinions either way about Martha Stewart until I was stuck on an airplane and forced to watch her on Letterman on one of those itty bitty TV monitors.
She was a total bitch. On TV. Letterman was trying to mess around and be, you know, funny (considering that’s what he does and it was his show) and she kept snapping at him. “Pay attention! No, it’s like this!” Wow. If she’s like that with the cameras on, imagine what she’d be like with them off. Then I watched that movie a few weeks ago about her. Hot damn, that woman’s a bitch (if what they were portraying was in fact true, from what I saw on Letterman, it was certainly easy to buy.)
Anyhoo, my point is that even though IMHO she’s a grade A bitch, I don’t see what she did as illegal either. She wasn’t employed by the company, she was an outsider. How can an outsider be guilty of “inside” trading?
Of course, I’m still more than happy to watch her squirm.
The difference is that you just overheard it, as opposed to being told directly by an insider.
Back when Barry Switzer coached at OU, he was brought up on insider trading charges. His defense was that he overheard confidential information being discussed by the director of an oil company executive and the executive’s wife while attending a track meet. Switzer walked.
I’m reasonably sure that if you’re one of the folks that bought ImClone stock from Martha the day it tumbled, you’d want her head on an embroidered cashmere throw. Her allegedly illegal gain came directly out of the pockets of investors with less than perfect information. That undermines the very foundation that the stock market is built upon.
As far as why she’s guilty of a crime, look at it this way… she’s an accessory to grand theft, in a way. If someone committed a crime, say robbing a bank, and you took some of the money, knowing full-well it was ill-gotten gains, you’d be an accessory to robbery. This really is no different, assuming a jury finds her guilty of what she’s accused.
Indictment: Its a Good thing.
Martha’s just an insider trading Bitch who sold her stock on information that neither you nor I had a chance at. As our shares sold lower than they would have if the playing field were level, She Stole Our Money by using an unfair competitive advantage.
The fact that she’s the epitome of the ‘perfect household judgemental bitch’ who looks down her nose at you and I on a daily basis merely makes the sauce for her cooked goose so much sweeter. Think of the woman’s face in that Lexus who flipped you the bird as she cut you off in traffic: Didn’t she have the Martha Stewart hair and clothes? Martha represents an Entire Culture of Evil Stepford house-fraus, and while we can’t indict the entire culture, we certainly Can and Have indicted her for the crime that she commited. I just hope the trial is held in Buffalo, NY. Anyway, here’s what Martha had to say about it.
Jail: Now That’s what I call “Martha Stewart Living”…
To be fair, there were any number of other ImClone shareholders without inside information who were perfectly willing to sell on the same day Stewart sold her shares at the same market price. The notion that ImClone purchasers on that day were screwed by Martha Stewart is laughable – if Stewart hadn’t sold, they would have bought their shares from another ImClone shareholder at essentially the same price (Stewart wasn’t selling enough shares to materially alter the market price overall).
More specifically: I think (just think, mind you) Martha is allegedly a “tippee”. Tippees can be held liable if (1) the insider who gained the information breached his fiduciary duty to the shareholders by disclosing the information to the tippee, and (2) the tippee knows or should know of the breach. If the insider will benefit, directly or indirectly, from the disclosure, the insider has breached his fiduciary duty. Absent this breach, there is no derivative breach by the tippee.
According to the article that dantheman linked to, the indictment does NOT charge her with an offense related to the sale of the ImClone stock, but rather with her behavior towards the investigation into those events. I’m curious if these will stick if they can’t prove the original offense. She may get off under the Bill Clinton “Yeah, I lied, but only about a question they shouldn’t have asked” exemption.
