As everyone knows by now, Martha Stewart, convicted of conspiracy and obstruction of justice charges, was sentenced on Friday to five months in a minimum security prison, and five months house arrest (pending appeal).
I have very mixed emotions about the entire ordeal... from the charges to the conviction to the sentencing. And maybe more than the legal issues involved, I am disturbed by the media coverage and presentation of the last two and a half years.
For your consideration:
Print and television media has presented the story in a manner that has led a fair percentage of people to believe that she was convicted of insider trading. In fact, she was convicted (only) of conspiracy and obstruction of justice (yes, those are bad, too).
Ask yourself if you received a telephone call that alerted you to the fact that your stock holdings were about to tank... what would YOU do? I, personally, believe that if anyone has done something wrong (by legal definition... and I'm talking an insider trading crime, which initiated this fiasco), it is the person who placed the call. The receiver of such information, it seems to me, would be a complete (albeit within the letter of the law) moron to retain the tanking stock.
SIDEBAR 1: I recently received an email from a reliable source, notifying me of a lawsuit that was soon to be filed against one of the funds in my 401K investment portfolio. The email clearly stated that the success of the lawsuit would mean a hefty decrease (read tanking) value. And while clearly stating that the intention behind providing this information was not to encourage "dumping", it might be a good time to look at other investment options. Mistake or not, I continue to invest, monthly, in the fund. I confess that I am most certainly NOT an investment expert, and I haven’t' discussed the information with my financial planner. The fund HAS gradually decreased in value, as I continue to purchase more shares each month. QUESTION: Could the email have constituted insider trading? Am I a moronic investor? (OK, maybe the second question is rhetorical!).
SIDEBAR 2: A friend is from a rural area in a southern state. This friend has, on many occasions, reminisced, poetically, about the tastiness of a hometown doughnut. The company slowly begins to expand into new markets, including a shop along my route to work (replete, I swear, with exhaust fans which expel the fresh aroma of sin in a circle, to the surrounding neighborhood). This friend, via hometown connections, learns of nationwide plans of expansion, as well as the intent and date to go public. Is the 'carnal' knowledge of these doughnuts insider trading? [Ok, I know... this sidebar was provided for comic effect... but it really happened and I think, provides an example (albeit far-fetched) of the ease of which you gain information from someone who knows someone, and can ultimately be defined as criminal.] *Footnote: The Company went public, stock value doubled in two weeks and has steadily climbed. Never underestimate the value of a tasty doughnut.
Martha (just plain ole) messed up. She was wrong to attempt to cover her tracks. The charges and convictions have meant that she has lost hundreds of millions of dollars, but can she even miss that amount when she has hundreds of millions more? So, who has suffered most here? I believe the answer to be the employees who lost their jobs... the big and small-time investors in MSLO... and, of course, the common folk who find themselves with an acre of wild vine, leaves of color, and a variety of fruits and nuts... without so much as a clue as to how to create a fall wreath, much less dress a holiday table!
Local News “went to the streets” to gain reactions to Martha’s sentence:
Every person interviewed felt that the sentence was too light. Most added an “if it had happened to me, they’d have put me UNDER the jail” scenario. I challenge that viewpoint, as I have known a few people who have been ruthlessly pursued and convicted of similar white collar crimes by our Federal Government. Each was fined and sentenced to a short period of house arrest, followed by radial proximity arrest, followed by a period of probation. I believe that Martha, by comparison, received her sentence, due in equal parts to her celebrity and a show of power (does “because I could” ring a bell?), colored (read tainted) by her not-so-flattering reputation and stoic (read arrogant) public portrait (which I don’t believe to be a federal crime, in itself, otherwise, the prison system would be bulging at the seams and there would certainly not be an “assistant” on the air!). (please also see below).
A number of people "on the streets" opposed the sentence to a MINIMUM security prison. Come on, people! Do you, sincerely, believe Martha to be a flight risk??? Do you, sincerely, believe a heavier sentence to be the best value for your tax dollar? It is my understanding, too, that because there are so few women in the federal prison system, that minimum security sentences are served in other areas within the confines of standard to maximum security facilities (sans golf courses, tennis courts and luxurious gardens).
Martha is a 62 year-old woman. She wasn’t born with a silver spoon. There’s not a soul alive who could refute the fact that she has gotten herself, her company, and the people who have believed in her along the way, where they are... without self discipline, ingenuity, creativity, big dreams, a sharp business sense and tons of hard work. Is she hardened? Is she arrogant? Who, among us, is to judge her life experience? As a keen observer of human personality traits and behavior, I can tell you that there is a direct and proportionate relationship between outward displays of hardening and arrogance and internal feelings of fear and the capacity to feel intense sorrow and pain. Stoicism and arrogance are survival instincts. They enable the master to both meet great challenge and conceal great sorrow, loss and pain.
Please note, too, that MSLO stock began to rebound the instant the sentence was announced. Investors see the debacle coming, finally, to closure!
The bottom line, in my very humble, common folk opinion is this:
1. Martha has already served a 2-1/2 year sentence. And at the age of 62, that is significant.
Martha didn’t do anything that most of the rest of us wouldn’t do, given the same or similar circumstances.
2. Hypothetically speaking, if you “mess up” without the intent to hurt others, and had the financial means to, quite literally, make it right... should you receive a punishment that affects you personally for the short term, but punishes (exponentially) those who believed and invested in your ideas for much longer?
3. In all your festive heart, don’t you believe Martha Stewart’s many enterprises to be “a good thing”???! Personal note (like the whole blog hasn’t been my personal take): I own a Martha Stewart rake and it, both, works great AND is color coordinated with my several other MS garden implements and patio decor!
Given the choice, had you rather your federal tax dollar be spent in the ruthless pursuit and conviction of:
[a] Osama Bin Laden, international terrorist and all-round bad thing?
or
[b] Martha Stewart, domestic diva and all-round good thing?
The defense rests, but you might also want to visit SaveMartha! as well as MarthaTalks!.
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