Man Without Qualities

Sunday, June 30, 2002

Savaging Martha II

UPDATE: Merrill has given the government a document that appears to support Ms. Stewart's versions of events.


The government's actions against Martha Stewart in connection with her possible insider trading now constitute a kind of "trial by circus."

If regulators think that Ms. Stewart broke the law, then let them convey the evidence they have to a grand jury or bring a civil claim against her.

But it is just idiotic for the matter to be handled as a public, three-ring entertainment by a Congressional committee whose "spokesman" - some character named Ken Johnson - assaults Ms. Stewart daily with media interviews that contain little if any new information, but seem some variety of naked spin control directed at savaging her repuation (and her company's stock price) in apparent despair of any actual enforcement action.

The article linked above, for example, is all about Mr. Johnson's excited revelation that there is "no credible evidence" of Ms. Stewart's purported oral "stop loss" order. Not mentioned in the article is that for many days Ms. Stewart's broker has apparently admitted that his only record of the order were his hand-written notes.

Mr. Johnson does not find those 'credible". Fine. But that is not new or news. It's spin when it comes from Mr. Johnson's mouth, and it's spin when the media runs the story.

And it should stop. The only reasonable conclusion one can reach from the continued circus is the government's conclusion that it can bring neither a criminal nor even a civil charge against Ms. Stewart. If so, the government should just move on.

Admitted, unsupported slander and campaigns of innuendo are not enforcement mechanisms available to the SEC, Congress or the Justice Department in suspected insider trading cases.

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