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Politics : Politics for Pros- moderated -- Ignore unavailable to you. Want to Upgrade?

To: LindyBill who wrote (26980)	1/29/2004 5:54:46 PM
From: LindyBill	Read Replies (2) \| Respond to of 793957

The case against Martha is falling apart. Judge Blocks Testimony in Stewart Trial The defense accuses prosecutors of failing to turn over notes from an early FBI interview of a witness. By Thomas S. Mulligan LA Times Staff Writer 12:04 PM PST, January 29, 2004 NEW YORK — Testimony by the government's star witness against homemaking doyenne Martha Stewart was delayed to next week after the defense accused prosecutors of withholding until the last minute important information about the stock sale at the center of the case. The witness, Douglas Faneuil, had been scheduled to testify today in the fraud and obstruction of justice trial of Stewart and her former stockbroker, Peter Bacanovic, in U.S. District Court in Manhattan. Faneuil, a former brokerage assistant at Merrill Lynch & Co., sold nearly 4,000 shares of ImClone Systems stock for Stewart in December 2001. The sale came a day before a regulatory ruling sank the price of ImClone shares. The information provided to the defense Wednesday concerns an interview attorney Jeremiah Gutman had with federal authorities on Jan. 15, 2003, about a conversation he had with Faneuil on Jan. 7, 2002, about 10 days after the stock sale. Gutman had been Faneuil's lawyer at that time. In the interview, Gutman said that when he first spoke to Faneuil, about 10 days after the stock sale, Faneuil said he could not recall whether Bacanovic or ImClone founder Samuel Waksal told Faneuil to contact Stewart. Later in the interview, Gutman, who is in his 80s, acknowledged that his recollection of the year earlier interview with Faneuil was not perfect, according to lead prosecutor Karen Patten Seymour. After a lunch break, U.S. District Judge Miriam Goldman Cedarbaum postponed the trial until Monday. In opening arguments earlier in the week, Seymour told the jury that Stewart sold the stock because Bacanovic, in violation of confidentiality rules, gave her a tip that Waksal was "desperately" trying to dump his stock. Waksal and his family quickly came under investigation for shedding their stock, and the probe spread to others who had sold ImClone stock that day. Stewart and Bacanovic concocted a story that they had previously agreed to sell the shares when the price fell to $60, as it did that day, Seymour said. Bacanovic's attorney, Richard Strassberg, made an impassioned speech to Cedarbaum today, complaining that the prosecution had waited until 10:15 Wednesday night to provide the information about Gutman to the defense. "This is central to their entire case against my client," Strassberg said, adding, "It suggests their entire case may be misplaced." Strassberg called it "very disturbing" that this "clearly exculpatory material" was delivered to the defense at this point, after opening arguments. Strassberg asked the judge to dismiss all charges against the 41-year-old broker, and he asked for a mistrial. Cedarbaum denied the requests. Robert Morvillo, Stewart's lead attorney, asked that Faneuil be barred from testifying. Again, Cedarbaum denied the request. "I do think the government should have turned this information over earlier," Cedarbaum said. She gave the defense time to investigate the information before Faneuil takes the stand; his testimony will be postponed at least until Feb. 5. Although the information concerning Gutman was more favorable to Bacanovic's case, legal experts have said that anything that calls into question Faneuil's credibility is a plus for Stewart.