BC-MARTHASTEWART:ND – nation (880 words)

Stewart gets 5 months in prison, probation

By Patricia Hurtado

Newsday

NEW YORK – Martha Stewart, who built a multimillion-dollar home-decorating empire, was sentenced Friday to five months in prison and a $30,000 fine for her role in a stock selling scandal by a federal judge who said Stewart had “suffered and will continue to suffer enough.”

Stewart, who asked U.S. District Court Judge Miriam Goldman Cedarbaum to spare her from prison, emerged from the Foley Square courthouse to make an impassioned statement to a crowd of several hundred.

“I will be back,” she said. “Whatever I have to do in the next few months, I hope the months go by quickly. I am used to all kinds of hard work, as you know.”

She also decried her prosecution and then, to the surprise of many, urged people to buy her products.

“I am just very, very sorry that it has come to this,” Stewart said, a hint of bitterness over being criminally prosecuted for doing something she does not believe is wrong. “That a small personal matter has been able to be blown out of all proportion, and with such venom and such gore. I mean it’s just terrible.”

Then, with an eye on the impact the scandal has had on the stock of her company, Martha Stewart Living Omnimedia, she launched into a sales plug for her products.

“Perhaps all of you out there can continue to show your support by subscribing to our magazine, by buying our products, by encouraging our advertisers to come back in full force to our magazines,” she said.

Stewart, who declared in her high-school yearbook, “I do as I please and I do it with ease,” was accompanied to court Friday by her daughter Alexis, son-in-law John Cuti and her lawyers. Although such celebrities as Rosie O’Donnell, Brian Dennehy and Bill Cosby attended the trial, none attended Friday’s proceeding.

Stewart was convicted in March of conspiracy, obstruction and two counts of making false statements stemming from her Dec. 27, 2001, sale of nearly 4,000 shares of ImClone stock. Prosecutors said she conspired with her former broker, Peter Bacanovic, to concoct a cover story explaining why she sold the stock just before a government announcement sent the price plummeting.

In sentencing Bacanovic Friday afternoon, the judge imposed the exact same term of five months’ imprisonment, but ordered Bacanovic to pay a $4,000 fine.

During Stewart’s sentencing, her lead trial lawyer, Robert Morvillo, asked that she be sentenced to probation and be allowed to work with underprivileged women, citing “the punishment that Martha Stewart has already endured.”

Morvillo, who called Stewart a phenomenon, quoted from a few of what he said were more than 1,500 letters Stewart’s supporters wrote Cedarbaum.

“She has brought a measure of beauty to our everyday world,” he said. “Martha Stewart did a great service to millions of women. She took part of our lives that was pure drudgery and elevated it to an art form.”

Stewart then rose and in the modulated voice that is well known to her TV viewers, spoke for the first time in court.

“Today is a shameful day,” she told Cedarbaum. “You are faced with a conundrum, a problem of monumental, to me, proportions. What to do? I ask that, in judging me, you remember all the good that I have done, all the contributions I have made through the company I have founded … My heart goes out to you.”

Her voice then grew thick with emotion as she concluded: “My hopes that my life will not be completely destroyed lie entirely in your competent and experienced and merciful hands. Thank you and peace be with you.”

Cedarbaum, who had listened intently to Stewart, told her she did not believe she merited probation but a minimum sentence.

Cedarbaum gave four reasons for imposing a term at the bottom of the federal sentencing guidelines, which had called for 10 to 16 months in prison.

Cedarbaum cited Stewart’s lack of a prior criminal record, the letters she had received, the fact that she believed that “public interest objective” had been served already through the trial and conviction.

“Finally,” Cedarbaum concluded, “I believe that you have suffered and will continue to suffer enough.”

She agreed to recommend that Stewart serve the term at the minimum-security federal prison camp for women in Danbury, Conn.

Cedarbaum also ordered Stewart to serve two years’ supervised release, with five of those months confined to her home. Stewart said she would like to be confined to her 152-acre property in Bedford, N.Y., which has five houses on it, including one built in 1784.

Cedarbaum allowed Stewart and Bacanovic to remain free on their own recognizance pending appeal.

Bacanovic’s lawyer, Richard Strassberg, had also asked for a probationary term.

He told Cedarbaum that “Peter has lost it all” and noted that Bacanovic was fired from Merrill Lynch and is in debt as a result of the case.

“I deeply regret the pain and suffering this case has caused, Bacanovic told the judge. “Maybe there is a possibility I can pick up the pieces of my life.”

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(Galia Garcia-Palafox contributed to this report.)

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(c) 2004, Newsday.

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Distributed by Knight Ridder/Tribune Information Services.

AP-NY-07-16-04 2034EDT