|
(snip)
Let's take the collateral damage. In sharp contrast to the other corporate scandals playing out in America's courtrooms, this is not about a CEO looting the corporate kitty for his personal enrichment (Tyco); creating shell accounts off-the-books to hide dubious debts and transactions (Enron); or even grossly betraying a fiduciary trust to shareholders (ImClone) as Sam Waksal did. It wasn't even about the company over which Miss Stewart presides, Martha Stewart Living Omnimedia. It was about the private sale of a stock to whose shareholders she had no fiduciary obligation.
Maybe there's some rough justice in putting Miss Stewart in an orange jumpsuit for fibbing about the circumstances of that sale with her broker. Manifestly the jury thought so. But in a case ostensibly brought on behalf of sticking up for the forgotten "little guy," we'd like to think prosecutors might have weighed the price paid by the truly innocent here: all the Martha Stewart Living shareholders, employees, executives, and so forth whose livelihoods have suffered tremendously since this case first broke into the headlines and whose futures, like their company, are now in limbo. And it's not just Miss Stewart's company: Kmart, a big buyer of Martha's products, is going to take a hit too.
We also have doubts about what "message" this conviction really does send about lying. In hindsight we can now see that had Miss Stewart said absolutely nothing at all when investigators came calling, she would not be facing jail time today.
(snip)
Finally, we come to a point we've stressed before: the absence of an underlying crime. Most of the charges against Miss Stewart were brought under Title 18, Section 1001 of the U.S. Code, which makes it a crime to lie to investigators. The dangers for overreach here should be obvious, and comments made back in 1996 by Supreme Court Justice Ruth Bader Ginsburg and recently unearthed by the New York Sun now look prophetic.
"The prospect remains that an overzealous prosecutor or investigator -- aware that a person has committed some suspicious acts, but unable to make a criminal case -- will create a crime by surprising the subject, asking about those acts, and receiving a false denial," Justice Ginsburg wrote in a concurring opinion in Brogan v. United States, warning against the "sweeping generality" of Section 1001's language.
(snip)
|