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News
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Martha hands over docs
Complying with Congress, Stewart turns over records related to ImClone.
August 20, 2002: 8:30 PM EDT

NEW YORK (CNN/Money) - About 1,000 pages of documents detailing Martha Stewart's phone calls and e-mails have been delivered to a congressional panel looking into whether the high-profile CEO illegally profited from insider information on ImClone Systems.

The documents from Stewart, as well as those of her business manager, have been delivered to the Rayburn House Office Building, where the Committee on Energy and Commerce has its offices.

A spokesperson for Rep. James Greenwood, a Pennsylvania Republican who chairs the House Energy and Commerce investigative subcommittee, said staffers are reviewing the documents to confirm that Stewart has fully complied with their request.

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Stewart sold nearly 4,000 shares of ImClone stock on December 27, when its shares closed at $58.30. They began tumbling the next day when the Food and Drug Administration declined to approve Erbitux, ImClone's much-anticipated cancer drug.

Stewart has denied she had any insider knowledge of the news, saying she had a long-standing agreement with her broker to sell ImClone shares when they hit a certain price.

But her level of cooperation apparently frustrated lawmakers, at least prior to the delivery of documents Tuesday afternoon. The committee had asked for records of all Stewart's phone calls and e-mails between Dec. 1 and Jan. 9 related to ImClone, to Sam Waksal, the former ImClone CEO who is friends with Stewart, and to her Merrill Lynch securities account.

Waksal pled innocent earlier this month to federal charges related to insider trading. According to that indictment, Waksal secretly advised two family members to sell ImClone shares ahead of the FDA news.

Greenwood had raised the threat of a subpoena. That decision could come by Labor Day, he said.

"I'd rather not subpoena Ms. Stewart," Greenwood told CNN/Money earlier Tuesday. "I've extended an invitation to talk with our investigators. I said we'd do that in the place of her choosing in a nonpublic way without advance notice to the press so we wouldn't have paparazzi there. But she's declined to do that."

Calling Stewart, who runs a media company focusing on homemaking and design, before Congress would draw intense public scrutiny.

Before seeing the latest documents, Greenwood said his investigators have found no evidence to support Stewart's claim that the sale of the shares was triggered by a pre-arranged "stop-loss" arrangement with her broker.

He also said investigators will be looking through the information Stewart is providing to see if there is evidence she knew of the pending FDA action or the sale of family shares by Samuel Waksal.

Shares of Stewart's company, Martha Stewart Living Omnimedia (MSO: Research, Estimates), rose 91 cents to $9.05 Tuesday, narrowing their year-to-date loss to 45 percent. They've held up better than ImClone (IMCL: Research, Estimates), which is off 82 percent this year.  Top of page




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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.