Most Talked-About Controversies Linked to Martha Stewart

A closer look at the most debated and controversial moments involving Martha Stewart.

Martha Stewart is an American businesswoman, writer, and television personality best known as the founder of Martha Stewart Living Omnimedia. Her empire encompasses publishing, broadcasting, merchandising, and e-commerce. She achieved widespread success through her books, Martha Stewart Living magazine, and television programs like Martha Stewart Living and The Martha Stewart Show. Though her career experienced a setback due to a conviction, Stewart rebuilt her brand and continues to be a prominent figure in the world of home and hospitality.

Sections (5)

Full Timeline Early Life & Education Career & Achievements Challenges & Struggles Controversies & Scandals

December 27, 2001: Sale of ImClone Systems Stock

On December 27, 2001, Martha Stewart sold all 3,928 shares of her ImClone Systems stock. According to the SEC, she avoided a loss of $45,673 by selling the stock after receiving nonpublic information.

June 25, 2002: Grilled on The Early Show about ImClone

On June 25, 2002, CBS anchor Jane Clayson questioned Martha Stewart about ImClone during her regular segment on The Early Show. Stewart responded by continuing to chop cabbage and said, "I want to focus on my salad."

October 3, 2002: Resignation from NYSE Board of Directors

On October 3, 2002, Martha Stewart resigned from her position on the board of directors of the New York Stock Exchange. This followed a deal prosecutors made with Douglas Faneuil related to the ImClone case.

June 4, 2003: Indictment by Grand Jury

On June 4, 2003, Martha Stewart was indicted by a grand jury on nine counts, including charges of obstruction of justice. She stepped down as CEO and Chairwoman of MSLO but remained as chief creative officer.

January 2004: Start of Trial

In January 2004, Martha Stewart's trial began. Prosecutors presented evidence that Peter Bacanovic had informed Stewart about ImClone's CEO selling his shares in advance of an adverse FDA ruling.

March 2004: Guilty Verdict in Trial

In March 2004, after a six-week jury trial, Martha Stewart was found guilty of felony charges including conspiracy to obstruct, obstruction of an agency proceeding, and making false statements to federal investigators.

July 2004: Sentencing for Felony Charges

In July 2004, Martha Stewart was sentenced to a five-month term in a federal correctional facility and a two-year period of supervised release for her felony convictions.

2004: Confinement in Federal Prison Camp

In 2004, Martha Stewart was confined in Federal Prison Camp in Alderson, West Virginia, despite her wish to be incarcerated in Connecticut or Florida. The remoteness of the location was noted as potentially difficult for her then-90-year-old mother to visit.

2004: MSLO Shareholder Derivative Suit

In 2004, Monica Beam, a shareholder of MSLO, brought a derivative suit against Martha Stewart and other directors and officers of the company. The case was ultimately dismissed by the Supreme Court of Delaware.

March 2005: Release from Federal Prison

In March 2005, Martha Stewart was released from federal prison after serving five months for felony charges related to the ImClone stock trading case. She was convicted of fraud.

August 2006: Settlement with SEC

In August 2006, the SEC announced a settlement in the civil case against Martha Stewart. She agreed to disgorge $58,062 and pay a civil penalty of $137,019, as well as a five-year ban from serving as an officer of any public company.

June 2008: Visa Refusal by UK Border Agency

In June 2008, the UK Border Agency refused to grant Martha Stewart a visa to enter the United Kingdom due to her criminal conviction for obstructing justice. She had planned to speak at the Royal Academy.