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Stewart's Ex-Broker Files Appeal

By Brooke A. Masters
Washington Post Staff Writer
Thursday, October 21, 2004; Page E02

NEW YORK, Oct. 20 -- Martha Stewart's former stockbroker, Peter E. Bacanovic, told a federal appeals court Wednesday that his right to a fair trial was compromised by being tried alongside his former client.

Bacanovic's lawyers asked the U.S. Court of Appeals for the 2nd Circuit to overturn his convictions for conspiracy, obstruction and lying about the reason for Stewart's December 2001 sale of ImClone Systems Inc. stock. They said the jury was tainted because the it heard "toxic" evidence that was admissible only against Stewart and then held it against Bacanovic.

_____Martha Stewart Coverage_____
Stewart Adjusts With Chef's Touch (The Washington Post, Oct 22, 2004)
Martha Stewart Appeals Conviction (Associated Press, Oct 21, 2004)
Stewart Begins Prison Term (The Washington Post, Oct 9, 2004)
Complete Trial Background

Stewart's spokeswoman said her lawyers would file her appeal by the deadline Wednesday night but did not plan to make it public until Thursday.

Bacanovic, 42, is out on bond while he appeals his convictions, but Stewart, 63, has begun her five-month prison sentence in Alderson, W. Va.

The Bacanovic brief cites numerous newspaper articles alleging that Stewart and ImClone founder Samuel D. Waksal were being investigated for insider trading and the testimony of Stewart's friend Mariana Pasternak, who said Stewart had talked about her sale of ImClone stock.

The former Merrill Lynch broker also argued that his lawyers should have been allowed to delve into alleged drug use by his former assistant, Douglas Faneuil, who was the prosecution's chief witness.

The filing also took U.S. District Judge Miriam Goldman Cedarbaum to task for instructing the jury members that they could meet the legal requirement that there be two witnesses to perjury by relying on a witness and that same witness's notes.

The U.S. attorney's office in Manhattan, which prosecuted both cases, declined to comment.


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