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American Morning

Interview With Charles Gasparino, Andy Borowitz

Aired June 04, 2003 - 09:15   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


DARYN KAGAN, CNN ANCHOR: Martha Stewart is bracing for a criminal indictment. It could come as early as today. Stewart says that she's ready to fight if and when she is charged in an insider trading scandal. A statement yesterday from her attorney said this: "If Martha Stewart is indicted, she intends to declare her innocence and proceed to trial."
Here to talk about Martha's mess and why this scandal has legs, so to speak, Charles Gasparino of the "Wall Street Journal," Andy Borowitz of the Borowitzreport.com and our own legal analyst, Jeffrey Toobin.

Charles, we're going to start with you.

CHARLES GASPARINO, "THE WALL STREET JOURNAL": OK.

KAGAN: Just how much trouble is Martha Stewart in?

GASPARINO: I think she could go to jail. You know, there are minimum sentencing guidelines. Larry Thompson, the head of the white collar criminal division of the Justice Department, set those down recently and said basically he doesn't want the Justice Department basically to back off those minimum sentencing guidelines. And, you know, that's jail time when it comes to certainly obstruction, certainly insider trading.

We have to see exactly how many counts. I hear there are four counts and four counts of criminal misconduct usually means jail.

KAGAN: Serious stuff.

GASPARINO: Yes.

KAGAN: Jeff, talk about taking the bulls by the horn here. It was none other than Martha's own company who came out and announced that this indictment was pending. That's kind of unusual to do it that way, isn't it?

JEFFREY TOOBIN, CNN LEGAL ANALYST: Well, I think they are worried about having insider information about their own company. They are obligated to say when material information is coming out that would affect their company. Obviously the indictment of the CEO, much less a CEO who's so completely identified with the company, as soon as they know, they're obligated to tell the market that they, that this news is coming. And, by the way, when they send a target letter like that, that's what prompted this, 99 times out of 100 an indictment follows. So she is... KAGAN: So they're not kidding around?

TOOBIN: She is definitely getting indicted.

KAGAN: So what are her options at this point?

TOOBIN: She can still work out a plea. You can always work out a plea at the last minute. But basically at this point the option is to go to trial and try to win.

KAGAN: It's got (UNINTELLIGIBLE).

TOOBIN: I mean that's really about it.

KAGAN: Andy, your thoughts on Martha, the defendant?

ANDY BOROWITZ, BOROWITZREPORT.COM: Well, I mean this is the long awaited road map to prison for Martha Stewart and, you know, I think people shouldn't be so giddy about this trial or the perp walk, for that matter, because somebody has to first physically arrest Martha Stewart, which will not be an easy task, because we know that she has access to the world's finest knives and a glue gun. So this could be kind of difficult.

KAGAN: It could get ugly.

BOROWITZ: As in Iraq, the most difficult part of this may lie ahead.

KAGAN: And a regime change in Omnimedia.

BOROWITZ: That's it.

KAGAN: OK. Charles, well, you broke the story last year about the...

BOROWITZ: By the way, I can't top this.

KAGAN: No, I know. It's a tough act to follow. So we're going to go more on a straight line here. But you did have a big coup last year in breaking the story about the assistant at Merrill Lynch

GASPARINO: Right, and the obstruction charges.

KAGAN: Exactly.

GASPARINO: It was myself and Jerry Marcom (ph), who's now at the "Washington Post."

KAGAN: It's taken a year here.

GASPARINO: Right.

KAGAN: How damaging are those other cases going to be to Martha Stewart? GASPARINO: This is really damaging. I mean the stock is getting killed. Her reputation is in tatters. And, you know, today -- and today, I think, is going to be the perp walk. I mean if this thing, if there's not a last minute settlement, she's going to have to turn herself in. I don't know about handcuffs, but she's certainly going to be flanked by U.S. attorneys...

KAGAN: Maybe with a little lace with a glue gun, perhaps.

(CROSSTALK).

KAGAN: Real quickly all three, from all three of you, and, Jeff, I'll start with you, why Martha? When you look at all the terrible things that have happened from business leaders, when you compare it's just not as significant.

TOOBIN: Well, the amount of money is small. You're talking about a profit that she made allegedly of $47,000 and a woman who at one point was a billionaire. This was a legitimate case to investigate. There's no question there were grounds for investigation here given how it came out. Whether this is a provable case, I am certainly yet to be persuaded. But it looks like 12 people in lower Manhattan are going to decide whether Martha is guilty or not guilty.

KAGAN: Andy, we'll give you the last word and the last laugh. Picking on Martha?

BOROWITZ: Well, I just don't think Martha has to worry about prison. I do think, however, that prison has to worry about Martha. I do think that's a question. I think that -- I think a lot prisoners across the female prison community are drawing straws right now to see who would have to room with her (UNINTELLIGIBLE).

KAGAN: Well, they would have the best designed cells.

BOROWITZ: Absolutely.

(CROSSTALK)

BOROWITZ: That's very true.

KAGAN: You've got to give her that.

BOROWITZ: And that's a good thing.

KAGAN: And that would be a good thing.

BOROWITZ: Absolutely.

KAGAN: Not for Martha, however.

Gentlemen, thank you very much.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com







Aired June 4, 2003 - 09:15   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
DARYN KAGAN, CNN ANCHOR: Martha Stewart is bracing for a criminal indictment. It could come as early as today. Stewart says that she's ready to fight if and when she is charged in an insider trading scandal. A statement yesterday from her attorney said this: "If Martha Stewart is indicted, she intends to declare her innocence and proceed to trial."
Here to talk about Martha's mess and why this scandal has legs, so to speak, Charles Gasparino of the "Wall Street Journal," Andy Borowitz of the Borowitzreport.com and our own legal analyst, Jeffrey Toobin.

Charles, we're going to start with you.

CHARLES GASPARINO, "THE WALL STREET JOURNAL": OK.

KAGAN: Just how much trouble is Martha Stewart in?

GASPARINO: I think she could go to jail. You know, there are minimum sentencing guidelines. Larry Thompson, the head of the white collar criminal division of the Justice Department, set those down recently and said basically he doesn't want the Justice Department basically to back off those minimum sentencing guidelines. And, you know, that's jail time when it comes to certainly obstruction, certainly insider trading.

We have to see exactly how many counts. I hear there are four counts and four counts of criminal misconduct usually means jail.

KAGAN: Serious stuff.

GASPARINO: Yes.

KAGAN: Jeff, talk about taking the bulls by the horn here. It was none other than Martha's own company who came out and announced that this indictment was pending. That's kind of unusual to do it that way, isn't it?

JEFFREY TOOBIN, CNN LEGAL ANALYST: Well, I think they are worried about having insider information about their own company. They are obligated to say when material information is coming out that would affect their company. Obviously the indictment of the CEO, much less a CEO who's so completely identified with the company, as soon as they know, they're obligated to tell the market that they, that this news is coming. And, by the way, when they send a target letter like that, that's what prompted this, 99 times out of 100 an indictment follows. So she is... KAGAN: So they're not kidding around?

TOOBIN: She is definitely getting indicted.

KAGAN: So what are her options at this point?

TOOBIN: She can still work out a plea. You can always work out a plea at the last minute. But basically at this point the option is to go to trial and try to win.

KAGAN: It's got (UNINTELLIGIBLE).

TOOBIN: I mean that's really about it.

KAGAN: Andy, your thoughts on Martha, the defendant?

ANDY BOROWITZ, BOROWITZREPORT.COM: Well, I mean this is the long awaited road map to prison for Martha Stewart and, you know, I think people shouldn't be so giddy about this trial or the perp walk, for that matter, because somebody has to first physically arrest Martha Stewart, which will not be an easy task, because we know that she has access to the world's finest knives and a glue gun. So this could be kind of difficult.

KAGAN: It could get ugly.

BOROWITZ: As in Iraq, the most difficult part of this may lie ahead.

KAGAN: And a regime change in Omnimedia.

BOROWITZ: That's it.

KAGAN: OK. Charles, well, you broke the story last year about the...

BOROWITZ: By the way, I can't top this.

KAGAN: No, I know. It's a tough act to follow. So we're going to go more on a straight line here. But you did have a big coup last year in breaking the story about the assistant at Merrill Lynch

GASPARINO: Right, and the obstruction charges.

KAGAN: Exactly.

GASPARINO: It was myself and Jerry Marcom (ph), who's now at the "Washington Post."

KAGAN: It's taken a year here.

GASPARINO: Right.

KAGAN: How damaging are those other cases going to be to Martha Stewart? GASPARINO: This is really damaging. I mean the stock is getting killed. Her reputation is in tatters. And, you know, today -- and today, I think, is going to be the perp walk. I mean if this thing, if there's not a last minute settlement, she's going to have to turn herself in. I don't know about handcuffs, but she's certainly going to be flanked by U.S. attorneys...

KAGAN: Maybe with a little lace with a glue gun, perhaps.

(CROSSTALK).

KAGAN: Real quickly all three, from all three of you, and, Jeff, I'll start with you, why Martha? When you look at all the terrible things that have happened from business leaders, when you compare it's just not as significant.

TOOBIN: Well, the amount of money is small. You're talking about a profit that she made allegedly of $47,000 and a woman who at one point was a billionaire. This was a legitimate case to investigate. There's no question there were grounds for investigation here given how it came out. Whether this is a provable case, I am certainly yet to be persuaded. But it looks like 12 people in lower Manhattan are going to decide whether Martha is guilty or not guilty.

KAGAN: Andy, we'll give you the last word and the last laugh. Picking on Martha?

BOROWITZ: Well, I just don't think Martha has to worry about prison. I do think, however, that prison has to worry about Martha. I do think that's a question. I think that -- I think a lot prisoners across the female prison community are drawing straws right now to see who would have to room with her (UNINTELLIGIBLE).

KAGAN: Well, they would have the best designed cells.

BOROWITZ: Absolutely.

(CROSSTALK)

BOROWITZ: That's very true.

KAGAN: You've got to give her that.

BOROWITZ: And that's a good thing.

KAGAN: And that would be a good thing.

BOROWITZ: Absolutely.

KAGAN: Not for Martha, however.

Gentlemen, thank you very much.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com