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Live From...
How Will Martha Weather Prison?; Wildfires in Carson City, Nevada
Aired July 16, 2004 - 13:59 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.
(BEGIN VIDEO CLIP)
MARTHA STEWART, FMR. CEO, MARTHA STEWART LIVING OMNIMEDIA: Today is a shameful day. It's shameful for me, and for my family, and for my beloved company.
(END VIDEO CLIP)
BETTY NGUYEN, CNN ANCHOR (voice-over): Martha Stewart, sentenced to prison and vowing to press on. How will today's developments affect her business and her personal life?
CAROL LIN, CNN ANCHOR (voice-over): And in the same New York courtroom this hour, Stewart's broker will find out the penalty for his part in this legal drama.
NGUYEN: Smoke-filled skies and charred homes on the ground: The West enters the wildfire season with a vengeance.
LIN: And have you seen this man? Secretary of Defense Donald Rumsfeld, usually front and center, seems to be missing in action.
(on camera): From the CNN Center in Atlanta, I'm Carol Lin. Kyra and Miles are off today.
NGUYEN (on camera): And I'm Betty Nguyen. This hour of CNN's LIVE FROM... starts right now.
LIN: "I'll be back," that's what Martha Stewart vows. But even after her sentencing today in federal court in New York, no on really knows when. And that's because Stewart is appealing her conviction and five-month prison term, and the term is on hold until a higher court rules. Martha Stewart also was sentenced today to five months home confinement and two years probation.
We get the latest now from CNN's Allan Chernoff in Manhattan. Allan, you were inside the courtroom. What was it like?
ALLAN CHERNOFF, CNN SR. FINANCIAL CORRESPONDENT: Carol, certainly a very dramatic situation inside of the courtroom. Martha Stewart did not show any apparent reaction when Judge Miriam Cedarbaum gave the sentence. And by the way, that was the minimum sentence that the judge could give under the federal guidelines -- five months in prison, five months of home detention.
But immediately after all the proceedings, Martha Stewart turned to her daughter Alexis, gave her a kiss, and lifted her eyebrows as if to say, "Oh, well." Of course, afterwards, Martha Stewart stepped onto the courthouse right in front of us, the steps, and spoke to the media.
(BEGIN VIDEO CLIP)
STEWART: I will be back. Whatever I have to do in the next few months, I hope the months go by quickly. I'm used to all kinds of hard work, as you know, and I'm not afraid. I'm not afraid, whatsoever.
I'm just very, very sorry that it's come to this -- that a small, personal matter has been able to be blown out of all proportion, and with such venom and such gore. I mean, it's just terrible.
(END VIDEO CLIP)
CHERNOFF: Judge Cedarbaum said that she believes Martha Stewart has suffered and will continue to suffer enough. The judge also said that she had read through the more than 1,500 letters received by the court on Martha Stewart's behalf. And they certainly, apparently, did play a role in getting Martha Stewart that minimum sentence of five months in prison, five months of home confinement.
Now, Ms. Stewart's stockbroker, Peter Bacanovic, is scheduled to be sentenced within the next half hour. Mr. Bacanovic was convicted alongside Martha Stewart in the trial of lying to federal investigators about the true reason for Martha Stewart's sale of ImClone stock -- Carol.
LIN: All right. And he's likely to face similar sentencing -- it's the same sentencing guidelines for him, right?
CHERNOFF: Very similar. But in Mr. Bacanovic's case, he certainly cannot point to all the good deeds, all the contributions to society that, apparently, weighed in Martha Stewart's favor. So, we'll have to see exactly what happens with Peter Bacanovic, coming up shortly.
LIN: Got you. Got you. All right, thanks very much, Allan. We'll hear from you then.
In the meantime, we want to bring you a particular moment with Martha Stewart, because you didn't hear from her at the trial. Her attorneys did not call her up to testify. But she chose the moment today, after her sentencing, to speak out this morning and, in fact, twice. Did so inside and outside the courtroom.
Here's what she said to reporters in its entirety. Listen in.
(BEGIN VIDEO CLIP)
STEWART: Today is a shameful day. It's shameful for me, and for my family, and for my beloved company, and for all of its employees and partners. What was a small, personal matter became, over the last two years, an almost fatal circus event of unprecedented proportions. I have been choked and almost suffocated to death during that time, all the while more concerned about the well-being of others than for myself: more hurt for them and for their losses than for my own; more worried for their futures than the future of Martha Stewart the person.
More than 200 people have lost their jobs at my company as a result of this situation. I want them to know how very, very sorry I am for them and their families. I would like to thank everybody who stood by me, who wished me well, waved to me on the street -- like these lovely people over here -- smiled at me, called me, wrote to me. We received thousands of support letters and more than 170,000 e-mails to marthatalks.com, and I appreciate each and every one of those pieces of correspondence. I really feel good about it.
Perhaps all of you out there can continue to show your support by subscribing to our magazine, by buying our products, by encouraging our advertisers to come back in full force to our magazines. Our magazines are great. They deserve your support.
And whatever happened to me personally shouldn't have any effect whatsoever on the great company, Martha Stewart Living Omnimedia. And I don't want to use this as a sales pitch for my company, but we love that company. We've worked so hard on that company, and we really think it merits great attention from the American public.
And I'll be back. I will be back. Whatever I have to do in the next few months, I hope the months go by quickly. I'm used to all kinds of hard work, as you know, and I'm not afraid. I'm not afraid, whatsoever. I'm just very, very sorry that it's come to this -- that a small, personal matter has been able to be blown out of all proportion, and with such venom and such gore. I mean, it's just terrible.
(END VIDEO CLIP)
LIN: All right. That's what Martha Stewart had to say on the courthouse steps.
Her company, Martha Stewart Living Omnimedia, issued a statement, as well. Remember, Martha Stewart was talking about the 200 employees who had been laid off because of her legal troubles. In part, it says, "Martha Stewart Living Omnimedia is saddened for Martha. As always, she has our full support. Moreover, we are heartened that Judge Cedarbaum recognized Martha's strong public support and her lifetime of contributions to others -- past, present, and future -- that we in the company know so well."
"After 26 months of uncertainty, we see this as an important step toward closure for MSO. In the face of difficult events, our talented employees continue to develop, inspire original how-to information and products for the home. We thank them, our loyal customers and advertisers -- our stalwart distribution and manufacturing partners for sticking with us through these challenging times."
This is a company whose stock is going up today, but clearly concerned about the future.
NGUYEN: Stewart's lawyers insist a number of issues stacked the deck against them, but that doesn't guarantee a new deal from the Court of Appeals.
In fact, our Jeffrey Toobin is betting against it. Right, Jeff? Why is that?
JEFFREY TOOBIN, CNN CORRESPONDENT: Well, you have to remember, for starters, Betty, the vast, vast majority of criminal appeals are unsuccessful. Most people convicted and sentenced to prison stay convicted and stay sentenced to prison. So it's an uphill battle from the start.
Also, Judge Cedarbaum's a very respected judge. Martha Stewart had excellent lawyers at her trial. And Judge Cedarbaum ruled for Martha Stewart during this trial in several important ways. So, the idea that she, Martha Stewart, somehow got a raw deal in her trial -- which is what an appeal claims is going to be a long shot.
NGUYEN: But what about the perjury issues, Jeffrey -- the perjury issues? How did that play into the appeal?
TOOBIN: That is certainly the best argument that the -- both Martha Stewart and Peter Bacanovic will have. Very unusual situation here, where a government witness, a Secret Service agent, has been charged with perjury at her trial, and a -- one of the jurors apparently lied during his voir dire while he was being questioned in jury selection.
However, the perjury -- alleged perjury in the case of the Secret Service agent only related to a single document, which didn't really have anything to do with Martha Stewart. And the perjury -- alleged perjury regarding the juror is a very thin reed on which to argue that the whole case should be thrown out.
NGUYEN: Let's talk about this appeals process. How long do you expect it to date -- to take, and should Martha just go ahead and start serving her sentence right now? I mean, wouldn't it be easier?
TOOBIN: Well, that's a good question, because the length of the appeals process is very uncertain. And the one thing Martha Stewart appears to want, and certainly the stock market will want, is certainty. I don't see any way this case will even be argued on appeal until fall, and I think a decision is unlikely much before the first of the year.
So, I think Martha Stewart very likely will not go to prison, if her conviction is affirmed, until sometime during 2005, but certainly not before then. Should she go to prison early? You know, at one level, it seems like she should just get it over with. Five months isn't that long a time.
But in quite a few years of being in the criminal justice system and following the criminal justice system, I have never seen anyone volunteer to go to prison. People wait until the last minute, and Martha Stewart seems to be following in that trend.
NGUYEN: Yes, you can see why. Now, her attorney has already asked that if she goes to prison that they want her to be sent to Danbury, Connecticut, which is close to her home. But you say being female and dealing with a white-collar crime, she's at a disadvantage when it comes to prison.
TOOBIN: Yes, I don't think people really recognize that. There are so many more male white-collar criminals that there are, in fact, a lot of minimum-security prisons for men. There are so few women prisoners in general, and especially white-collar, there is no real separate prison for them. They are lumped in with more high security risk prisoners -- principally narcotics convicts. That's what most women in prison are.
And so, in Danbury, she will be in a higher security prison, less freedom, more restrictions on her comings and goings, you know, in and out of her cell, and she'll be surrounded mostly by people convicted of drug offenses.
NGUYEN: Jeffrey, quickly, we're almost out of time -- but Martha Stewart is already starting to do interviews. In fact, she's speaking with Larry King on Monday and even taking live viewer phone calls. Is that smart, at this point?
TOOBIN: You know, I think for Martha Stewart, at this point, it is all about getting her company back to life and helping her company, less so about the legal system. The appeals process will just go on its own. I actually think it is a smart process, because what the stock market and advertisers need to be assured is that this company will survive. And the only way to do that is to have Martha Stewart out front and center.
It doesn't mean it will survive and thrive, but Martha Stewart being out and in public is the only way it has any chance, I think.
NGUYEN: CNN's Jeffrey Toobin, thank you -- Carol.
LIN: All right. We don't want to forget that we want to hear from you. E-mail your comments to us about Martha Stewart's sentencing, whether it was fair or any other thoughts you have. Our e-mail address is livefrom@cnn.com, and we're going to read them near the end of this hour.
And don't forget, we're still staying tuned for Peter Bacanovic's sentencing. He is Martha Stewart's broker. He faces four similar counts as to Martha Stewart. We saw him as he entered the courthouse earlier today. He's, once again, facing charges on the same offenses of lying and obstructing justice. We're going to bring you the sentence as soon as we get it.
NGUYEN: Thousands of acres charred, hundreds of people forced from their homes by flames. Firefighters in Carson City, Nevada, hope to make headway today on a huge wildfire burning on the north side of town. It's a battle fought in the air and on the ground.
CNN's Ted Rowlands is near the eye of the firestorm and joins us with a look. Hi, Ted.
(BEGIN VIDEOTAPE)
TED ROWLANDS, CNN CORRESPONDENT: As expected, the fire here at Carson City started to move away from threatened homes in -- by midmorning, over a ridge towards the Lake Tahoe area. Firefighters are using an aerial assault to try to stop the movement of this fire. Overnight, they were able to save about 50 homes in a development area that was threatened.
The hope was that the flames would lie down overnight, but they didn't. Firefighters had to actively fight the flames that were shooting as high as 100 feet, consuming more fuel. They were able to save those homes. Fourteen homes, however, have been completely destroyed by this fire, which started on Wednesday.
And although the wind has shifted now, it is expected that the wind will shift again. And those same homes will again be threatened.
KURT FROSDICK, FIRE INTERAGENCY SPOKESMAN: This afternoon, as the winds pickup and go to the southwest, it's going to go back towards those homes again. We're also protecting those homes, setting up strike teams, and clearing out that brush as well.
ROWLANDS: It is expected that firefighters will use an air assault for the rest of the daylight hours here, then overnight. It will be an all night effort as well as they try to keep these homes safe. Up till now, 9,100 acres have been burned in this fire.
Ted Rowlands, CNN, Carson City, Nevada.
(END VIDEOTAPE)
NGUYEN: No doubt they could use some help from Mother Nature. We want to turn now to Meteorologist Orelon Sidney for the latest on the weather. Hi, Orelon.
ORELON SIDNEY, CNN METEOROLOGIST: Betty, thanks a lot. This weekend is going to be kind of a mixed bag. Some things will help and some things will hurt the fire efforts.
Here's your forecast for Carson City, Nevada. I wanted to show you, your temperatures will be close to 90 degrees. The warmer the temperature, the harder it is to fight the fire. Hot temperatures help the fire to spread, make it more difficult.
And then, look at the relative humidities. They actually drop through the weekend. Look, when it gets to 11%, does it really matter if you take a few more percent off? Things are going to be very dry, very hot, but the good news is there's not going to be a lot of wind. Wind can be a big problem, especially when it's over 15 miles an hour in a fire situation.
For today, the peak winds, about 10 miles an hour, five miles an hour on Saturday, and then Sunday, going up to 15 miles an hour. The big problem, of course, is when you have winds that are variable. and that's what we will see this weekend -- not just looking at winds steadily from one direction, but coming from several directions. That makes it difficult to find out where the embers from the fires will land. And of course, then you have homes threatened in many different directions.
It's going to be a very hard fire to fight. It's going to be a very rough weekend out in the west. Betty, Carol?
NGUYEN: Definitely. Thank you, Orelon.
SIDNEY: You're welcome.
NGUYEN: Carol?
LIN: All right. Thanks much.
An accused sniper found mentally fit to stand trial. That story tops our look at news across America.
A psychiatrist says Charles McCoy, Jr. is competent to stand trial on charges that he was firing at cars for a period of time in Ohio. He is also accused of killing a 62-year-old woman.
Now, this is a 28-year-old man who suffers from paranoid schizophrenia. He has pleaded not guilty right now to 24 counts. His trial is set for January.
Top secret work comes to a grinding halt. The extraordinary stand down at Los Alamos National Laboratory follows the disappearance of two classified storage devices last week. A complete inventory of sensitive material is expected to be completed within days. So, they still don't really know exactly what's missing.
Mourning "Bobo" -- dozens of people gathered in Florida last night for this candlelight vigil honoring an escaped tiger that was shot and killed earlier this week. The officer who shot the tiger says he acted in self-defense.
NGUYEN: Now, here's an interesting question for you: Will Medicare start paying for liposuction? How Medicare's decision to treat obesity as a disease could affect healthcare insurance for all Americans. That's ahead on LIVE FROM...
And show of support: Senator John McCain joins the vice president in a battleground state.
Plus: When battlegrounds become playgrounds -- the life and death game for the children in the Middle East.
(COMMERCIAL BREAK)
NGUYEN: Arizona Senator John McCain is hitting the campaign trail in support of the Republican presidential ticket. He and Vice President Cheney are in Michigan at this hour, attending a rally in Lansing. Their visit comes just three days after President Bush made a campaign stop in Marquette, Michigan. From there, Cheney moves on to Waterloo, Iowa.
Well, John Kerry is making a promise to America's teachers. He says, if elected, he'll put as much money behind the nation's education reforms as allowed by law. The Democratic presidential hopeful speaks next hour to the American Federation of Teachers National Convention, which is taking place in Virginia. This evening, he'll attend a rally in Arlington, Virginia.
LIN: And John Kerry's running mate is pressing on with his solo campaign efforts, arriving in Los Angeles about an hour ago. Our Kelly Wallace spoke to the VP hopeful earlier about what he's doing on the road to help John Kerry become president.
(BEGIN VIDEO CLIP)
SEN. JOHN EDWARDS (D-NC), VICE PRESIDENTIAL CANDIDATE: I can talk about things that he can't naturally talk about. I mean, he can say that he served in Vietnam, but he can't talk in the sort of passionate way I can about what it means about his values and his beliefs that the men who served with him adore him and respect him and look up to him, even now, 30 years later.
(END VIDEO CLIP)
LIN: And John Edwards is going to be talking to a group of Latino voters at a banquet tonight.
A liberal advocacy group will have its anti-war billboard up in New York Times Square in time for the Republican convention. Clear Channel Communications initially rejected the billboard, which shows a bomb image and the text, "Democracy is best taught by example, not war."
So, Project Billboard is replacing the bomb image with a peace dove. The group had accused Clear Channel of rejecting the image for political reasons, but the media company says it thought the bomb was insensitive in a city hit so hard by terrorism.
NGUYEN: Broker busted, now he's going to be sentenced. Martha Stewart's ex-broker, Peter Bacanovic, finds out his fate in just a few minutes. We'll bring that to you as soon as we get word.
RHONDA SCHAFFLER, CNN FINANCIAL CORRESPONDENT: I'm Rhonda Schaffler, LIVE FROM... the floor of the New York Stock Exchange, where shares of Martha Stewart's company are soaring. Details from LIVE FROM... continues after the break.
(COMMERCIAL BREAK)
LIN: All right, you're looking at the courthouse steps at the federal courthouse in New York, where we are expecting Martha Stewart's stockbroker, Peter Bacanovic, to be sentenced at any moment. He is facing four counts of obstruction of justice and lying during the investigation of the ImClone stock sale. We're going to bring that to you shortly.
NGUYEN: In the meantime, one big man may be gone from the Lakers' lineup, but star player Kobe Bryant will be back. He has signed a new seven-year contract worth more than $136 million. Bryant briefly flirted with another team -- several other teams, becoming a free agent after the Lakers lost to Detroit in the NBA finals.
Coach Phil Jackson was let go shortly after that, and star center Shaquille O'Neal demanded a trade. He'll play for the Miami Heat starting next season.
LIN: And basketball fan, and controversial director, Spike Lee is staying firmly by the side of his friend Bill Cosby, who's rocked the boat, saying African-Americans aren't ambitious and need to stop blaming the white man for their problems.
I sat down with Spike Lee, who told me that African-Americans cannot ignore what is at stake.
(BEGIN VIDEO CLIP)
SPIKE LEE, FILM DIRECTOR: It's serious now. I mean, we've got to take off the kid gloves, because you have to realize we're at a point where it's not just a matter that a large segment of African- American kids can't read or write. It's the fact they don't want to learn to read or write, because somehow, they've been told that education is acting white.
(END VIDEO CLIP)
LIN: Spike talked about a lot of things. So, please, tune in to my prime time show Sunday night at 10 p.m. where you're going to see what else Spike had to say about morality, lesbians, Democrats, Republicans and, most important -- to him at least -- his kids.
NGUYEN: He runs the whole gamut. Very interesting, looking forward to that.
Well, Martha Stewart will be heading to prison if her appeal fails. But investors in her company are breathing a big sigh of relief...
(MARKET REPORT)
(COMMERCIAL BREAK)
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Aired July 16, 2004 - 13:59 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
MARTHA STEWART, FMR. CEO, MARTHA STEWART LIVING OMNIMEDIA: Today is a shameful day. It's shameful for me, and for my family, and for my beloved company.
(END VIDEO CLIP)
BETTY NGUYEN, CNN ANCHOR (voice-over): Martha Stewart, sentenced to prison and vowing to press on. How will today's developments affect her business and her personal life?
CAROL LIN, CNN ANCHOR (voice-over): And in the same New York courtroom this hour, Stewart's broker will find out the penalty for his part in this legal drama.
NGUYEN: Smoke-filled skies and charred homes on the ground: The West enters the wildfire season with a vengeance.
LIN: And have you seen this man? Secretary of Defense Donald Rumsfeld, usually front and center, seems to be missing in action.
(on camera): From the CNN Center in Atlanta, I'm Carol Lin. Kyra and Miles are off today.
NGUYEN (on camera): And I'm Betty Nguyen. This hour of CNN's LIVE FROM... starts right now.
LIN: "I'll be back," that's what Martha Stewart vows. But even after her sentencing today in federal court in New York, no on really knows when. And that's because Stewart is appealing her conviction and five-month prison term, and the term is on hold until a higher court rules. Martha Stewart also was sentenced today to five months home confinement and two years probation.
We get the latest now from CNN's Allan Chernoff in Manhattan. Allan, you were inside the courtroom. What was it like?
ALLAN CHERNOFF, CNN SR. FINANCIAL CORRESPONDENT: Carol, certainly a very dramatic situation inside of the courtroom. Martha Stewart did not show any apparent reaction when Judge Miriam Cedarbaum gave the sentence. And by the way, that was the minimum sentence that the judge could give under the federal guidelines -- five months in prison, five months of home detention.
But immediately after all the proceedings, Martha Stewart turned to her daughter Alexis, gave her a kiss, and lifted her eyebrows as if to say, "Oh, well." Of course, afterwards, Martha Stewart stepped onto the courthouse right in front of us, the steps, and spoke to the media.
(BEGIN VIDEO CLIP)
STEWART: I will be back. Whatever I have to do in the next few months, I hope the months go by quickly. I'm used to all kinds of hard work, as you know, and I'm not afraid. I'm not afraid, whatsoever.
I'm just very, very sorry that it's come to this -- that a small, personal matter has been able to be blown out of all proportion, and with such venom and such gore. I mean, it's just terrible.
(END VIDEO CLIP)
CHERNOFF: Judge Cedarbaum said that she believes Martha Stewart has suffered and will continue to suffer enough. The judge also said that she had read through the more than 1,500 letters received by the court on Martha Stewart's behalf. And they certainly, apparently, did play a role in getting Martha Stewart that minimum sentence of five months in prison, five months of home confinement.
Now, Ms. Stewart's stockbroker, Peter Bacanovic, is scheduled to be sentenced within the next half hour. Mr. Bacanovic was convicted alongside Martha Stewart in the trial of lying to federal investigators about the true reason for Martha Stewart's sale of ImClone stock -- Carol.
LIN: All right. And he's likely to face similar sentencing -- it's the same sentencing guidelines for him, right?
CHERNOFF: Very similar. But in Mr. Bacanovic's case, he certainly cannot point to all the good deeds, all the contributions to society that, apparently, weighed in Martha Stewart's favor. So, we'll have to see exactly what happens with Peter Bacanovic, coming up shortly.
LIN: Got you. Got you. All right, thanks very much, Allan. We'll hear from you then.
In the meantime, we want to bring you a particular moment with Martha Stewart, because you didn't hear from her at the trial. Her attorneys did not call her up to testify. But she chose the moment today, after her sentencing, to speak out this morning and, in fact, twice. Did so inside and outside the courtroom.
Here's what she said to reporters in its entirety. Listen in.
(BEGIN VIDEO CLIP)
STEWART: Today is a shameful day. It's shameful for me, and for my family, and for my beloved company, and for all of its employees and partners. What was a small, personal matter became, over the last two years, an almost fatal circus event of unprecedented proportions. I have been choked and almost suffocated to death during that time, all the while more concerned about the well-being of others than for myself: more hurt for them and for their losses than for my own; more worried for their futures than the future of Martha Stewart the person.
More than 200 people have lost their jobs at my company as a result of this situation. I want them to know how very, very sorry I am for them and their families. I would like to thank everybody who stood by me, who wished me well, waved to me on the street -- like these lovely people over here -- smiled at me, called me, wrote to me. We received thousands of support letters and more than 170,000 e-mails to marthatalks.com, and I appreciate each and every one of those pieces of correspondence. I really feel good about it.
Perhaps all of you out there can continue to show your support by subscribing to our magazine, by buying our products, by encouraging our advertisers to come back in full force to our magazines. Our magazines are great. They deserve your support.
And whatever happened to me personally shouldn't have any effect whatsoever on the great company, Martha Stewart Living Omnimedia. And I don't want to use this as a sales pitch for my company, but we love that company. We've worked so hard on that company, and we really think it merits great attention from the American public.
And I'll be back. I will be back. Whatever I have to do in the next few months, I hope the months go by quickly. I'm used to all kinds of hard work, as you know, and I'm not afraid. I'm not afraid, whatsoever. I'm just very, very sorry that it's come to this -- that a small, personal matter has been able to be blown out of all proportion, and with such venom and such gore. I mean, it's just terrible.
(END VIDEO CLIP)
LIN: All right. That's what Martha Stewart had to say on the courthouse steps.
Her company, Martha Stewart Living Omnimedia, issued a statement, as well. Remember, Martha Stewart was talking about the 200 employees who had been laid off because of her legal troubles. In part, it says, "Martha Stewart Living Omnimedia is saddened for Martha. As always, she has our full support. Moreover, we are heartened that Judge Cedarbaum recognized Martha's strong public support and her lifetime of contributions to others -- past, present, and future -- that we in the company know so well."
"After 26 months of uncertainty, we see this as an important step toward closure for MSO. In the face of difficult events, our talented employees continue to develop, inspire original how-to information and products for the home. We thank them, our loyal customers and advertisers -- our stalwart distribution and manufacturing partners for sticking with us through these challenging times."
This is a company whose stock is going up today, but clearly concerned about the future.
NGUYEN: Stewart's lawyers insist a number of issues stacked the deck against them, but that doesn't guarantee a new deal from the Court of Appeals.
In fact, our Jeffrey Toobin is betting against it. Right, Jeff? Why is that?
JEFFREY TOOBIN, CNN CORRESPONDENT: Well, you have to remember, for starters, Betty, the vast, vast majority of criminal appeals are unsuccessful. Most people convicted and sentenced to prison stay convicted and stay sentenced to prison. So it's an uphill battle from the start.
Also, Judge Cedarbaum's a very respected judge. Martha Stewart had excellent lawyers at her trial. And Judge Cedarbaum ruled for Martha Stewart during this trial in several important ways. So, the idea that she, Martha Stewart, somehow got a raw deal in her trial -- which is what an appeal claims is going to be a long shot.
NGUYEN: But what about the perjury issues, Jeffrey -- the perjury issues? How did that play into the appeal?
TOOBIN: That is certainly the best argument that the -- both Martha Stewart and Peter Bacanovic will have. Very unusual situation here, where a government witness, a Secret Service agent, has been charged with perjury at her trial, and a -- one of the jurors apparently lied during his voir dire while he was being questioned in jury selection.
However, the perjury -- alleged perjury in the case of the Secret Service agent only related to a single document, which didn't really have anything to do with Martha Stewart. And the perjury -- alleged perjury regarding the juror is a very thin reed on which to argue that the whole case should be thrown out.
NGUYEN: Let's talk about this appeals process. How long do you expect it to date -- to take, and should Martha just go ahead and start serving her sentence right now? I mean, wouldn't it be easier?
TOOBIN: Well, that's a good question, because the length of the appeals process is very uncertain. And the one thing Martha Stewart appears to want, and certainly the stock market will want, is certainty. I don't see any way this case will even be argued on appeal until fall, and I think a decision is unlikely much before the first of the year.
So, I think Martha Stewart very likely will not go to prison, if her conviction is affirmed, until sometime during 2005, but certainly not before then. Should she go to prison early? You know, at one level, it seems like she should just get it over with. Five months isn't that long a time.
But in quite a few years of being in the criminal justice system and following the criminal justice system, I have never seen anyone volunteer to go to prison. People wait until the last minute, and Martha Stewart seems to be following in that trend.
NGUYEN: Yes, you can see why. Now, her attorney has already asked that if she goes to prison that they want her to be sent to Danbury, Connecticut, which is close to her home. But you say being female and dealing with a white-collar crime, she's at a disadvantage when it comes to prison.
TOOBIN: Yes, I don't think people really recognize that. There are so many more male white-collar criminals that there are, in fact, a lot of minimum-security prisons for men. There are so few women prisoners in general, and especially white-collar, there is no real separate prison for them. They are lumped in with more high security risk prisoners -- principally narcotics convicts. That's what most women in prison are.
And so, in Danbury, she will be in a higher security prison, less freedom, more restrictions on her comings and goings, you know, in and out of her cell, and she'll be surrounded mostly by people convicted of drug offenses.
NGUYEN: Jeffrey, quickly, we're almost out of time -- but Martha Stewart is already starting to do interviews. In fact, she's speaking with Larry King on Monday and even taking live viewer phone calls. Is that smart, at this point?
TOOBIN: You know, I think for Martha Stewart, at this point, it is all about getting her company back to life and helping her company, less so about the legal system. The appeals process will just go on its own. I actually think it is a smart process, because what the stock market and advertisers need to be assured is that this company will survive. And the only way to do that is to have Martha Stewart out front and center.
It doesn't mean it will survive and thrive, but Martha Stewart being out and in public is the only way it has any chance, I think.
NGUYEN: CNN's Jeffrey Toobin, thank you -- Carol.
LIN: All right. We don't want to forget that we want to hear from you. E-mail your comments to us about Martha Stewart's sentencing, whether it was fair or any other thoughts you have. Our e-mail address is livefrom@cnn.com, and we're going to read them near the end of this hour.
And don't forget, we're still staying tuned for Peter Bacanovic's sentencing. He is Martha Stewart's broker. He faces four similar counts as to Martha Stewart. We saw him as he entered the courthouse earlier today. He's, once again, facing charges on the same offenses of lying and obstructing justice. We're going to bring you the sentence as soon as we get it.
NGUYEN: Thousands of acres charred, hundreds of people forced from their homes by flames. Firefighters in Carson City, Nevada, hope to make headway today on a huge wildfire burning on the north side of town. It's a battle fought in the air and on the ground.
CNN's Ted Rowlands is near the eye of the firestorm and joins us with a look. Hi, Ted.
(BEGIN VIDEOTAPE)
TED ROWLANDS, CNN CORRESPONDENT: As expected, the fire here at Carson City started to move away from threatened homes in -- by midmorning, over a ridge towards the Lake Tahoe area. Firefighters are using an aerial assault to try to stop the movement of this fire. Overnight, they were able to save about 50 homes in a development area that was threatened.
The hope was that the flames would lie down overnight, but they didn't. Firefighters had to actively fight the flames that were shooting as high as 100 feet, consuming more fuel. They were able to save those homes. Fourteen homes, however, have been completely destroyed by this fire, which started on Wednesday.
And although the wind has shifted now, it is expected that the wind will shift again. And those same homes will again be threatened.
KURT FROSDICK, FIRE INTERAGENCY SPOKESMAN: This afternoon, as the winds pickup and go to the southwest, it's going to go back towards those homes again. We're also protecting those homes, setting up strike teams, and clearing out that brush as well.
ROWLANDS: It is expected that firefighters will use an air assault for the rest of the daylight hours here, then overnight. It will be an all night effort as well as they try to keep these homes safe. Up till now, 9,100 acres have been burned in this fire.
Ted Rowlands, CNN, Carson City, Nevada.
(END VIDEOTAPE)
NGUYEN: No doubt they could use some help from Mother Nature. We want to turn now to Meteorologist Orelon Sidney for the latest on the weather. Hi, Orelon.
ORELON SIDNEY, CNN METEOROLOGIST: Betty, thanks a lot. This weekend is going to be kind of a mixed bag. Some things will help and some things will hurt the fire efforts.
Here's your forecast for Carson City, Nevada. I wanted to show you, your temperatures will be close to 90 degrees. The warmer the temperature, the harder it is to fight the fire. Hot temperatures help the fire to spread, make it more difficult.
And then, look at the relative humidities. They actually drop through the weekend. Look, when it gets to 11%, does it really matter if you take a few more percent off? Things are going to be very dry, very hot, but the good news is there's not going to be a lot of wind. Wind can be a big problem, especially when it's over 15 miles an hour in a fire situation.
For today, the peak winds, about 10 miles an hour, five miles an hour on Saturday, and then Sunday, going up to 15 miles an hour. The big problem, of course, is when you have winds that are variable. and that's what we will see this weekend -- not just looking at winds steadily from one direction, but coming from several directions. That makes it difficult to find out where the embers from the fires will land. And of course, then you have homes threatened in many different directions.
It's going to be a very hard fire to fight. It's going to be a very rough weekend out in the west. Betty, Carol?
NGUYEN: Definitely. Thank you, Orelon.
SIDNEY: You're welcome.
NGUYEN: Carol?
LIN: All right. Thanks much.
An accused sniper found mentally fit to stand trial. That story tops our look at news across America.
A psychiatrist says Charles McCoy, Jr. is competent to stand trial on charges that he was firing at cars for a period of time in Ohio. He is also accused of killing a 62-year-old woman.
Now, this is a 28-year-old man who suffers from paranoid schizophrenia. He has pleaded not guilty right now to 24 counts. His trial is set for January.
Top secret work comes to a grinding halt. The extraordinary stand down at Los Alamos National Laboratory follows the disappearance of two classified storage devices last week. A complete inventory of sensitive material is expected to be completed within days. So, they still don't really know exactly what's missing.
Mourning "Bobo" -- dozens of people gathered in Florida last night for this candlelight vigil honoring an escaped tiger that was shot and killed earlier this week. The officer who shot the tiger says he acted in self-defense.
NGUYEN: Now, here's an interesting question for you: Will Medicare start paying for liposuction? How Medicare's decision to treat obesity as a disease could affect healthcare insurance for all Americans. That's ahead on LIVE FROM...
And show of support: Senator John McCain joins the vice president in a battleground state.
Plus: When battlegrounds become playgrounds -- the life and death game for the children in the Middle East.
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NGUYEN: Arizona Senator John McCain is hitting the campaign trail in support of the Republican presidential ticket. He and Vice President Cheney are in Michigan at this hour, attending a rally in Lansing. Their visit comes just three days after President Bush made a campaign stop in Marquette, Michigan. From there, Cheney moves on to Waterloo, Iowa.
Well, John Kerry is making a promise to America's teachers. He says, if elected, he'll put as much money behind the nation's education reforms as allowed by law. The Democratic presidential hopeful speaks next hour to the American Federation of Teachers National Convention, which is taking place in Virginia. This evening, he'll attend a rally in Arlington, Virginia.
LIN: And John Kerry's running mate is pressing on with his solo campaign efforts, arriving in Los Angeles about an hour ago. Our Kelly Wallace spoke to the VP hopeful earlier about what he's doing on the road to help John Kerry become president.
(BEGIN VIDEO CLIP)
SEN. JOHN EDWARDS (D-NC), VICE PRESIDENTIAL CANDIDATE: I can talk about things that he can't naturally talk about. I mean, he can say that he served in Vietnam, but he can't talk in the sort of passionate way I can about what it means about his values and his beliefs that the men who served with him adore him and respect him and look up to him, even now, 30 years later.
(END VIDEO CLIP)
LIN: And John Edwards is going to be talking to a group of Latino voters at a banquet tonight.
A liberal advocacy group will have its anti-war billboard up in New York Times Square in time for the Republican convention. Clear Channel Communications initially rejected the billboard, which shows a bomb image and the text, "Democracy is best taught by example, not war."
So, Project Billboard is replacing the bomb image with a peace dove. The group had accused Clear Channel of rejecting the image for political reasons, but the media company says it thought the bomb was insensitive in a city hit so hard by terrorism.
NGUYEN: Broker busted, now he's going to be sentenced. Martha Stewart's ex-broker, Peter Bacanovic, finds out his fate in just a few minutes. We'll bring that to you as soon as we get word.
RHONDA SCHAFFLER, CNN FINANCIAL CORRESPONDENT: I'm Rhonda Schaffler, LIVE FROM... the floor of the New York Stock Exchange, where shares of Martha Stewart's company are soaring. Details from LIVE FROM... continues after the break.
(COMMERCIAL BREAK)
LIN: All right, you're looking at the courthouse steps at the federal courthouse in New York, where we are expecting Martha Stewart's stockbroker, Peter Bacanovic, to be sentenced at any moment. He is facing four counts of obstruction of justice and lying during the investigation of the ImClone stock sale. We're going to bring that to you shortly.
NGUYEN: In the meantime, one big man may be gone from the Lakers' lineup, but star player Kobe Bryant will be back. He has signed a new seven-year contract worth more than $136 million. Bryant briefly flirted with another team -- several other teams, becoming a free agent after the Lakers lost to Detroit in the NBA finals.
Coach Phil Jackson was let go shortly after that, and star center Shaquille O'Neal demanded a trade. He'll play for the Miami Heat starting next season.
LIN: And basketball fan, and controversial director, Spike Lee is staying firmly by the side of his friend Bill Cosby, who's rocked the boat, saying African-Americans aren't ambitious and need to stop blaming the white man for their problems.
I sat down with Spike Lee, who told me that African-Americans cannot ignore what is at stake.
(BEGIN VIDEO CLIP)
SPIKE LEE, FILM DIRECTOR: It's serious now. I mean, we've got to take off the kid gloves, because you have to realize we're at a point where it's not just a matter that a large segment of African- American kids can't read or write. It's the fact they don't want to learn to read or write, because somehow, they've been told that education is acting white.
(END VIDEO CLIP)
LIN: Spike talked about a lot of things. So, please, tune in to my prime time show Sunday night at 10 p.m. where you're going to see what else Spike had to say about morality, lesbians, Democrats, Republicans and, most important -- to him at least -- his kids.
NGUYEN: He runs the whole gamut. Very interesting, looking forward to that.
Well, Martha Stewart will be heading to prison if her appeal fails. But investors in her company are breathing a big sigh of relief...
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