Martha Stewart Omnimedia stock fell 15% Tuesday on word that the U.S.
Attorney's office in New York would soon indict Stewart on charges related to the
ImClone Systems Inc. insider-stock-trading scandal that has embroiled Stewart and her
company for the past year.
The company issued a statement Tuesday morning indicating that Stewart's
lawyers had informed it of the intentions of the U.S. Attorney's office.
There was no word on the exact timing of the planned indictment, however.
Stewart's lawyers had been negotiating with the Attorney's office for a deal
that would result in lesser charges, but the talks apparently fell through.
At noon, the stock was down $1.82 to $9.38 per share. It closed Tuesday at $9.52 apiece, down $1.68, or 15 percent.
Stewart is chairman and CEO of the company and controls about 61% of its
According to her employment agreement, if she's convicted or pleads guilty in
a plea bargain deal, the company could oust her if it determines that her conduct has
damaged its business or reputation.