Attorneys for lifestyle entrepreneur Martha Stewart gave Congress 1,000 pages of documents Tuesday, at least temporarily averting a subpoena.
The House Energy and Commerce Committee, investigating possible illegal inside trading by Stewart in stock of biotech company ImClone, asked for detailed phone records and e-mail messages and for relevant correspondence from her business manager, Heidi DeLuca.
Committee spokesman Ken Johnson says investigators immediately began searching the documents and were trying to determine Tuesday night if the panel got everything it requested. Financial information that Stewart’s lawyers said was unrelated to ImClone was blacked out in the documents, and the committee already has asked to see the originals this week.
Johnson says it will likely take investigators several weeks to draw any conclusions. At that point, committee Chairman W.J. ”Billy” Tauzin, R-La., plans to decide whether to subpoena Stewart to appear before the committee or its investigators.
Stewart sold $224,000 of ImClone shares on Dec. 27, the day before the Food and Drug Administration rejected the company’s application to sell the cancer drug Erbitux. She says the decision was related to a pre-existing order for her broker, Peter Bacanovic, to sell if the stock dropped below $60 a share.
The committee has been unable to find any evidence of such an agreement and has conflicting information about whether she was in touch with Bacanovic that day.
Bacanovic’s assistant, Douglas Fanueil, has reportedly told prosecutors that Bacanovic asked him to tell Stewart to sell because family members of ImClone founder Samuel Waksal were unloading their shares.
Johnson says the task of sorting out who called whom will be made more difficult because phone records for Stewart’s company, Martha Stewart Living, are not sorted by employee. The committee is looking for evidence of communication by e-mail or phone between Stewart and Bacanovic, among other information supporting or raising questions about her account.