By: History.com Editors

2005

Martha Stewart is released from prison

History.com Editors

Published: November 13, 2009

Last Updated: January 24, 2025

On March 4, 2005, billionaire mogul Martha Stewart is released from a federal prison near Alderson, West Virginia, after serving five months for lying about her sale of ImClone stock in 2001. After her televised exit from the facility, Stewart flew on a chartered jet from nearby Greenbrier International Airport to New York, where she would serve out her remaining five-month home confinement on her 153-acre Bedford, New York, estate.

On December 21, 2001, Stewart sold about 4,000 shares of ImClone Systems, a company run by her friend Sam Waksal that develops cancer-therapy drugs. The next day, the company's stock tanked after news broke that ImClone s newest cancer drug, Erbitux, had been rejected by the FDA. Waksal, who also sold stock before the drug's rejection was made public, was arrested on charges of insider trading and later sentenced to more than seven years in prison. When questioned about her sale of the stock in June 2002, Stewart denied any insider knowledge and said that the stock was sold based on a previously made agreement with her stock broker, Peter Bacanovic of Merrill Lynch.

The next month, Bacanovic was suspended by Merrill Lynch when investigators were unable to confirm that such an agreement actually existed. In September 2002, the Department of Justice began to investigate Stewart's stock sale and alleged insider trading. Less than a year later, she was indicted on charges of securities fraud and obstruction of justice and subsequently resigned as chairman and CEO of the company she founded, Martha Stewart Living Omnimedia, though she remained on the company's board. Stewart's trial began in February 2003.

Days into the trial, Bacanovic's former assistant, Douglas Faneuil, testified that he had been ordered by Bacanovic to inform Stewart that she should sell her ImClone stock. Soon after, a friend of Stewart s testified that Stewart told her she knew Sam Waksal had been trying to sell the stock before dumping her own shares. Though the judge dropped the securities fraud charge against Stewart in February for lack of evidence, she was convicted on all remaining counts of conspiracy, obstruction of justice, and making false statements on March 5, 2004. Public opinion polls at the time showed that many Americans believed Stewart should serve prison time; others thought Stewart had been unfairly targeted by overaggressive prosecutors.

On July 16, 2004, Stewart was sentenced to five months in prison and five months of home confinement, in addition to being fined $30,000 and given two years probation. She could have received up to 16 years in prison. Stewart requested to serve her time immediately and was sent to the minimum-security facility in West Virginia on October 8, 2004.

Despite fears that Stewart's legal battle might devastate her financial empire, Martha Stewart Living Omnimedia's stock price climbed dramatically during her incarceration, with values quadrupling by the time of her March 2005 release. During her subsequent home confinement, Stewart was forced to wear an electronic ankle bracelet to monitor her movement and was able to leave home for only 48 hours each week and only to go to work. Immediately upon completion of her sentence, she began work on two new NBC television shows: a primetime spin-off of the reality series The Apprentice and a daytime variety show, Martha.

Timeline

Also on This Day in History

Discover more of the major events, famous births, notable deaths and everything else history-making that happened on March 4th

1776

American forces occupy Dorchester Heights

Under the cover of constant bombing from British artillery, Brigadier General John Thomas slips 2,000 troops, cannons and artillery into position at Dorchester Heights, just south of Boston, on March 4, 1776. Under orders from General George Washington, Thomas and his troops worked through the night digging trenches, positioning cannons and completing their occupation of Dorchester Heights.

1789

Government under the U.S. Constitution begins

The first session of the U.S. Congress is held in New York City as the U.S. Constitution takes effect. However, of the 22 senators and 59 representatives called to represent the 11 states who had ratified the document, only nine senators and 13 representatives showed up to begin negotiations for its amendment.

1829

Andrew Jackson holds “open house” at the White House

On March 4, 1829, Andrew Jackson upholds an inaugural tradition begun by Thomas Jefferson and hosts an open house at the White House.

1861

Abraham Lincoln inaugurated

Abraham Lincoln becomes the 16th president of the United States on March 4, 1861. In his inauguration speech, Lincoln extended an olive branch to the South, but also made it clear that he intended to enforce federal laws in the states that seceded.

1918

First cases reported in deadly 1918 flu pandemic

Just before breakfast on the morning of March 4, Private Albert Gitchell of the U.S. Army reports to the hospital at Fort Riley, Kansas, complaining of the cold-like symptoms of sore throat, fever and headache. Soon after, over 100 of his fellow soldiers had reported similar symptoms, marking what are believed to be the first cases in the historic influenza pandemic of 1918, later known as Spanish flu. The flu would eventually kill 675,000 Americans and an estimated 20 million to 50 million people around the world, proving to be a far deadlier force than even the First World War.

1933

FDR inaugurated

On March 4, 1933, at the height of the Great Depression, Franklin Delano Roosevelt is inaugurated as the 32nd president of the United States. In his famous inaugural address, delivered outside the east wing of the U.S. Capitol, Roosevelt outlined his “New Deal”—an expansion of the federal government as an instrument of employment opportunity and welfare—and told Americans that “the only thing we have to fear is fear itself.”

Inauguration of Franklin D. Roosevelt

1944

Louis “Lepke” Buchalter, the head of Murder, Inc., is executed

Louis “Lepke” Buchalter, the head of Murder, Inc., is executed at Sing Sing Prison in New York. Lepke was the leader of the country’s largest crime syndicate throughout the 1930s and was making nearly $50 million a year from his various enterprises. His downfall came when several members of his notorious killing squad turned into witnesses for the government.

1952

Ronald Reagan and Nancy Davis marry

On March 4, 1952, actor and future President Ronald Reagan marries his second wife, actress Nancy Davis. The couple wed in Los Angeles at the Little Brown Church in the Valley.

1952

Ernest Hemingway finishes “The Old Man and the Sea”

Ernest Hemingway completes his short novel The Old Man and the Sea. He wrote his publisher the same day, saying he had finished the book and that it was the best writing he had ever done. The critics agreed: The book won the Pulitzer Prize in 1953 and became one of his bestselling works.

1960

Lucille Ball files for divorce from Desi Arnaz

After 20 tumultuous years of marriage, actress Lucille Ball files for divorce from her husband and collaborator, Desi Arnaz, on March 4, 1960. The breakup of the couple, stars of the hit sitcom "I Love Lucy" and owners of the innovative Desilu Studios, was one of the highest-profile divorces in American history at the time.

1966

John Lennon sparks his first major controversy

On March 4, 1966, an offhand John Lennon comment appears in the London Evening Standard. Months later, it erupted in the “Bigger than Jesus” scandal that brought a semi-official end to the giddy phenomenon known as Beatlemania.

1974

“People” magazine launches

On March 4, 1974, actress Mia Farrow from The Great Gatsby graces the cover of the inaugural issue of People, a weekly celebrity and human interest magazine spotlighting the personal lives of notable and intriguing people. People remains one of America’s best-selling weeklies.

1990

College basketball star Hank Gathers collapses on court, dies

On March 4, 1990, Loyola Marymount University star senior forward Hank Gathers sprints down the court during a West Coast Conference tournament game, leaps and catches an alley-oop pass, slams down an emphatic dunk, and, after jogging back to midcourt, collapses to the floor. Although he briefly regains consciousness, he is rushed to a hospital, where he dies. "This is the hardest thing I’ve ever experienced,” Loyola Marymount coach Paul Westhead tells the media.

1994

John Candy dies

The comedic star John Candy dies suddenly of a heart attack on March 4, 1994, at the age of 43. At the time of his death, he was living near Durango, Mexico, while filming Wagons East, a Western comedy co-starring the comedian Richard Lewis.

2004

Mianne Bagger becomes first transgender athlete to play in pro golf tournament

On March 4, 2004, Mianne Bagger, a golfer from Denmark, makes history at the Women’s Australian Open as the first transgender athlete to compete in a professional golf tournament. Bagger shoots an underwhelming 84 (12 over par) in her first round, but that is a footnote to the historic performance.

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Citation Information

Article title
Martha Stewart is released from prison
Website Name
History
Date Accessed
March 22, 2025
Publisher
A&E Television Networks
Last Updated
January 24, 2025
Original Published Date
November 13, 2009

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