Myths About Martha

A mythology has clouded the trial of Martha Stewart since it kicked off last week in Lower Manhattan. The spreading belief that the case is flimsy has helped boost Martha Stewart Living Omnimedia (MSO ) stock some 30% this year. Investors should approach the situation with more skepticism.

Whereas most celebrities on trial -- and this is a celebrity trial more akin to the Winona Ryder five-finger-discount courtroom-reality show in Beverly Hills than the trials of arch-villain CEOs gone wild of the Bernie Ebbers ilk --are presumed guilty in the court of public opinion, Martha seems to be getting more than just the benefit of the doubt.

Of more concern than the presumption of innocent until proven guilty -- which is a good thing -- is the misconceptions and folklore surrounding the case. This is particularly troubling for those who have recently purchased MSO stock in anticipation of business-as-usual at the company.

Here then is the definitive guide to the biggest myths about the princess of perfections problems:

1. It's just 3,928 shares -- for Martha that's nothing, what's the big deal?

Since when does the amount allegedly swindled have any bearing on the gravity of the charges? By this logic, if Bill Gates held up a convenience store at gunpoint he should go free because "what's $300 to a billionaire anyway?"

Doesn't the fact that she would consider bending or breaking the rules (if she's guilty) over so little say something about her character?

Does a crime's relative insignificance to bigger recent crimes matter? If you robbed a small-town bank of $20,000 and somebody else knocked over a Brinks truck for $20 million, should the government leave you alone and focus on the bigger fish?

Besides, the fact that the Ken Lays of the world are walking the streets does not mean they have been written off as untouchable by the government just yet.