Paper Chase in Martha Trial

Stewart's defense attorneys, who originally introduced the articles, also superseded Cedarbaum's instructions by using the same articles and press releases to their advantage.

In the case of the price spike in MSO shares on June 19, 2002, Stewart's lawyers introduced an MSO press release from June 19, 2002, which announced that the company would be increasing earnings guidance at a Piper Jaffray media conference. The defense contended, therefore, that the company's performance, not Stewart's statement of innocence, was the factor behind the jump in price.

Stewart's defense team, led by Robert Morvillo, originally introduced the series of June 2002 articles to demonstrate how the media were unfairly accusing their client of insider trading.

As one of many examples, the defense introduced a June 12, 2002, transcript from a Fox news program with Neil Cavuto in which Rep. Jim Greenwood, (R., Pa.), said "I believe that these trades were made on inside information and that's illegal."

The defense portrayed Stewart's claim of innocence in a June 12, 2002, press release as an attempt to answer such charges they viewed as untrue.

Stewart spokeswoman Susan Magrino said on June 12, 2002: "Ms. Stewart did not receive any non public inside information prior to her sale of a small number of ImClone shares. Her transaction was entirely lawful."

The numerous articles being read to the jury led Richard Strassberg, the lawyer for Stewart's former broker and co-defendant Peter Bacanovic, to ask Cedarbaum for a mistrial. Cedarbaum quickly denied Strassberg's request, saying she remained confident that the jury would focus only on the true intent of the articles.

Government attorneys also spent part of the morning session pursuing the securities fraud charges by questioning Gregory Blatt, the former general counsel of Martha Stewart Living, who now holds the same post at InterActiveCorp(IACI Quote) .