A federal judge approved a class-action settlement that requires Martha Stewart Living Omnimedia and its founder to pay shareholders $30 million in compensation for losses suffered during the ImClone scandal, lawyers said on Wednesday.
Homemaking expert Martha Stewart was convicted by a Manhattan federal court jury in March 2004 of lying to investigators probing her sale of shares of ImClone Systems Inc. She served five months in prison and five more months of house arrest.
The shareholders accused the media and merchandising company's executives of misleading investors by making false statements related to the government probe into Stewart's suspicious stock trading. The lawsuit contended stockholders lost money because of the scandal.
The pact requires that the homemaking expert pay $5 million of the total settlement, according to law firm Milberg Weiss & Bershad LLP, which represented the investors.
The settlement had been reached between the parties earlier, but received approval from U.S. District Judge John Sprizzo in Manhattan Tuesday, according to Milberg Weiss.
Omnimedia did not immediately respond to a request for comment on Wednesday.