January 27, 2003 10:00 AM

Martha Stewart is finally speaking out after seven months of silence about the investigation into her sale of ImClone stock — telling the New Yorker magazine that she finds the public reaction to her woes “puzzling and also confusing.”

The domestic diva, 61, would not speak on the record about the sale of 4,000 ImClone shares on Dec. 27, 2001, nor about being investigated for possible insider trading and obstruction of justice. The topics she did touch upon, however, included the damage all this has done to her business and to her fortune.

“That I have been turned into or vilified openly as something other than what I am has been confusing,” she tells New Yorker writer Jeffrey Toobin in an exclusive interview.

In his article, the magazine’s legal writer notes that the interview was granted after associates of Stewart, “frustrated by the bad publicity, saw that there might be advantages for their client in such an interview.”

Toobin met with Stewart at her house in Westport, Conn., on Jan. 19, a spokeswoman for the magazine tells The New York Times. Toobin writes in the piece that the unnamed Stewart associates “were present for our conversation.”

Among Stewart’s claims: “I’ve never not been nice to anybody.” She also dismisses the suggestion that she might vacate her CEO perch at Martha Stewart Living Omnimedia, as some experts said could occur in light of her SEC investigation.

“Quit a business that is my life?” she says. “Impossible.”

Stewart says the investigation has cost her about $400 million — because of the shrunken value of her shares in her own company, legal fees and lost business.

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