Martin Armstrong has always had a talent for the exceptional. As a self-made economics forecaster and markets guru, he once claimed to have the ear of presidents and prime ministers. Then, in 1999, the high-profile collapse of his New Jersey-based Princeton Economics International investment company left its US founder facing federal charges of defrauding Japanese investors of more than $700m.

Mr Armstrong's criminal trial is due to start in March next year. Although he was initially released on $5m bail to await trial, the author of The Greatest Bull Market in History has spent more than four and a half years incarcerated in Manhattan for contempt of court, in an exceptional legal battle over the whereabouts of a collection of gold bars, gold bullion coins and a statue of Julius Caesar.

"He is the civil contemner incarcerated for the longest period of time in a civil case involving financial fraud," says Mr Armstrong's lawyer, Thomas Sjoblom of Chadbourne & Parke.

Mr Sjoblom argues that the case raises fundamental questions about the powers of US courts to place the chief executives in jail - potentially indefinitely - on a contempt charge.

Mr Armstrong was jailed early in 2000 after he failed to produce the collection of valuables, worth $14.9m, in response to demands from the SEC, the US financial regulator, and the Commodities Futures Trading Commission. Mr Armstrong was also facing a parallel criminal indictment over the alleged fraud.

Imprisonment for contempt after refusing to obey a civil court's "turnover order" for assets is common in US civil law cases. Under US practice, incarceration continues as long as it is judged to be coercive and likely to achieve compliance with the court's order rather than punitive.

"It is a standard that is obviously quite subjective, and the court has a lot of leeway," says Robert Morvillo, a specialist in financial cases who defended Martha Stewart. "But after four and a half years, it seems to me that the person has pretty much demonstrated that he's not going to comply," and should be released.

Previously, the longest period of civil incarceration in a financial fraud case, according to cases cited in Mr Armstrong's hearings, was 22 months.

After three failed appeals seeking the lifting of the contempt charge, Chadbourne & Parke has now launched another bid to secure Mr Armstrong's release, filing a writ of habeas corpus.

The writ argues that Mr Armstrong is being held in violation of a 1970 law passed by Congress on witness testimony that set an 18-month limit on civil contempt, although the courts have been divided over its interpretation in cases involving asset turnover orders.

Mr Armstrong's lawyers are also arguing more broadly that the affair has wider implications for white collar fraud cases. They claim that the government is using "the civil contempt as a weapon with which to improperly manipulate the civil proceedings to prejudice Mr Armstrong's rights and to obtain unfair tactical advantage" in the parallel criminal prosecution.

"This has been a problem for at least 20 years, this whole issue of the double-barrel approach," says Mr Sjoblom.

"How do you walk through the rules of civil procedure and criminal procedure? It is a very narrow tightrope to walk." Other securities la w defendants do, however, frequently manage to walk the line, without Mr Armstrong's complications.

Mr Armstrong's case is "exceptional", says Thomas Dewey, of Dewey, Pegno and Kramarsky, the US law firm. "Most defendants, in general, will try and resolve the civil case through a negotiated settlement."

The US attorney's office, meanwhile, is continuing to prepare its criminal case against Mr Armstrong. Characteristically, he is considering representing himself, citing a conflict with his court-appointed criminal defence team.