Robert "Joe" Halderman, a veteran producer for the CBS crime show "48 Hours," was released on $200,000 bail Friday after he pleaded not guilty to charges of trying to blackmail Letterman for $2 million. If convicted, Halderman could face between five to 15 years in a state prison.
Meanwhile, 62-year-old Letterman, who attempted to explain the plot and sex scandal to his audience last week, became the punchline of late night jokes himself.
On NBC's "Saturday Night Live," the anchor of the show's "Weekend Update" segment joked that the man who was arrested for blackmailing Letterman was doing a "stupid human trick."
Giving an example of the personal details of Letterman's life the alleged extortionist was threatening to disclose, anchor Seth Meyers added: "After sex, he would always say, 'Stay tuned for Craig Ferguson.'"
Former competitor Jay Leno opened his own prime-time show on NBC Friday with the line: "If you came here tonight for sex with a talk show host, you've got the wrong studio."
On NBC's "Late Night," Jimmy Fallon quipped, "There's a new book out called 'Why Women Have Sex' that says there are 237 reasons why women have sex. And folks, Letterman knows the Top 10."
Letterman's guest on Friday, actor/producer Larry David of HBO's "Curb Your Enthusiasm," also took a jab at the host.
Joking that he has probably broken the record for the least amount of sex for someone with their own TV show, David asked Letterman if he could speak to that.
"Oh, I don't know," Letterman replied, sheepishly.
Acknowledging the unspecified sexual relationships with female staff members to a silent audience, Letterman said, "My response to that [allegation] is, 'Yes I have.' Would it be embarrassing if it were made public? Perhaps it would. Especially for the women."
The scandal hasn't yet dented the late night host's popularity. Ratings of "The Late Show" jumped 38 percent on Thursday compared to the same night a week ago as allegations about an extortion plot and Letterman addressing the case during his show surfaced earlier in the day. Several major advertisers have already announced they are sticking with the show, saying they are more interested in the improved ratings than Letterman's personal life.
Letterman took the top spot in late night ratings after rival Leno retired from his hosting gig at "The Tonight Show" and Conan O'Brien took over.
Joe Halderman Upset by Divorce Proceedings
CBS producer Halderman, 51, appeared before a Manhattan court Friday after he was arrested Thursday outside CBS' Manhattan offices and arraigned on charges of attempted grand larceny.
According to the New York District Attorney, Halderman waited outside Letterman's Manhattan home at 6 a.m. Sept. 9 to deliver a letter and other documents to him as he was leaving for work.
The district attorney's office said in a press release that Halderman wrote he needed to "make a large chunk of money" by selling Letterman a so-called "screenplay treatment."
The document then related that Letterman's "world is about to collapse around him" as information about his private life is disclosed, leading to a "ruined reputation" and severe damage to his professional and family lives. The package contained other materials supporting the "screenplay treatment" and directed Letterman to call him by 8 a.m. to make a deal.
Letterman immediately called his attorney, who arranged a meeting with Halderman and contacted the district attorney's office.
In subsequent meetings, the district attorney's office said in a press release: "Halderman repeated his demand for $2 million to prevent him from going forward with his threat to publicly disclose the personal and private information described in his initial delivery to Mr. Letterman."
Letterman's attorney recorded his meetings with Halderman, and Judge Michael Melkonian said Friday the tapes showed "clear, actual and explicit" threats against the TV personality.
Halderman was given a phony $2 million check that was "designed to bounce" and the producer was arrested Friday after depositing the check in Connecticut Oct. 1.
On Friday, the Emmy Award-winning producer posted bail, but Judge Melkonian also issued a temporary order of protection to keep him away from Letterman. Halderman also has to check in with his bail bondsman once a week in person, but is allowed to travel to his Connecticut home.
CBS News released a statement saying Halderman has been suspended from his job as the investigation continues.
Halderman's lawyer, defense attorney Gerald Shargel, said that he plans on going to trial with his client.
"There is another side to this story," Shargel told reporters Friday. "If I listened to what prosecutors said, I would be out of business a long time ago."
Shargel defended Halderman saying, "He has an impeccable reputation [...] He's never been in trouble with the law."
Assistant District Attorney Judy Salwen, deputy chief of the Special Prosecutions Bureau, had originally requested that bail be set at $500,000, saying, "There is a serious question as to whether [Halderman] will return to court if lower bail is set."
Salwen said that tape recordings of two meetings between Halderman and Letterman's attorney showed "clear, actual and explicit" threats against the comedian.
It remains unclear how Halderman obtained the information he used to blackmail Letterman, but public documents show he lived with one of the late night talk show's longtime assistants, Stephanie Birkit, until last August.
The 34-year-old, who could not be reached for comment, made frequent appearances on Letterman's show over the years.
Halderman himself is twice divorced; he has two children with his second wife and three stepchildren.
According to divorce papers, as of May 2004, Halderman was required to pay $6,800 a month in child support and alimony. He tried to decrease his child support payments to $2,039 in 2007, despite the fact that his yearly earnings had increased from $189,000 to $214,000. He was also receiving $1,500 a month in rent from Birkitt, with whom he shared his house.
When Halderman's ex-wife won custody of the children, she took them to Colorado.
In an interview with CNN, Halderman's his uncle said his nephew was very upset by the move.
"But I never heard any hostility from him other than it hurt. We had no reason to believe he would be depressed enough to get in this kind of a situation," Richard Smith said.
Sex and Blackmail Cast Shadow on Letterman
As the investigation into the extortion case continues, Letterman is likely to remain in the spotlight.
It's unknown how many staffers Letterman was involved with, but reports say the liaisons took place before he was married and before the birth of his son, Harry Joseph Letterman, in 2003.
"I feel like I need to protect these people. I need to certainly protect my family," Letterman said when making the awkward announcement of his affair.
Earlier this year, Letterman married his longtime girlfriend, Regina Lasko, a former member of his staff, who he began dating in the 1980s. They wed March 19, 2009, at the Teton County Courthouse in Choteau, Mont.
After announcing his wedding during his show March 23, 2009, he said, "I had avoided getting married pretty good for, like, 23 years and I ... secretly felt that men who were married admired me, like I was the last of the real gunslingers."
Letterman remained unmarried for a long time after his first marriage to college sweetheart Michelle Cook ended in divorce in 1977. He dated another staffer Merrill Markoe, a comedian and author who was his longtime writer when he was on NBC, in the 1980s.
This is not the first extortion plot alleged to have targeted Letterman. In 2005, Kelly Frank, who worked as a handyman on Letterman's Rocky Mountain ranch in Montana, was arrested for allegedly plotting to kidnap Letterman's then-16-month-old son, Harry. Kelly allegedly wanted $5 million for the return of Harry and his au pair. Frank first pleaded not guilty but later copped a deal of felony theft and other lesser charges and got 10 years in jail in 2005.
ABC News' Michael James, Lindsey Goldwert, Kate McCarthy and Richard Esposito contributed to this report.