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In the House; Update on Michael Jackson Trial; Teacher Gets Reprieve

Aired March 4, 2005 - 14:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

KYRA PHILLIPS, CNN ANCHOR: She's walked her dog, fed her horses, fed the media, contemplated cappuccino for the first day out of prison for Martha Stewart. What's on the to-do list for the next few months?
MIGUEL MARQUEZ, CNN CORRESPONDENT: And I'm Miguel Marquez, live in Santa Maria, California. The cross-examination of the sister of Michael Jackson's accuser has begun. I'll let you know how she's doing on the stand.

TONY HARRIS, CNN ANCHOR: A threatened deportation, student protests and now a reprieve for a beloved Boston teacher who was going to be kicked out of the country.

PHILLIPS: Has hip-hop gone too far? A campus crusade to clean up the image of black women in music videos.

From the CNN Center in Atlanta, I'm Kyra Phillips.

HARRIS: And I'm Tony Harris, in for Miles O'Brien. This hour of CNN's LIVE FROM starts right now.

Up first this hour -- this is for Kyra -- Martha Stewart in the hizzel! This is she on the West Virginia tarmac in the wee hours of this morning. A federal prison inmate no longer.

Now a prisoner in her own home. Make that one of her own homes -- a 150-acre estate in New York's Westchester County.

It's not exactly freedom, Allan Chernoff, but it is a far cry from incarceration even at Camp Cupcake, right?

ALLAN CHERNOFF, CNN SR. CORRESPONDENT: No question about that, Tony.

Martha Stewart arrived here at 2:30 last night. Her entourage drove in through the front gate. But she woke up early and, in fact, was out to reacquaint herself with many of her pets.

Her horses, she was out petting them quite early in the morning. She was also walking the dog and chatting up the photographers who were at the -- at the gate to the home.

She also talked about how in prison they had asked for cappuccino from the guards every day. And now that she had finally arrived at home, her cappuccino machine was broken. Later on, though, she was kind enough to bring out some hot cocoa for all of the photographers standing by. They certainly were very appreciative, enjoyed that very much. She also showed off some lemons to a photographer and said she enjoyed very much having hot lemonade and she planned to do so this afternoon.

Now, things will get more serious for Martha Stewart later on the weekend. She is going to be meeting with her probation officer, and she'll have an ankle bracelet attached. That will monitor her goings, and she will be restricted to the home, only allowed out 48 hours a week to visit a doctor perhaps, to go shopping for groceries, and also to work. And Martha Stewart has plenty of work planned.

She will be writing her column for her magazine, "Martha Stewart Living." She also has two television shows that will be in production, that will be in production, a version of "The Apprentice" and also a new syndicated lifestyle program -- Tony.

HARRIS: Allan, when does she get to -- I guess her titles back. When does she get to actually physically run her company? That is a while down the road, isn't it?

CHERNOFF: If ever, Tony. She remains the largest shareholder in the company. She is still, of course, the founder. And she will have a tremendous amount of input.

But in terms of being an actual officer or director at the company, she had to give up all of the titles, chairman, CEO, director. And the Securities and Exchange Commission still has a civil insider trading case pending against Martha Stewart. They're asking that she be banned for life from serving as an officer.

According to Martha Stewart's attorney, he is trying to settle the case. And another source close to this situation tells us a settlement is likely in the case. And it probably would involve Martha Stewart being banned from being an officer for five years.

HARRIS: OK. Allan, we appreciate it. Don't drink the cocoa, all right? Don't drink the cocoa.

Allan Chernoff, thank you.

(LAUGHTER)

HARRIS: It's been a great few months for shareholders in Stewart's media empire. Chief among them, Stewart herself. But what might the future hold? We'll ask "BusinessWeek" associate editor Diane Brady at a quarter past the hour on LIVE FROM.

PHILLIPS: From the heart or off a script? Prosecutors went to the videotape again in Michael Jackson's child molestation trial, today showing the uncut version of the video that was meant to be the Jackson camp's rebuttal to that explosive BBC documentary. The older sister of Jackson's alleged victim has testified the family was coerced into praising and defending Jackson on camera.

We get the latest now from CNN's Miguel Marquez at the courthouse in Santa Maria -- Miguel.

MARQUEZ: My god, and what a video this is, Kyra. It really goes a long way toward helping the defense. So it's interesting that the prosecution did put it up so early in this trial.

The video, it's about an hour and a half long. The sister of Michael Jackson's accuser on the stand watching it, along with Michael Jackson and his mother. Latoya and Jermaine Jackson all in the audience.

This -- the video -- in that video, they talk effusively about Michael Jackson, calling him a father figure, daddy, saying that he saved their lives, that they were broken and Michael fixed them. The prosecution maintains that this video was coerced, that they were coerced into making the statements they were, that they were scripted remarks.

They did not appear that way to me, although they did appear to be heavily-acted remarks. The brother saying in the video that on the first night at Neverland Ranch, it was his idea to sleep in Michael's bedroom. Michael said, "Well, if it's all right with your parents, fine. Come on up."

They did. And the brother -- and his other brother slept in Jackson's bed. And Jackson insisted they sleep in the bed. Jackson and another person, Frank Tyson (ph), slept on the floor of his bedroom that night.

They repeatedly called Jackson "daddy" and "father" throughout the thing. The mother, at one point, used language such as this: she said, "God elected to work through Michael and breathe life into my son." Remember, he was suffering from cancer, and a very serious cancer at the time, and she believes that Michael Jackson was responsible for him becoming healthy, at least according to this video. Said that Jackson was responsible for supplying him with the O Negative blood, a very sort of rare blood type that he had, and Jackson was responsible for getting the O Negative blood that he needed in order to survive.

She's also testified a little bit today. The cross-examination has just begun by Tom Mesereau, Jr., Mr. Jackson's attorney. They are slowly getting into the facts that they want to get into.

Before he started testifying -- started questioning her, though, she did indicate that she saw what she thought was inappropriate behavior between Mr. Jackson and her brother, saying that Mr. Jackson had -- was always hugging him and kissing him and sort of holding him very closely. But it's hard to tell. Given what they said in the video and those actions, they seem to be consistent at the time.

Right now, though, there seems to be inconsistencies in the defense. They're starting to work on their side of the story.

Back to you.

PHILLIPS: All right. Miguel Marquez, thank you so much. And one other case to tell you about. Robert Blake's fate is almost in the hands of the jury.

Defense attorneys are winding down their arguments. Jurors could get the case after prosecutors get a chance to make rebuttals. Blake is charged with killing his wife in 2001, and if convicted could be sentenced to life in prison.

HARRIS: And news "Across America" now.

President Bush nominates Stephen Johnson to be the new chief at the Environmental Protection Agency. Johnson is currently acting administrator at the EPA. Mr. Bush told the news conference Johnson will be the first professional scientist to head the EPA.

In Chicago, the FBI offers a $50,000 reward for information offered on the murder of a judge's husband and her mother. Officials are interviewing the relatives of a white supremacist who was jailed for earlier plotting to kill the judge. Police say white supremacist groups are just one avenue of their investigation.

And mean monkey business. A man is severely injured after a violent attack by chimpanzees at an animal sanctuary in Caliente, California.

He was mauled on the face, hand and foot after he and his wife brought a cake to another chimp. The two animals that attacked him were shot and killed.

And these are pictures just into CNN of a roof collapse of a PETCO store in -- this is in Eatontown, New Jersey. At least two people are inside that building trapped.

Earlier, six people were in the building. A number of them were rescued. Two people remain trapped inside that building.

And we understand that a construction crew working in the area damaged an unmarked gas line. A gas explosion is responsible for this explosion.

Live pictures now. A roof collapse at a PETCO store in Eatontown, New Jersey. We will continue to follow this story.

PHILLIPS: A reprieve for the Boston teacher who faced deportation today. A judge had ordered that Obain Attouoman return to his native Ivory Coast after he lost an immigration appeal. But that order has been overturned thanks to lobbying by his students and the office of Senator John Kerry.

(UNINTELLIGIBLE) of affiliate WHDH has the story.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: Obain Attouoman might just be the happiest man on Earth as he embraces his students returning from Capitol Hill.

OBAIN ATTOUOMAN, WAS FACING DEPORTATION TODAY: I don't think that I could ever repay you for what you did.

UNIDENTIFIED FEMALE: You don't need to repay us.

UNIDENTIFIED FEMALE: Every time that you do anything for us, every time that you help a student with math, every time that someone passes a test, that's how you repay us.

UNIDENTIFIED FEMALE: You repay us with our education.

UNIDENTIFIED FEMALE: In a last-ditch effort to keep Attouoman him in the U.S., his students met with Senator John Kerry yesterday in Washington, D.C. Minutes after, Kerry filed a special legislation allowing the Fenway High School teacher to not be deport back to the Ivory Coast, a place he now fears.

ATTOUOMAN: This is an example of some of the things that prove that this country is still one of the greatest countries. Not one of the greatest countries in the world, but the greatest country in the world.

LUCRETIA WILLIAMS, STUDENT: This man was just this close to being gone from us forever. And, you know, we went out there and we said what we said, and we told them how we felt and how much he meant to us. And he's here.

UNIDENTIFIED FEMALE: Attouoman received a standing ovation as he entered school today. He says he's now living his American dream, and he owes it all to his students who never gave up.

UNIDENTIFIED FEMALE: I feel so overjoyed and happy. We've done a lot so far. We have more to do. We have more to do.

(END VIDEOTAPE)

PHILLIPS: Attouoman fled to the U.S. in 1992. He was jailed twice in the Ivory Coast for political activity.

Straight ahead, she could reportedly make $100,000 an episode for her upcoming reality TV show. But in reality, will Martha Stewart continue to be a long-term money maker? We're going to talk about it straight ahead.

A campaign to get some respect for women in music videos. We'll go in-depth on the image issue straight ahead on LIVE FROM.

(COMMERCIAL BREAK)

(WEATHER REPORT)

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HARRIS: Martha Stewart is enjoying her first day at home following her release from prison. She smiled and waved while boarding a private plane overnight for a flight to Bedford, New York.

So what is next for Martha and her empire? Well, for starters, two television shows, a possible clothing line and a regular magazine column.

More now from "BusinessWeek" senior writer Diane Brady in New York.

Diane, good to see you.

DIANE BRADY, SENIOR WRITER, "BUSINESSWEEK": Nice to be here.

HARRIS: All right. I'm going to start you off with a little true or false question.

Martha Stewart steps out of prison and into a more lucrative environment than when she landed in prison five months ago. True or false?

BRADY: Definitely true. In fact, it's incredible. Even if you look at her paper wealth, the stock has quadrupled essentially in the last several months. So she's now a billionaire again on paper.

Plus, she has this TV deal that will give her about $100,000 an episode. And we're hearing about a book as well that could be as much as $10 million.

HARRIS: Diane!

BRADY: Wow!

HARRIS: What has happened here? She went to prison! She's a convicted felon, and you're telling me she's coming out of prison a billionaire, having made more money?

BRADY: Well, you know, it's an amazing comeback story. This is a woman who -- it's almost classic. Like she flew too close to the sun, she fell to Earth, and all of a sudden she is an underdog. So she looks a little more human.

I think the fact that she went to prison impressed a lot of people because a lot of people felt that the government should never have brought this case forward in the first place. This is a woman who was never charged with insider trading. She was charged with lying, but some people think of it as like the type of lie you say when you're speeding.

Some people think it's more serious. But she's definitely taken her lumps. And especially when you look at some of the other CEOs out there who may be getting off, who've actually wreaked havoc and caused thousands of people to lose money.

HARRIS: Yes. Yes, good point. And Diane, I've got to ask you, are you one of those people who believe that she was treated in any way unfairly?

BRADY: I think that this is a case that -- I don't think she should have gone to prison. I think the government wielded a baseball bat in this case. I think she could have easily gotten off with severe fines. There is no question she's been punished in terms of the company. If you look at her company, they've just recorded their second straight year of losses. So for all the euphoria surrounding Martha...

HARRIS: Right?

BRADY: ... advertisers and subscribers have not come racing back.

HARRIS: OK. That was my next question. If you take the business apart, and let's start, let's say, with the magazine, the magazine has been hurt, hasn't it?

BRADY: Very much so. In fact, they lowered their rate base. So they've got about 1.8 million readers.

There are a lot of other competitors out there like "Real Simple," Oprah's magazine, so Martha is no longer the only game in town. And personally, I thought the loss of her to-do calendar, where you saw her doing -- repairing deer fencing and doing all the other stuff.

Once Martha went out of the magazine, it seemed to lose a bit of the luster. You can tell because they're chomping at the bit to have her back.

HARRIS: Right.

BRADY: In this month's issue they talk about her foraging for greens. She's back doing a column. They knew full well that Martha is the appeal of that magazine.

HARRIS: OK, Diane. For those of us who aren't, you know, real handy with things...

BRADY: I'm one of them.

HARRIS: Yes -- been living under a rock or something, Martha Stewart, what is the cornerstone of her industry? What is the secret to her success here?

BRADY: Well, I think, first of all, she raised, you know, home -- she raised housekeeping to a high art. Some of the things she does are patently silly, frankly, massaging turkeys for three days before Thanksgiving.

HARRIS: OK.

BRADY: But I think essentially she taught Americans how to live the good life, and then she sold them all of the products to do it. She is a consummate marketer, and she's the personification of her brand, unlike almost any other.

HARRIS: So, Diane, what does she do now? We've talked to just about... BRADY: Preparing cocoa.

HARRIS: Yes, and bread and cocoa. So what does she do now? What kind of a tone does she need to strike? Allan Chernoff mentioned to us that she doesn't get her titles back right away, if ever. What does she do?

BRADY: Well, you know, it's a good question, because there's no -- her brand has changed. This is not a woman who personifies perfection anymore in the kitchen.

We've seen her in court. We've seen people come out and say, you know, she's a nasty boss, she can be rude on the phone.

So I think that she's going to be a little humbler, certainly. We know she's been an advocate for prison reform. I'm sure her advisers don't want her to, you know, talk too much about that, but I think she will be a different person, a humbler person. But she's going straight back into the kitchen and the garden, and we'll be seeing a lot of Martha Stewart.

HARRIS: Diane Brady, senior writer for "BusinessWeek." Diane, good to see you.

BRADY: Good to see you, too.

HARRIS: OK -- Kyra.

PHILLIPS: Live pictures right now of what we believe to be a rescue that's taking place. L.A. County firefighters and rescue crews -- what we know so far is that a car went over the embankment about 200 feet down in Malibu. I'm not quite sure if it's off the PCH, the Pacific Coast Highway or not.

I'm told this is Canyon Dune Road. But where the firefighters are, where the rescue crews are right now, and where they have taken this body and put it in the basket, is quite -- I would probably say about 25 feet from where the car went down -- or where the car is of the embankment.

So we're not quite sure if crews were able to take at least one victim that we know of so far out of that car or if, indeed, this individual flew from the vehicle after rolling down the embankment about 200 feet down from the road where it was traveling. Not quite -- not sure right now of the condition of the victim.

Now back to a live picture. We had shown you some videotape of the vehicle. Now rescue crews there, live pictures, via our affiliate KTLA, of that victim inside the basket.

What's interesting is sometimes -- and many times like this, you'll see the basket air-lifted via a helicopter. But I guess the best guess -- and I shouldn't guess -- but it could be that this individual has such severe injuries that they've got to be a lot more careful. And the turbulence wouldn't be good for the victim there. So firefighters now have the body in the basket, and they're sort of slowly making their way up that canyon. Two hundred feet they're pulling the basket up. But it does look like it is attached by some type of cable. They could be getting some help from above.

We saw an L.A. County helicopter land just moments ago, possibly the helicopter that's going to take this individual into the hospital. But right now, all we know is that this car, it looked like some type of white SUV, white van, went over the embankment off Canyon Dune Road there in Malibu, California.

So far, we know of only one victim. Don't know if there are any more. Rescue crews right now trying to work their way up the canyon 200 feet, with at least one victim that we know of inside that basket.

We're going to continue to follow this story and let you know as much as we can. And it has caused a lot of traffic, a lot of backup there on that road. You can't see the shot right now, but we saw the long line of cars.

We're going to take a quick break. More LIVE FROM right after this.

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(BEGIN VIDEOTAPE)

VERONICA DE LA CRUZ: What's next for the domestic diva? For all things Martha Stewart, you can visit CNNmoney.com/martha. The online special chronicles the homemaking maven's life from her days on Wall Street to her conviction a year ago for lying to investigators about a personal stock sale.

But did that five months out of the spotlight help her career and her company? Brown Keys Research (ph) found that Stewart's image has steadily improved in recent months after hitting a low a year ago.

And what do you think? You can weigh in online with CNNmoney.com's Battle of the Sexes" quiz. In this scientific poll, both men and women were asked how they felt about Stewart.

For example, more women than men say that if a male business executive had been in the same situation, he would not have been prosecuted. But both genders agree that the businesswoman will bounce back after leaving prison.

With that said, Martha Stewart is already slated to star in two TV shows, a daily talk show and a spinoff of "The Apprentice."

From the dot.com desk in Atlanta, I'm Veronica De La Cruz.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

HARRIS: Martha Stewart's release from prison isn't helping the company's stock much today, Kyra.

PHILLIPS: Kathleen Hays following that from the New York Stock Exchange, and a look at other -- well, I guess, Wall Street's perspective on the media company.

(STOCK MARKET REPORT)

(COMMERCIAL BREAK)

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