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CNN LARRY KING LIVE

Interviews With Relatives of Missing Mississippi Family, Michael Eisner

Aired February 20, 2004 - 21:00   ET

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

LARRY KING, HOST: Tonight: Michael Eisner, chairman and CEO of the Walt Disney Company, his first and only interview about the battle for control of one of the biggest names in all of show business, under fire from the outside, a hostile takeover by Comcast. Let's see what happens. We'll get the inside story from Walt Disney's own man himself, Michael Eisner, the chairman and CEO.
But first: A mother, father and their 4-year-old son have vanished into thin air nearly a week ago, bloodstains, bullet holes and shell casings all that's left behind in their quiet Mississippi home, on the same property where the husband's father was brutally murdered 10 years ago. What's happened to Michael and Rebecca Hargon and their son, James? Their brother, sister and close family members will join us with an emotional plea next on LARRY KING LIVE.

One quick note. Regis Philbin was due to be one of our guests tonight. He has terrible food poisoning. We wish Regis the best and hope he gets better real soon.

It's been nearly a week since Michael and Rebecca Hargon and their 4-year-old son, James Patrick, have vanished. Authorities still treat the disappearances as missing persons cases, but investigators have found dried blood droplets, bullet holes and shell casings at the Hargons' home in the small town of Vaughan, Mississippi.

Five members of the family are there, but two will be speaking with us. They are Billy Hirtz, the brother of Rebecca Hargon, the mother, and Lee Anne Crow, the first cousin of Michael Hargon, the father, the daughter of Judy Hargon.

Billy, what happened? When was the last time you saw them?

BILLY HIRTZ, BROTHER OF MISSING WOMAN, REBECCA HARGON: We saw them last weekend, Larry. We were all here for James Patrick's birthday party.

KING: And what happened? You left the -- they were home when you left the party? Was the party at their house?

HIRTZ: Yes. Well, they had it earlier at Chuck E. Cheese (ph), and then, yes, naturally, the party continued at their home.

KING: And were you there, too, Lee Anne?

LEE ANNE CROW, COUSIN OF MISSING MAN, MICHAEL HARGON: I was at Grandma's on the Sunday of James Patrick's birthday party that we had at Grandma's house.

KING: And then you left the house, and what was the -- what happened?

CROW: We do not know. James Patrick's birthday party was the weekend before the disappearance.

KING: All right, and he was...

CROW: And all we know is -- I'm sorry.

KING: You haven't seen -- nothing about them since.

CROW: No, sir.

HIRTZ: No.

KING: James Patrick is how old, Billy?

HIRTZ: He's 4 years old.

KING: OK. Do you know any -- of any threats on their life, any -- do you have any possible thoughts of what could have happened?

HIRTZ: No, none at all. No, this family was -- was -- is very loved by this community and -- you know, and they loved them, as well. I couldn't see anyone having any ill will towards them. They were a loving family. They were a loving couple. Everyone loved them. They live in a strong community. It just makes no sense whatsoever.

KING: And there were no signs of robbery or forced entry, right? In fact, we learned that Rebecca's wedding and engagement rings were left behind, is that correct?

HIRTZ: That is correct.

KING: What about the family cars, Billy?

HIRTZ: All the family cars were still -- were still accounted, you know, for. There was Michael's work truck, his personal truck and then Rebecca's SUV. They were -- they were all there.

KING: Lee Anne, has there been a big search of the area?

CROW: Yes, it has. Mississippi state troopers have had two helicopters that have been searching the area. There have been foot searches, searches with dogs.

KING: Billy, how did you learn they were missing?

HIRTZ: I got a call Saturday, early afternoon, from my brother- in-law and said that, basically, We can't find Rebecca and Michael and James Patrick. Nobody knows where they are. And basically, I just kind of said, Well, just give me just a minute. I'm sure they're there. And he said, Bill, you need to come on. So from there, he called my family, my parents, our parents from Missouri, and we all rushed over. And we haven't -- haven't heard or seen them since. I talked to her...

KING: Now, both...

HIRTZ: ... briefly on Friday...

KING: Yes?

HIRTZ: Go ahead.

KING: Both parents work, right? Michael's a construction worker, Rebecca is a physical therapist assistant, right?

HIRTZ: That is correct.

KING: Now, Tell me about -- Michael's father, in the same location, was killed 10 years ago. What happened, Lee Anne?

CROW: My uncle was murdered at his small country store 10 years ago. Three men came in, robbed him, murdered him.

KING: Are they in all prison?

CROW: Yes, sir, they are. All three are.

KING: So they're not suspects, right, Bill? They couldn't be suspects. They're not out of prison.

CROW: No, sir. All three of them are still in prison. One of them was just denied parole. The Wednesday before they disappeared, Michael had gone to the parole board hearing for one of the people, and we've just found out in the last day or so that parole was denied for that person.

KING: Do you have any guesses, Billy, as to what who might have had something against him or her or them?

HIRTZ: Not at all. None. It just makes no sense.

KING: Do you know of anyone, Lee Anne...

HIRTZ: Michael was the kind of person...

KING: I'm sorry. Go ahead, Billy.

CROW: No, sir, I don't.

HIRTZ: I was just going to say that Michael was the kind of person that, you know, if he had a cross word with anybody, he couldn't stay mad at them more than 10 minutes. He couldn't bear the thought of it. Everyone liked Mike. Mike's a great, hard-working man, and he -- I mean, he was just well loved, and he has a great family. And just again, it just -- it's just insane.

KING: Well, the dried blood and the bullet holes have to cause you a lot of concern, right, Billy? HIRTZ: Well, obviously, it does. And we're hoping to hear something from the investigators soon about the -- you know, whose blood it might be and -- you know, and maybe some more information on, you know, what has happened, what transpired in that house that night.

KING: Is there a reward being offered?

HIRTZ: Yes, there is. There's $1,000 offered by Mississippi Crimestoppers, and then there's a $25,000 reward offered by our family.

KING: Was the marriage a happy one?

HIRTZ: Oh, absolutely. I mean, you know, they were a normal married couple with a -- you know, with a happy child, and they loved each other very much. If they had problems, they were just like problems like everyone else. I mean, they were simple and minor. They were nothing major.

KING: What do the police tell you, Lee Anne?

CROW: They're not telling us much at all. They are just doing their jobs. They are doing the investigating. We hope that -- that they are coming to some conclusions that they can share with us shortly. They haven't told us much at all, but I take comfort in the fact that they're doing their jobs.

KING: Now, Billy, if anyone...

(CROSSTALK)

CROW: ... give us an answer soon.

KING: If anyone watching thinks they see them or something, who do they contact?

HIRTZ: They need to contact the Yazoo County sheriff's department, the Mississippi Highway Patrol, the Mississippi Bureau of Investigation or the FBI.

KING: All are involved in this case.

HIRTZ: Absolutely.

KING: Thank you all very much. We wish you nothing but the best. Billy Hirtz, the brother of Rebecca Hargon, Lee Anne Crow, the first cousin of Michael Hargon. Again, it's been nearly a week. Michael and Rebecca and their 4-year-old son, James Patrick, vanished. We've been showing the pictures. If you think you know where they are, contact the Yazoo County sheriff, the Mississippi state police or the FBI. And we thank the whole family. We understand how tough this can be.

We'll take a break, and then Michael Eisner, the chairman and CEO of Walt Disney. Don't go away.

(COMMERCIAL BREAK)

KING: We now welcome -- we'll take calls later -- return visit, it's always good seeing him -- Michael Eisner, the chairman and CEO of the Walt Disney Company.

You've seen better days. How rough has this been for you?

MICHAEL EISNER, CHMN., CEO, WALT DISNEY CO.: Well, actually, it's a very good period for us. The company is operating fantastically, and you know, tourists are back. International tourists are back. We had the biggest year in anybody's history in the movie business. ESPN is rolling. So as far as the essential part of our business, we're doing great. And my family's doing great.

KING: So what do you make of the Roy Disney uproar, to try to take over the company, or if not take over, have you leave? What are you feelings about that?

EISNER: You know, I've been doing this a long time, and you spend a lot of time trying to do what's right and concentrate on the bottom line and concentrate on creative excellence, and sometimes you have disagreements with people. And I've had some. It's always in the interest of trying to do ethical and excellent work. And sometimes people don't agree with you. And I've had it before, and this will go away, I believe.

KING: Are you surprised at how far he's taken the disagreement?

EISNER: I am surprised because our performance has been so good and our creative output has been so superior and we've never done better in our history. And I really can't comment on other people's motives.

KING: What's his No. 1 reason? I mean, what does he state when he -- what did he tell you when you had -- in other words, when he said, "Michael, do this," what was he saying he thought should be done?

EISNER: We actually never had any of those conversations.

KING: Never?

EISNER: No. And maybe that's part of the problem. But in any event, they have decided, to the extent that they want to be critical, to be critical. I have decided to not get in the fray. I actually have a lot of respect -- I tend to have respect often for people that disagree with me, and I don't want to get into a contest about issues that are not really relevant to what I have to get done, which is I have to make sure that we continue making great movies. I have to make sure that ESPN continues to roll. I have to encourage and be a cheerleader for a great group of executives, including ABC and our theme parks and international and all of the things that I have to do. And I have to continue to be a father and a husband, and I think I'm going to concentrate on that.

KING: OK. Were you surprised at this? EISNER: Sometimes...

KING: Did you see it coming?

EISNER: I had some sense that everybody in my life isn't happy.

(LAUGHTER)

EISNER: When you're turning people down or you're trying to get a certain kind of creative excellence and when you're trying to make sure you're a contemporary company and you're relevant and you're still trying to honor the past, everybody doesn't agree with everything you're going to do. And I just made a decision a long time ago in my life that if you do the right thing -- what you think is the right thing, not what you think is the expedient thing, not the thing that you expect maybe the media would think was correct and maybe not the thing that you think everybody would stand up at that moment -- but to do something that may look like a good headline in "The Wall Street Journal" that you know six months later will turn against you because it was an expedient, incorrect thing to do -- you don't do that.

KING: So you have to take hits, then.

EISNER: You know, you do take hits. But at the end of the day, I think you get rewarded for being honest and being passionate about what do you and being focused.

KING: One could say, Michael, you got all the money you'll ever need. You've had heart surgery. I know what that's like to go through. Why not -- why do you need this?

EISNER: I love it. I love -- I mean, it's almost like saying I love the smell of greasepaint, that kind of, like, cliche. I love the work. I love going and seeing "Lion King" on Broadway. I love that we're doing "Mary Poppins" on Broadway. I love flying to London and seeing what Cameron McIntosh (ph) is going to do with "Mary Poppins." I love sitting with our animation department and hearing what they're going to do. I -- I just -- I'm invigorated by it, and I actually think it's what keeps me healthy.

KING: Are you -- is part of the being -- of making this difficult the fact that the man -- one of the men opposing you is named Disney? I mean, does that add to the dilemma?

EISNER: Well, I've thought of changing my name to Disney.

(LAUGHTER)

EISNER: Well, certainly, if your name is Disney...

KING: That's the name on the cover!

EISNER: ... it's a better name than Eisner. Let me put it that way.

(LAUGHTER)

EISNER: But I've worked hard to try to make the Disney Company the premiere family entertainment company in the world. And I believe that the people that work with us in the motion picture division and the theme parks and children's publishing and the Disney channel and all over the world have a passion that is probably close to the passion that Walt Disney had.

KING: You'd agree your company, unlike other companies, is sort of a loved company by the public. I mean, Mickey Mouse is your symbol.

EISNER: Right.

KING: The people hear the name Disney, they smile. All the executives call each other by their first name, right? You have a unique place, in addition to just being a public company, right? Don't you think?

EISNER: I think so.

KING: All right. What's going to happen March 3 at the stockholders meeting? Do you expect a raucous stockholders meeting?

EISNER: Well, I expect a stockholders meeting like we always have. I mean, we have a stockholders meeting -- we had one at the pond (ph) in Anaheim, 17,000 people showed up. We've had them all over the country. They are the most-attended stockholders meetings ever. We show a lot of our products, our film clips, our movies coming up. We show, you know, a lot of stuff from ABC News. We show stuff from Broadway. We have a lot of questions from kids at the meetings. It's a really entertaining event, which we try to enhance. So in that respect, people do love Disney and people love coming to our shareholder meeting and they love being part of the magic.

KING: But do you expect there to be people standing up and complaining and listening to people who are opposed to you and saying, Why not do this, and why not do that? Do you expect any kind of upheaval?

EISNER: I think upheaval's a strong word. Most people are very civil. I've had -- at every shareholder meeting, I've had people complaining that they couldn't become Cinderella in our parade, to all sorts of much more international issues that are real. We've had shareholders that are concerned about employee benefits. You know, we've had questions about insurance for same-sex partners. We've had everything that any other American company has had.

We have one thing different: People are intently interested in our company. And that's good news. They're -- you know, if -- if Katie Couric or Diane Sawyer -- but hopefully, not Diane Sawyer -- has 500 toys of which they've been recalled, and one of them happens to be a toy from some distant place but is Mickey or Minnie or Goofy, that's the toy that's put up. And that's good news. That means people care. So yes, people will come to our annual meeting and they will care and they will see presentations that will show how strong the company is. KING: You have the complete support of the entire board?

EISNER: I think I have the complete support. I mean, of the -- the board...

KING: George Mitchell said that last week.

EISNER: Well, the board is interested in three things. The board is interested in ethical behavior and ethical conduct by our public company. They're interested in, obviously, all of our constituencies, which includes our shareholders, our cast members, the people that are in the communities in which we operate. And of course, they're interested in performance because we are a public company. And in all three of those areas, we are performing very well.

Now, there is no question that when 9/11 hit and the build-up to the war and the war itself, the effect on tourism and advertising was significant. And there's no question that we put billions of billions of dollars into our theme parks just before that period and during that period. And that was a difficult time for us economically. We did very well. Our management did well. Our cast members kept great humor. Our public that did come to us loved what they did.

Now it's all turning, and everything that we did to get us through that very difficult period is benefiting us. But during that difficult period, in every company, stock prices weren't what they were. Discontent was there. People were nervous about security. People were nervous about direction. People acted in a way unusual for the way they had been acting. A lot of people got themselves financially on the edge. All of these things kind of wrapped into a highly challenged period. We came out of it.

And now I'm up because we've put together a motion picture group that delivered not only "Nemo," because even without "Nemo," we were No. 1, "Pirates of the Caribbean," "Freaky Friday" -- we have a movie out now called "The Miracle," a Disney movie. It is a...

KING: Terrific movie.

EISNER: Interestingly, we have two brands. We have the Disney brand and we have the ESPN brand. These are both beloved brands for different reasons. And the Disney brand -- everything is interrelated. We make a movie, the ride goes to the theme park, consumer products are in the stores, radio Disney plays the music, the Disney channel plays how the movie was made. It comes together.

KING: Synergy.

EISNER: Well, synergy is such an overused word. With our company, it exists, and I think people like that.

KING: We'll be right back with Michael Eisner. Don't go away.

(COMMERCIAL BREAK)

KING: We're back with Michael Eisner. What happened with the Comcast bid?

EISNER: Well, our board analyzed it, and it was insufficient.

KING: Did they call you first?

EISNER: I had a...

KING: There was a story I read that the head of -- Brian...

EISNER: He called...

KING: ... Roberts called you, right?

EISNER: He called. I told him I thought that the board felt we were on the right strategic course. I didn't get much else other than that out. And we got a -- we got an offer. And the board looked at the offer, had outside, obviously, advisers, did their complete fiduciary duty, and determined it was -- it was highly underwhelming.

(LAUGHTER)

EISNER: George Mitchell, former senator, was a guest on this show last week the night of the elections. He's on your board. He said, though, they would listen to higher prices.

EISNER: Well, the board said three things. The board said the offer was not sufficient. Two, We're always open to listen to anything that enhances shareholder value, and we'll study it. And three, We are completely confident in the course that we are on, and we support the management of the company. So those are the three things that the board said in their press release -- said better, more articulately, but those are the three things.

KING: But if you get an offer, let's say Comcast or anyone that's a good company, that's terrific. Don't you have to, even as chairman and CEO, even if it might mean that you will no longer be chairman and CEO, have to say, This is a great offer?

EISNER: If we get an offer that is in the interest of the shareholders, of which I am a fairly large shareholder, we will not only consider it, and if it's really spectacular, we will accept it. It has to be pretty spectacular to get the great assets of the Walt Disney Company. We're not giving away ESPN and the Disney channel and the Disney parks and the Disney studios, and I can go on and on and on.

KING: How under were they?

EISNER: Oh, please!

(CROSSTALK)

KING: How under?

EISNER: They were more under than a breadbox.

(LAUGHTER)

KING: Significantly under?

EISNER: No, no, no. They -- we gave the actual -- the press release gave something -- they were, I think, over $3 less than the current market price of the company, which means, as opposed to being a premium, it was the opposite. And that was also in our press release.

KING: Were you surprised that a company made a bid?

EISNER: Nothing surprises me anymore. I have gotten used to getting up in the morning, getting the newspaper -- my wife puts the covers over her head and says, Now what?

(LAUGHTER)

EISNER: So nothing surprises me. There had been some rumors about it, nothing concrete. And it came right at the time we were about to make a presentation to our analysts.

KING: In a sense, isn't it a kind of tribute that someone, a big company, wants to get and -- wants to have Disney?

EISNER: Well, the tribute -- yes, I consider it flattering. The tribute was they made an offer, and our stock went up and their stock went down, which meant that the shareholders feel really strongly about the Walt Disney Company, and other financial things which I'm not equipped to describe to you.

KING: Are you confident that, in the end of all this, Eisner will prevail?

EISNER: I am confident in the end of this, I will still have three great children, a great wife, and the Disney Company will prevail. Whether I will be running the Disney Company or not is up to our board, up to my health, and up to my continuing enthusiasm, all of which, as of this moment, are there.

KING: So you have every indication of staying on. It would take some kind of unusual occurrence for you not to be chairman and CEO.

EISNER: Where else can you get to the head of the line for Mission Space (ph) at Epcot Center? Where else can you go in the back door and see Mickey's (UNINTELLIGIBLE) at Disneyland and Walt Disney World? Where else can you go tomorrow night, as I'm going, to the opening of Snow White live show at Disneyland in Anaheim? Where else can you go to Hong Kong and watch them build a new park in the most fantastic site I've ever seen? What else can you go and actually be invited to the Super Bowl with ESPN? You think I'm crazy?

(LAUGHTER)

EISNER: This is a great, great company and a great job, and I like it. That doesn't mean that I can't have all those same things by just being a citizen. KING: This Snow White stage show, is it going to come to New York or just for Disneyland?

EISNER: This is just Disneyland in Anaheim.

KING: It's a live musical, right?

EISNER: Live musical.

KING: We'll be back with more of Michael Eisner. We'll include your phone calls in a little while. Don't go away.

(COMMERCIAL BREAK)

KING: Our guest is Michael Eisner, chairman and CEO of the Walt Disney Company. Going to start to include your calls in a couple of minutes.

What happened with Pixar?

EISNER: Well, we had a fantastic run. We found a company that was making commercials. John Lassiter had been at Disney, he's got a lot of pixie dust all over him. And we tried to see if we could make a movie with them.

And we made "Toy Story," and then we made "Bug's Life," and then we made "Monsters," and them we made "Toy Story 2" and then we made "Nemo." And now we have "Incredible"'s coming out this fall and following that another John Lassiter movie...

KING: Both (UNINTELLIGIBLE).

EISNER: ... all from Pixar.

And Pixar and Disney worked together great for all that time. And they are fabulous people. And there's no question that we would have loved to continue.

But like Walt Disney himself when he pulled away from Columbia Pictures and wanted to go on his own, so Steve Jobs and Pixar really want to go on their own.

KING: No bitterness over the breakup?

EISNER: I don't think there's bitterness because we're still in business, we still all know them creatively. I mean it's a very small community.

I would have liked to have continued with them but the deal that was on the table, there was the right deal for Pixar potentially, for them, just did not add value for Disney.

And Disney has invented and reinvented animation twice, and you count Pixar, that's three times. We have a totally enthusiastic animation company. We are making movies in 3-D. We are making all kinds of live-action Disney movies, and we will continue and do very well.

KING: Does Pixar need a hookup with another big company? Is that necessary for their continuance?

EISNER: The only thing they want another company for is to distribute basically their movies theatrically. They want to make their own movies, they want to finance their movies, they want to decide how their movies are exhibited and how the marketing is to be done.

And although we would do that with them, they are -- you know what? They've passed adolescence, moving into full maturity.

That said, I would have liked to have continued to with them.

KING: ESPN signed a long-term deal with Cox to continue (UNINTELLIGIBLE) carry the increased rate. Do you expect that from the other cable companies?

EISNER: We've been talking to the cable companies for a year.

KING: You're increasing your rates of ESPN?

EISNER: Yes, we have been increasing them at, as you know, 20 percent a year for quite awhile in return for bringing the NFL to ESPN.

KING: Cost a little money.

EISNER: It's expensive. The NFL and all of the rest of the sports have delivered to ESPN nine consecutive quarters of ratings growth. A lot of that is due their original programming.

And Cox and everybody realizes that the content is important, and finally, we were able to make a really long-term deal, which is in the interest of Cox and in the interests of Disney.

KING: Do you expect the same from Comcast, from Time Warner? By the way do you expect the same from Comcast?

EISNER: We made a deal with Charter the same day. Well, I would like more from Comcast actually.

KING: You'd like them to pay more?

EISNER: Oh, yes, just because I feel that way.

(LAUGHTER)

KING: How about Time Warner?

EISNER: No, we're talking all of them. We're talking to Comcast -- and I don't do it. George Bodenheimer (ph) and our strategic planning group, Peter Murphy (ph) and Bob Iger (ph), they're spending their time doing it.

KING: What's the prospects for ABC? You're bringing back "Millionaire." Regis was supposed to be with us tonight, he's sick.

EISNER: ABC is an interesting story. ABC is a lot more than just prime time, although prime time has made steady progress, particularly in comedy.

ABC owns stations, eight of them -- of the 10 are No. 1 in their markets. We are very strong in news. Peter Jennings, Barbara Walters, Diane Sawyer, all of the groups -- we are very strong in news. We're very strong. George Stephanopolous is doing a great job. The morning show is strong.

Our daytime -- since I started and put those soap operas on the air, they're still No. 1. We now have Soap Net which is a cable service. ABC -- Jimmy Kimmel...

KING: Is it working?

EISNER: This guy is a star. This guy going to be the next big star on ABC.

So where's our problem? Our problem has been in turning around prime time as quick as our critics would like. And I think the company has done a good job. I think we are strong in comedy. We got blown out of the water this spring with Donald Trump. What can I say? Who would have ever thought?

But anyway, we got blown out of the water. And it doesn't matter, because that's a momentary and a short cycle thing.

The strength of a No. 1 schedule under Bill Paly at CBS and NBC for the last 100 years is comedy, comedy, comedy. That's where we've concentrated.

KING: But you're bringing back "Millionaire" for $10 million.

EISNER: We're bringing back "Millionaire" for an event of five episodes and I think it's going to be gigantic. And who can deny Regis Philbin prime time?

KING: Did you over do it the last time, play it too many times, you think?

EISNER: Yes.

KING: Too many nights week?

EISNER: Yes.

KING: Irvine, California, as we start to include some calls for Michael Eisner. Hello.

CALLER: Hello, Larry.

KING: Hi.

CALLER: My question to Mr. Eisner is regarding Roy Disney's statements that the theme parks are made on the cheap. Mr. Eisner, I actually visited California Adventure and the only really good ride is Soaring Across America. Other than that it's not worth a separate admission price. Just the same as Downtown Disney which is free.

And I totally agree with Roy Disney. For me to take my family there and have one good ride is too much money.

EISNER: Well, I would say that, obviously, I don't agree with you. I think the Aladdin show is great. I think a lot of the Paradise Peer is great, especially for kids. You probably -- you may not know Tower of Terror is coming in the spring.

KING: Tower of Terror?

EISNER: Tower of Terror which we have in Walt Disney World which is like our No. 1 attraction in Orlando.

So we built this park to compliment Disneyland. We're now expanding it. Did you take your kids to a Bug's Land?

KING: She's gone.

EISNER: Oh she's gone. OK. Well if she was still listening...

KING: Did he say it was built on the cheap though? Did he say that?

EISNER: I think part of the rhetoric -- I don't know where it was from -- is people being critical of our parks. It really is not true. These parks...

KING: Do you spend a lot of money in those parks?

EISNER: We spend much more money than most of our investors probably would think was appropriate. We have spent an enormous amount of capital on the parks. And actually they wouldn't think it's appropriate because we're now benefiting from all of that.

We have to put a moat around Disney that nobody can do it as well as we do, that nobody adheres to excellence. We paint Disneyland every night. I mean our cast members are maniacally trained and maniacally friendly.

We include new rides, we redress Pirates of the Caribbean and It's a Small World for Christmas. We have new shows in there, the Aladdin show. We have a major -- a key to the program. So I think that's just not true.

KING: Before we take our next call, why did you buy the Muppets?

EISNER: I love the Muppets.

KING: I love the Muppets.

EISNER: When I was 20-whatever, working at ABC I met Jim Henson.

KING: Great guy.

EISNER: He and I -- he and I. I was the buyer, he was a creative person. So it wasn't he and I. It was he and I was smart enough to be there. Made their first television special. And I kept up with him all those years.

And then about 14 years ago we made a deal to bring the entire company inside of Disney, and the day before we were to sign the deal, he died.

That was a horrible situation and it was horrible for everybody, particularly his family. And then because of taxes and all the rest of it, we couldn't bring it together. And all these years have passed and different transactions.

To me, Kermit is one of a kind. Mickey is one of a kind and Winnie the Pooh is one of a kind. And I think we have the ability with our company, with synergy and the Disney Channel and movies and television to have Kermit become as strong as Winnie and Mickey.

KING: Kermit has to come back though. He's been away awhile, right? We don't see the Muppets much.

EISNER: We'll bring them back.. We do that.

KING: Big?

EISNER: Big time.

KING: Full-length movie again?

EISNER: We will do everything we can do with Kermit. By the way, that's a real character. He has all the same qualities...

KING: He's been on our show many times.

EISNER: He's a little mischievous, he's kind of got a twinkle, good sense of humor. Who else is like that? Mickey's like that, Winnie's like that, he's like that. There are not many that are like that.

KING: You got a point.

By the way, the thought left my mind, I was going to ask you -- Los Angeles, hello. Los Angeles.

CALLER: Hello. How could someone like me with no connections get to someone like you with an idea for a situation comedy that has never been done before and when it's been touched on the news through my own life, the publicity was unbelievable. It beat out the Monica Lewinsky story a few years ago?

KING: What do you do with a sitcom idea?

EISNER: Well we have to be careful because of...

KING: Copyrights?

EISNER: ... all of the things that are involved.

KING: What's your creation (UNINTELLIGIBLE)?

EISNER: The most important thing to do is to try to find a lawyer or an agent that somehow is involved in the entertainment business who will advise you how to get it to the appropriate network or the appropriate cable system, because if you just open it up for anybody to send it in...

KING: They wouldn't read it.

EISNER: It would be difficult. You'd be inundated. But there are ways to do it. If you write my office...

KING: You'll answer.

EISNER: I'll answer and tell you ideas about how to try to get it to the right person.

KING: I've known people, if you write to Michael Eisner at Disney in Burbank you get an answer. I know, what I was going to ask you. When is the Winnie the Pooh lawsuit going to end?

EISNER: We want to set a record we have the longest lawsuit in the history of American jurisprudence. I think it's on track. I can't comment on that.

KING: Are you going to win it?

EISNER: You know, it's a lawsuit. Lawyers...

KING: New York City, hello.

CALLER: Hello, Mr. Eisner.

KING: Yes, go ahead.

CALLER: I would like to know why are the Disney stores closed in New York and in the malls?

EISNER: They're not all closed in New York or in the malls. We've closed some of the stores that are not performing as well as others, but the store on fifth avenue in New York is a great...

KING: I was just there.

EISNER: You were just there? It's a great piece of Disney. I suggest you go there. But there are other stores, and of course, there are the parks.

KING: Why did have you to close some of the stores? Did you go into too many?

EISNER: The world -- no, the world has changed. The world is changed by Wal-Mart. The big discount, the Wal-Marts, the Targets, the Kmarts, have changed the way Americans shop. And the specialty retail stores inside malls have challenges, in competing in at least, the kinds of things that we deal with.

So, what we've done is, we've made very successful arrangements with Wal-Mart and others and are really doing very well there, better than we ever thought we would.

KING: You mean, Wal-Mart is selling Disney merchandise?

EISNER: Yes. Absolutely.

KING: Isn't that a departure for you,

EISNER: It's just a change of direction.

KING: Because you protected your trademark for much.

EISNER: That protects our trademark.

KING: I know, but -- it's hard to go into a typical toy store and buy Disney.

EISNER: No, there's still Disney in all the toy stores. And there's still Disney in all the different stores.

KING: There is?

EISNER: Absolutely.

KING: Seattle, hello.

CALLER: Hi, Michael, I heard you and all the Disney executives have to work a day at Disneyland so you can keep it real. And I heard that you choose to sell hotdogs and I just think what a great way to run a business and do you have a funny story surrounding that?

KING: Is that true?

EISNER: It is true. It's kind of a pathetic story actually, because what they do is they, when we do it, we do it on a cast holiday, so for 25,000 or 30,000 people in the park are people that work for us, so they reduce all of the prices to cost to give a break so the computers are no longer, you don't push hamburger and it figures out what you charge. It's like the old days.

KING: Total it up.

EISNER: You have to do it all in your head, you have to got give right change, you go back to when I was a waiter and I found it, when people talking to me I was making too many mistakes.

KING: You cost the company money.

EISNER: No, I think I -- no, I think...

KING: Okay. Why is the meeting in Philadelphia?

EISNER: We always pick a meeting in a place in which we do business and Philadelphia has WPDI, which is out -- probably our strongest television station in the world.

Actually I think the ratings of PVI, which is the old Annanburg (ph) Station and the Capitol City Station is as strong as all the other stations combined. It's that dominant in the market.

KING: More with Michael Eisner right after this.

(COMMERCIAL BREAK)

KING: We're back with Michael Eisner. We go to Detroit. Hello.

CALLER: Hi, Mr. Eisner. First of all, I'd just like to say we loved the millionaire game at MGM. And would there be any possibility that you could bring Regis back for prime time since it's such a good educational show for all generations?

EISNER: He's actually coming back beginning Sunday night for five episodes on a super millionaire. So...

KING: Five episodes. Do you see ever that show returning?

EISNER: It may return in the way we're doing it now, sporadically, events. I don't think we'll put it back on four days a week, 52 weeks a year.

KING: "Newsweek" magazine says you approached Time Warner's Jeff Bukes as president of ABC.

EISNER: Not true.

KING: Not true. Nice guy, though.

EISNER: Very nice guy.

KING: Timmons, Ontario, hello.

CALLER: Hello, Larry. I really enjoy your show.

KING: Thank you. What's the question.

CALLER: My question is for Mr. Eisner. We -- I had visited Disneyworld back in the '80s and we really, really enjoyed it. And somebody was saying that Walt Disney, at one time, when he passed away, they had froze him. Do you know if...

KING: Did you ever hear that story? It's been around for years. Did you ever hear of that?

EISNER: He's not frozen.

KING: Not frozen. EISNER: I promise you. I have been to the cemetery where he is resting. His wishes were that it was unmarked, and not available to anybody to ever find out. But I went up there and I talked my way into them showing me where he's buried.

KING: Do you know why unmarked?

EISNER: I think he didn't want -- he want of wanted his privacy forever.

KING: Even in eternity.

EISNER: And his wife did, and I respect that. It's a beautiful, little spot and nobody could ever find it, and I'm very proud that I talked myself into it.

KING: Did you ever know him?

EISNER: No, I did not know him.

KING: Annette, Louisiana, hello.

CALLER: Hi. My question for Mr. Eisner was, MGM is one of my favorite places in Disneyworld and one of my favorite attractions there is the animation studios, and now the studio, the animation studio there is closed, and everything has moved to California, and I wanted to know how you justified doing that.

EISNER: Well, everything has not moved to California. We will still be demonstrating animation in Florida. We will still be doing certain cell animation in Florida. And it's going to be the same great attraction that it always has been.

We consolidated a lot of the creative work back in California in our building, so that we could participate in the rejuvenation and the rebuilding of three-dimensional animation which really has to take place in one location.

KING: How is Paris doing?

EISNER: Paris is doing amazingly well considering the fact that last summer, they had that heat wave, which was a tremendous problem.

KING: Terrible.

EISNER: It is now like the rest of our products around the world, people are coming.

KING: Were you the morning of 9/11?

EISNER: I was in my house here in Los Angeles.

KING: And when you saw that, you must have, obviously we all felt the same. Did you know how hard that would hit, particularly, your business? EISNER: Well, my son was in New York there. I am from New York, and I had a sense of it. I never got out of my underwear until about 3:00 in the afternoon, because I went right to my computer and right to my telephone and talked to everybody all over the world, and we had a pretty quick sense where that kind of quake that people would be nerve to us travel, and it was pretty immediate.

KING: Hit almost like -- did you close the parks for awhile?

EISNER: For some of that day, we closed the parks, but interestingly enough, people did not cancel their already made reservations for that Christmas, but they weren't making future reservations.

KING: Did they watch the airspace over you? Did they treat you as a major security area, the government?

EISNER: I don't want to go into that in great detail but we have a lot of cooperation with the Homeland Security Department, with the FBI, CIA, as every place does, but we're, we don't think...

KING: You're a unique target.

EISNER: Well, we don't think we're a target.

KING: We'll be back with our remaining moments with Michael Eisner. Tomorrow night we'll repeat the interview with Jeff Skilling. On Monday night Jeff Gordon and Dale Earnhardt Jr. NASCAR champions pairing together for the first time, and next Thursday night, I'll moderate the debate, the Democratic Party debate at Southern Cal. University co-sponsored by CNN and the "Los Angeles Times." I will host that debate. It's 90 minutes. We'll be right back. Don't go away.

(COMMERCIAL BREAK)

KING: We should mention that ABC ain't going to do bad Sunday night in prime time, you got the Academy awards a week from Sunday.

EISNER: Right, we have them almost every year, every year.

KING: You think "Nemo" will win for animated feature?

EISNER: Yes, for best picture, definitely.

KING: Burbank, hello.

CALLER: As a stockbroker, I know your parks are doing well but I have concern that a lot of families can't go with a lot of children because of the prices, and I know when Walt opened it up, he said that it was for everybody to be able to go to. Would you lower the prices in the future for families?

EISNER: We have many promotional programs for residents, times of year when prices are lower. There are always discounts and available ways to find the down periods to come to our parks. That said, compared to a seat at an athletic contest, four hours of skiing, we think our prices are very reasonable, and all of our research for people that actually come find they get tremendous value for the cost. Yes, we understand when you have a large family and you travel far.

KING: You take underprivileged, too?

EISNER: We have all sorts of programs for all those kinds.

KING: Los Angeles, hello.

CALLER: Hi, Michael. I support you in management. I think you guys are doing great and I wanted to know, what is your favorite Disney ride at any Disney park?

KING: The favorite ride.

EISNER: Well, I'd like to talk to you for about a half hour. Can we keep her on for about a half hour? It's like talking about your children. Usually my favorite ride is the last one I was on, but I would say Tower of Terror, which is coming to Disneyland is pretty spectacular. I like Big Thunder. I've always liked Big Thunder. Mission Space in Florida is awesome. It's a whole new technology. You know, I'm now get a call from our people in the design group saying how come you didn't mention my ride.

KING: Is Small World still popular?

EISNER: Small world is awesome. I have friends who have little babies or grandchildren, and it's mesmerizing. When we do it at Christmas and completely redesign it for Christmas, it's always unbelievable. It's unbelievable.

KING: That was first introduced at the New York World's Fair, 1964, the Pepsi exhibit. The Pepsi-Cola exhibit and they moved the whole thing to Disneyland.

EISNER: And Lincoln came with them.

KING: Thank you, Michael.

EISNER: Thank you.

KING: So the shareholders' meeting is March 3, right?

EISNER: That's correct.

KING: In Philadelphia?

EISNER: No, Baltimore. No, I'm kidding. I'm kidding.

KING: Go to Baltimore, folks. How long does it last, by the way? Is it one day?

EISNER: It's a morning, morning into the early afternoon.

KING: Just a morning with all the things you described? EISNER: And then through the evening to breakfast the next day.

KING: Michael Eisner, chairman and CEO of the Walt Disney company today. We're only kidding, Michael. I'll be back in a minute and a half and two minutes actually, and tell you about the weekend and Monday. Don't go away.

(COMMERCIAL BREAK)

KING: Tomorrow night, we'll repeat the end of the only television interview Jeff Skilling has done. He was indicted Thursday. We'll repeat that interview tomorrow night. Monday night, Jeff Gordon and Dale Earnhardt Jr. That should be quite an evening. And right now, speaking of quite an evening, it's always quite an evening when the old clock on the wall -- when the old clock on the wall has reached 10:00 Eastern. That means only one thing. "NEWSNIGHT" and Aaron Brown.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com



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