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CNN Live At Daybreak

More Violence and Hostage Taking in Iraq; Latest Peterson Murder Trial Developments

Aired September 20, 2004 - 06:00   ET

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


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


BETTY NGUYEN, CNN ANCHOR: Good Monday morning.
From the CNN Global Headquarters here in Atlanta, I'm Betty Nguyen in for Carol Costello.

Now in the news -- there is word this morning that President Bush and John Kerry are moving closer to a face-to-face showdown. There are reports the two campaigns have tentatively agreed to a series of three debates. No final deal just yet. Those details are still being worked out.

President Bush could soon lift the remaining sanctions against Libya, and that may mean big money for the relatives of people killed in the bombing of Pan Am Flight 103. The move would clear the way for the release of more than a billion dollars.

The first criminal trial against Enron's former executives kicks off today. The case involves a business deal that happened before the energy company's collapse, but it could shed light on how prosecutors will pursue cases against Enron's higher-ups.

And Haiti is still reeling from tropical storm Jeanne, which hit last week. A U.N. official says the storm killed more than 50 people and left another 150 missing.

Now for the latest on Jeanne, we want to go to Chad Myers.

She's caused some damage -- Chad.

CHAD MYERS, CNN METEOROLOGIST: Yes, exactly. And in fact, two deaths in Puerto Rico and eight in the Dominican Republic, as well. So, obviously those pictures were from Haiti, but you get the idea. It was down there in all of those islands.

(WEATHER REPORT)

NGUYEN: Reports from Iraq this morning tell of dozens of hostages being held. Some of those abductions now confirmed, others unconfirmed.

CNN's Skip Loescher is with us live now from Washington this morning with the details on this and on an Iraqi insurgency that is gaining some momentum.

What do you know -- Skip. SKIP LOESCHER, CNN CORRESPONDENT: Betty, I have some good news for you to start with. And that is that a joint force, Iraqi and U.S. troops, have freed a Jordanian man who was kidnapped last month. Sixteen of his alleged captors were arrested.

(BEGIN VIDEOTAPE)

LOESCHER (voice-over): A suicide bomber killed himself, an Iraqi soldier and an Iraqi civilian at a joint U.S.-Iraqi checkpoint in Samarra in northern Iraq. Four Americans and four Iraqi soldiers were wounded. Near Fallujah, a U.S. Marine tank opened fire on militants trying to set up a defensive position. An Iraqi hospital says three people were killed.

The families of 13 people held hostage in Iraq, including two Americans and a Brit, await the fate of their loved ones.

TY HENSLEY, BROTHER OF HOSTAGE: It's tough. It's just tough.

LOESCHER: The kidnappers are threatening to behead the Americans and the Brit.

HENSLEY: He was no threat and he was not someone that can help further their cause at all.

LOESCHER: Also, a previously unknown Islamic group claims it has kidnapped 15 members of the Iraqi National Guard, offering to trade them for the release of a radical cleric. The Iraqi government hasn't confirmed the kidnapping.

Iraq's interim prime minister was in London Sunday on his way to address the U.N. and the Congress this week. Ayad Allawi says elections will be held in January despite increased violence.

AYAD ALLAWI, IRAQ'S INTERIM PRIME MINISTER: We demand that democracy is going to prevail, it's going to win in Iraq.

LOESCHER: Here at home, House Speaker Dennis Hastert indicated he thinks al Qaeda may have a preference in the forthcoming U.S. presidential election.

REP. DENNIS HASTERT (R-IL), SPEAKER OF THE HOUSE: I think you'll see al Qaeda trying to influence this election.

(END VIDEOTAPE)

LOESCHER: But some Republicans, including Senator John McCain of Arizona, say they do not believe that al Qaeda does have a preference as to who occupies the White House. And Democratic vice presidential nominee John Edwards says Hastert has joined the fear mongering choir -- Betty, back to you.

NGUYEN: Skip, back to those hostages and that deadline today.

Any indication as to whether that deadline may be extended? What do you know about that? LOESCHER: We don't know whether it's going to be extended or not. People are hoping that it will be at this point, because that would leave more time for negotiations to try to get those hostages set free.

NGUYEN: I know their families want them to come home safely.

Skip Loescher, thank you so much for that.

We may hear more from CBS at its controversial Memogate situation. But right now, we want to tell you that in this election season, when the topic is terrorism and the rhetoric is flying thick, here's more about that political dustup Skip Loescher just mentioned.

House Speaker Hastert's claim that al Qaeda would operate better with John Kerry in the White House got the whole thing started. But Kerry's running mate, well, he isn't having it.

(BEGIN VIDEO CLIP)

HASTERT: I think you'll see al Qaeda trying to influence this election. And if they can't influence here, they're going to try to influence it in Iraq. And you'll see, I think, a blitz. I wouldn't be surprised to even see a blitz in Afghanistan, as well.

SEN. JOHN EDWARDS (D-NC), VICE PRESIDENTIAL CANDIDATE: He said, and I'm paraphrasing him now, he said last night something to the effect that al Qaeda wants John Kerry to be president of the United States. Let me just say this in the simplest possible terms. When John Kerry is president of the United States, we will find al Qaeda where they are and crush them before they can do damage to the American people.

(END VIDEO CLIP)

NGUYEN: All right, we may hear more from CBS.

Back to that story about its controversial report on President Bush's military service.

The "Washington Post" says the network plans to put out a statement saying it was "misled" about some purported National Guard memos cites in the report. CBS had said the memos allege Bush got special treatment in the Guard and since then doubts have surfaced about whether the documents are authentic.

Well, the CBS memos will be just one of the political hot topics we discuss in the next half hour of DAYBREAK with the editor of "The Hotline," Vaughn Ververs.

News across America now.

Ivan is still causing trouble in the East. New Jersey and Pennsylvania remain under flood warnings and thousands of people are still waiting to get back into their homes. Disaster areas have been declared in eight states so far. One man died and two other people were injured when a carnival ride came apart at a church fair in Shrewsbury, Massachusetts. All three were residents of a state center for the mentally challenged. Witnesses say they saw one of the victims fly out of the ride. An investigation is under way into the cause of that accident.

Celebrity divorce attorney Marvin Mitchelson is dead after a long battle with cancer. Now, you know him best for the term "palimony," divvying up the assets when two unmarried people call it quits. Ironically, Mitchelson was married to the same woman for 45 years. Marvin Mitchelson was 76 years old.

Prosecutors, well, they could wrap up their case this week in the Scott Peterson double murder trial. Last week, testimony centered on autopsy photos of Peterson's wife and their unborn son.

Just what are attorneys getting at?

Well, legal analyst Kendall Coffey joins us now by phone with the latest on that -- good morning to you, Kendall.

KENDALL COFFEY, CNN LEGAL ANALYST: Hey, good morning.

NGUYEN: Well, Scott Peterson was brought to tears by those photos.

Are we expecting some more emotion in the courtroom today?

COFFEY: Well, I think what the prosecutors counted on was not just the devastating impact of those kind of gruesome photographs, but the way it plays into the ultimate question that's going to be fought out between the prosecution and defense over time of death.

The defense theory is that Conner Peterson was actually born after the time his mother was allegedly abducted on December 24. The photos demonstrate that the condition of Conner Peterson was so much better than that of his mother that it supports the prosecution theory that he was protected inside her body until shortly before he was expelled.

Really heartbreaking, gruesome stuff, but one of the pivotal issues in the prosecution, the question of whether Scott Peterson is guilty of the murder.

NGUYEN: So, how is Geragos expected to attack that, then, that expert testimony?

COFFEY: Well, I think he got one important concession from the prosecution's own expert, who couldn't be absolutely definitive as to whether Conner was born alive. In a case where reasonable doubt could be everything, that's mighty helpful.

Meanwhile, I think, Betty, you're going to be seeing that the defense has its own case. It's going to have its own experts on time of death and everything else. And one of the things the prosecution may be doing in the final days of the trial is trying to anticipate some of the points that the defense will be making when its their turn to put on witnesses and evidence.

NGUYEN: So, Kendall, do you expect the prosecution to wrap up its case this week?

COFFEY: I think they're in the home stretch. Whether it's this week or shortly after, they're going to try to wrap up, bring back some of the strongest points they have in their favor, which will include everything from Scott Peterson's own various lies and deception to the location of the two bodies found where Scott Peterson had been fishing.

And at the same time, I think they're going to try to do some groundwork to prepare for preemptively some of the points the defense will be making.

NGUYEN: Obviously the photos were very difficult for family members to see.

But I want to talk about this ongoing spat behind-the-scenes with the family members.

What's that all about?

COFFEY: Well, you can imagine the bitterness that arise between two sets of parents, parents that at one time loved the son, loved the daughter and now you're dealing with parents -- the parents of Laci believe that Scott Peterson is a murderer. And the parents of Scott Peterson believe that they are pushing a false prosecution against their son.

Parents, you know how all of us are. When it gets to something this high stakes about their own children, the bitterness is inevitable; unfortunate but inevitable.

NGUYEN: All right, Kendall Coffey, thanks so much for that insight this morning.

COFFEY: Thank you.

NGUYEN: Well, cable TV racks up the Emmys. Ahead, the red carpet arrivals and the winners from the 56th Annual Emmy Awards. We have a live report from L.A. in just about five minutes.

And about 25 after, Enron in the hot seat -- how this trial is getting under way and how it could rebuild the shady side of Wall Street.

But first, here's a look at what else is making news on this Monday.

(COMMERCIAL BREAK)

NGUYEN: Time now for your news, money, weather and sports.

It is 6:14 Eastern. Here's what's all new this morning. At least 54 people were killed when tropical storm Jeanne slammed into Haiti. Most of those were killed during severe flooding along the northern coast. Another 150 people are still missing.

Early results in Indonesia may spell the end for the country's current president. Security became the main issue for voters in Indonesia's first direct presidential election. The final results are expected in early October.

Now to money. US Airways might go to court to force union workers to make contract concessions. The "Wall Street Journal" reports the airline is still hoping to reach agreement on other cost cutting measures with the unions. US Airways filed for bankruptcy for the second time last week.

In culture, HBO and "Angels" were the big winners at last night's prime time Emmy Awards. The network won a total of, get this, 32 awards. A record 11 statues went to the HBO miniseries "Angels In America." We go live to Los Angeles straight ahead for more on those Emmys.

But first, a little sports, golf, to be exact. The United States suffered its worst defeat ever in Ryder Cup history. The team of 12 Europeans thrashed the Americans, winning 18 1/2 to just 9 1/2. Europe has won four of the last five Ryder Cup tournaments.

I don't guess you can blame that on the weather, can you -- Chad.

MYERS: No, it was perfect up there in Michigan. In fact, I've actually played that golf course. I was talking to our HEADLINE NEWS weather guy here, Gaelin Crater (ph). He said that the U.S. actually had a chance to come back during that. It made it a little exciting, but, boy, the final score just doesn't show that, does it?

(WEATHER REPORT)

NGUYEN: All right, now we want to go to the highlights of last night's Emmy Awards in case you went to sleep and you didn't get to watch them, like I didn't get to see them. For some, the night was a final farewell. But for others, it was more of a coming out party.

And to wrap it all up, we want to go to Shrine Auditorium and CNN's Kimberly Osias.

(BEGIN VIDEOTAPE)

KIMBERLY OSIAS, CNN CORRESPONDENT (voice-over): It was a night of angels and gangster. The unseemly bedfellows raked in the gold statuettes. From the silver screen to the TV screen, this was the year of crossover.

MERYL STREEP, BEST ACTRESS: There are some days when I myself think I'm over rated. But not today.

OSIAS: After five years, the HBO hit "The Sopranos" took home the best drama honor. But Tony Soprano was silenced, this time by an Academy destined to finish the act on time.

JAMES GANDOLFINI, "THE SOPRANOS": Wait, wait, wait, wait, wait, wait, wait, wait, wait.

OSIAS: Time ran out for hit series, "Sex and the City." But for two of the fab four gals, Cynthia Nixon and Sarah Jessica Parker, some wins to walk with.

SARAH JESSICA PARKER, BEST ACTRESS IN COMEDY: This is great punctuation for the end of a long sentence, and I mean a really good sentence. And really well worth the wait and the glorious finish to what was the journey of a lifetime.

OSIAS: The audience said good-bye to Dr. Frasier Crane his year, too. The victory is bittersweet for David Hyde Pierce and Kelsey Grammer.

KELSEY GRAMMER, BEST ACTOR IN A COMEDY: I had the most extraordinary life on television. "Frasier" was a gift in my life and the people that I got to meet and work with were the greatest gift. And this is just the cherry on top.

OSIAS: Dark horse "Arrested Development" was the night's biggest surprise, taking best comedy honors.

UNIDENTIFIED MALE: Just look at him.

(END VIDEOTAPE)

OSIAS: And for the first time, the reality show genre graduated to full Emmy status. Winning there was "The Amazing Race" -- Betty.

NGUYEN: You know, a lot of people watching last night were looking for some of these big surprises.

Anything like that happen?

OSIAS: Well, I mean, you know, the surprise, of course, was "The Amazing Race." I mean winning and also "Arrested Development," freshman effort there. Critics loved it, but it was really not the fave with the viewers. So, hopefully now more people will tune in and watch.

NGUYEN: Yes, I think a lot of people were surprised when they kept wracking up on the statues.

All right, any awkward moments?

OSIAS: I'm sorry, what was that?

NGUYEN: Awkward moments. There's always got to be a few at these award events.

OSIAS: You know, I think the awkward moment was "Sex and the City" actor Chris Noth and Sarah Jessica Parker. You know, they were a couple and everybody wondered if they would get married on the show and it ended up. But then he actually proposed to her. And being live, it was a little bit awkward. And she, of course, is married to Matthew Broderick. And paused and said, "No."

NGUYEN: Yes, I don't think that really worked. I saw that. It didn't work all that well on that format. Maybe on the show, but not there.

All right, Kimberly Osias, thank you so much.

OSIAS: That's right.

NGUYEN: Now for more of the Emmy highlights, let's turn now to Tom O'Neil and "In Touch" magazine, who joins us now from Los Angeles.

Have you gone to sleep at all?

TOM O'NEIL, EDITOR, "IN TOUCH WEEKLY": For about 45 minutes.

NGUYEN: You've been to all the parties.

How were the parties, by the way?

O'NEIL: Well, the cool one to go to was the HBO party. And "TV Guide" partnered with "Access Hollywood" to put up tents across the street. And HBO was so upset, they put up all this garbage-y, literally garbage plastic as their insult to keep the overflow from that party out. It was war over the parties. It was hysterical. And the "TV Guide" people were spilling across the street to come to the HBO one.

NGUYEN: Really kind of catty there.

I mean were some start not able to get into all the different parties, because they don't like when that happens?

O'NEIL: No, they don't. And they didn't have enough invitations for those two parties, no. And I heard a lot of screaming back at the Shrine Auditorium, where the governor's ball was, because a lot of those guys wanted in to the other parties.

NGUYEN: Not good.

All right, let's talk about the winners. You know, "Sex and the City," a lot of people were pulling for them. Two winners last night from that show.

O'NEIL: Two winners. And let me take credit personally for one of those victories.

NGUYEN: OK.

Why is that, Tom?

O'NEIL: Honest to god, goldderby.com, my Web site, has been telling those girls for years the reason you're not winning is you're picking the wrong episodes to give the Emmy judges. So, backstage, as I came around the corner, Cynthia Nixon was telling "Entertainment Tonight" that she owed it all to Gold Derby because this year she listened to them and didn't submit comedic episodes. And then she turned to me and had a whole room full of witnesses and cameras on her, where she said, "I owe it all to Gold Derby."

NGUYEN: Let me ask you this. I was watching that portion and it almost seemed like Kim Cattrall may have thought that this is my night. And then Cynthia Nixon won and she was totally surprised.

O'NEIL: Yes. I think a lot of us were. Kim Cattrall had that story line of the cancer, which was much more gripping, but it was a big -- I watch the tapes every year and we were all -- those of us who do watch them were delightfully surprised at what an impact Cynthia has had. So, we knew it was close. But since Cattrall is more of a flashy character and had the breast cancer story line, it seemed more logical that she would win.

NGUYEN: And you talk about flash, we can't leave you without talking about fashion. Who were the fashion dos and, of course, we've got to talk about the fashion don'ts, too.

O'NEIL: You are asking the wrong person, Betty.

NGUYEN: Really? Come on, Tom. You've go to have some kind of opinion.

O'NEIL: There I was in my Today's Man tuxedo. I'm not the right guy. You know, I really am so unaware of that.

NGUYEN: You didn't hear any talk at these parties when you were mingling with all the stars?

O'NEIL: Well, Kim Cattrall sure looked pretty foxy. But if that dress was any tighter, I don't know, I think she would have popped right out of it.

NGUYEN: Maybe that's the point, there.

All right, Tom O'Neil, "In Touch Weekly," thanks so much for that.

O'NEIL: Thanks, Betty.

NGUYEN: Well, DAYBREAK will be right back.

But first, more scenes from those Emmys.

(COMMERCIAL BREAK)

NGUYEN: The international markets are starting the week off in negative territory.

Tokyo's Nikkei is down nearly 57 points.

The London market is trading down, as well, around 11 points.

And you guessed it, in Paris, the market is also down, 17 1/2 points.

Well, should local governments be allowed to take someone's home for purposes of redevelopment to boost a city's lagging economy? In New London, Connecticut, seven homeowners say they're not leaving without a fight and their case may go to the U.S. Supreme Court, as CNN's Alina Cho reports.

(BEGIN VIDEOTAPE)

ALINA CHO, CNN CORRESPONDENT (voice-over): When Susette Kelo move into her charming home in New London, Connecticut seven years ago...

SUSETTE KELO, NEW LONDON RESIDENT: It was like I'd been here all my life. It was just, it was just a warm and inviting feeling.

CHO: A little slice of heaven on the water, the best house she could find for her money. Seven months after moving in, though, Kelo was told she had to move out.

KELO: I was thinking I had a really big problem.

CHO: She learned the City of New London wanted to buy her home, tear it down and then redevelop the land. Connecticut's highest court agreed with the city, citing a statute called eminent domain, which allows local governments to confiscate private property for public use.

TOM LONDREGAN, CITY ATTORNEY: Whether it be an office park, whether it be retail, whether it be some housing, all these potential uses are there in the plans.

CHO: City Attorney Tom Londregan says that kind of development would give New London a big economic boost.

That is not how Matt Dery sees it.

MATT DERY, NEW LONDON RESIDENT: The property went to my father and now it's come full circle to me.

CHO: Dery's family has owned property here for more than a century. It is where he grew up, where he now shares a home with his wife. The Derys called this a seven year nightmare that has even affected decisions like painting their house.

M. DERY: We went like two years and we said, you know, the heck with this. And we had the house painted. But we only put one coat on it because...

SUZANNE DERY, NEW LONDON RESIDENT: Because we never...

M. DERY: No, we don't know if we're going to be here or not.

S. DERY: We've been living a life of...

M. DERY: And we...

S. DERY: ... not knowing.

M. DERY: Yes.

CHO: Ninety other homeowners have taken the city's offer to sell their homes at market value, but seven, including the Derys and Kelo, say they won't walk away without a fight.

KELO: I don't think walk will be the word. They'll have to drag me.

CHO: The U.S. Supreme Court will decide next month whether to hear the case.

Alina Cho, CNN, New London, Connecticut.

(END VIDEOTAPE)

NGUYEN: We'll continue watching for that one.

In the meantime, political mud slinging, it continues. Ahead in our political hot topics segment, al Qaeda and the presidential elections, the CBS memos and dissecting a new John Kerry ad.

DAYBREAK will be right back after this.

(COMMERCIAL BREAK)

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Aired September 20, 2004 - 06:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BETTY NGUYEN, CNN ANCHOR: Good Monday morning.
From the CNN Global Headquarters here in Atlanta, I'm Betty Nguyen in for Carol Costello.

Now in the news -- there is word this morning that President Bush and John Kerry are moving closer to a face-to-face showdown. There are reports the two campaigns have tentatively agreed to a series of three debates. No final deal just yet. Those details are still being worked out.

President Bush could soon lift the remaining sanctions against Libya, and that may mean big money for the relatives of people killed in the bombing of Pan Am Flight 103. The move would clear the way for the release of more than a billion dollars.

The first criminal trial against Enron's former executives kicks off today. The case involves a business deal that happened before the energy company's collapse, but it could shed light on how prosecutors will pursue cases against Enron's higher-ups.

And Haiti is still reeling from tropical storm Jeanne, which hit last week. A U.N. official says the storm killed more than 50 people and left another 150 missing.

Now for the latest on Jeanne, we want to go to Chad Myers.

She's caused some damage -- Chad.

CHAD MYERS, CNN METEOROLOGIST: Yes, exactly. And in fact, two deaths in Puerto Rico and eight in the Dominican Republic, as well. So, obviously those pictures were from Haiti, but you get the idea. It was down there in all of those islands.

(WEATHER REPORT)

NGUYEN: Reports from Iraq this morning tell of dozens of hostages being held. Some of those abductions now confirmed, others unconfirmed.

CNN's Skip Loescher is with us live now from Washington this morning with the details on this and on an Iraqi insurgency that is gaining some momentum.

What do you know -- Skip. SKIP LOESCHER, CNN CORRESPONDENT: Betty, I have some good news for you to start with. And that is that a joint force, Iraqi and U.S. troops, have freed a Jordanian man who was kidnapped last month. Sixteen of his alleged captors were arrested.

(BEGIN VIDEOTAPE)

LOESCHER (voice-over): A suicide bomber killed himself, an Iraqi soldier and an Iraqi civilian at a joint U.S.-Iraqi checkpoint in Samarra in northern Iraq. Four Americans and four Iraqi soldiers were wounded. Near Fallujah, a U.S. Marine tank opened fire on militants trying to set up a defensive position. An Iraqi hospital says three people were killed.

The families of 13 people held hostage in Iraq, including two Americans and a Brit, await the fate of their loved ones.

TY HENSLEY, BROTHER OF HOSTAGE: It's tough. It's just tough.

LOESCHER: The kidnappers are threatening to behead the Americans and the Brit.

HENSLEY: He was no threat and he was not someone that can help further their cause at all.

LOESCHER: Also, a previously unknown Islamic group claims it has kidnapped 15 members of the Iraqi National Guard, offering to trade them for the release of a radical cleric. The Iraqi government hasn't confirmed the kidnapping.

Iraq's interim prime minister was in London Sunday on his way to address the U.N. and the Congress this week. Ayad Allawi says elections will be held in January despite increased violence.

AYAD ALLAWI, IRAQ'S INTERIM PRIME MINISTER: We demand that democracy is going to prevail, it's going to win in Iraq.

LOESCHER: Here at home, House Speaker Dennis Hastert indicated he thinks al Qaeda may have a preference in the forthcoming U.S. presidential election.

REP. DENNIS HASTERT (R-IL), SPEAKER OF THE HOUSE: I think you'll see al Qaeda trying to influence this election.

(END VIDEOTAPE)

LOESCHER: But some Republicans, including Senator John McCain of Arizona, say they do not believe that al Qaeda does have a preference as to who occupies the White House. And Democratic vice presidential nominee John Edwards says Hastert has joined the fear mongering choir -- Betty, back to you.

NGUYEN: Skip, back to those hostages and that deadline today.

Any indication as to whether that deadline may be extended? What do you know about that? LOESCHER: We don't know whether it's going to be extended or not. People are hoping that it will be at this point, because that would leave more time for negotiations to try to get those hostages set free.

NGUYEN: I know their families want them to come home safely.

Skip Loescher, thank you so much for that.

We may hear more from CBS at its controversial Memogate situation. But right now, we want to tell you that in this election season, when the topic is terrorism and the rhetoric is flying thick, here's more about that political dustup Skip Loescher just mentioned.

House Speaker Hastert's claim that al Qaeda would operate better with John Kerry in the White House got the whole thing started. But Kerry's running mate, well, he isn't having it.

(BEGIN VIDEO CLIP)

HASTERT: I think you'll see al Qaeda trying to influence this election. And if they can't influence here, they're going to try to influence it in Iraq. And you'll see, I think, a blitz. I wouldn't be surprised to even see a blitz in Afghanistan, as well.

SEN. JOHN EDWARDS (D-NC), VICE PRESIDENTIAL CANDIDATE: He said, and I'm paraphrasing him now, he said last night something to the effect that al Qaeda wants John Kerry to be president of the United States. Let me just say this in the simplest possible terms. When John Kerry is president of the United States, we will find al Qaeda where they are and crush them before they can do damage to the American people.

(END VIDEO CLIP)

NGUYEN: All right, we may hear more from CBS.

Back to that story about its controversial report on President Bush's military service.

The "Washington Post" says the network plans to put out a statement saying it was "misled" about some purported National Guard memos cites in the report. CBS had said the memos allege Bush got special treatment in the Guard and since then doubts have surfaced about whether the documents are authentic.

Well, the CBS memos will be just one of the political hot topics we discuss in the next half hour of DAYBREAK with the editor of "The Hotline," Vaughn Ververs.

News across America now.

Ivan is still causing trouble in the East. New Jersey and Pennsylvania remain under flood warnings and thousands of people are still waiting to get back into their homes. Disaster areas have been declared in eight states so far. One man died and two other people were injured when a carnival ride came apart at a church fair in Shrewsbury, Massachusetts. All three were residents of a state center for the mentally challenged. Witnesses say they saw one of the victims fly out of the ride. An investigation is under way into the cause of that accident.

Celebrity divorce attorney Marvin Mitchelson is dead after a long battle with cancer. Now, you know him best for the term "palimony," divvying up the assets when two unmarried people call it quits. Ironically, Mitchelson was married to the same woman for 45 years. Marvin Mitchelson was 76 years old.

Prosecutors, well, they could wrap up their case this week in the Scott Peterson double murder trial. Last week, testimony centered on autopsy photos of Peterson's wife and their unborn son.

Just what are attorneys getting at?

Well, legal analyst Kendall Coffey joins us now by phone with the latest on that -- good morning to you, Kendall.

KENDALL COFFEY, CNN LEGAL ANALYST: Hey, good morning.

NGUYEN: Well, Scott Peterson was brought to tears by those photos.

Are we expecting some more emotion in the courtroom today?

COFFEY: Well, I think what the prosecutors counted on was not just the devastating impact of those kind of gruesome photographs, but the way it plays into the ultimate question that's going to be fought out between the prosecution and defense over time of death.

The defense theory is that Conner Peterson was actually born after the time his mother was allegedly abducted on December 24. The photos demonstrate that the condition of Conner Peterson was so much better than that of his mother that it supports the prosecution theory that he was protected inside her body until shortly before he was expelled.

Really heartbreaking, gruesome stuff, but one of the pivotal issues in the prosecution, the question of whether Scott Peterson is guilty of the murder.

NGUYEN: So, how is Geragos expected to attack that, then, that expert testimony?

COFFEY: Well, I think he got one important concession from the prosecution's own expert, who couldn't be absolutely definitive as to whether Conner was born alive. In a case where reasonable doubt could be everything, that's mighty helpful.

Meanwhile, I think, Betty, you're going to be seeing that the defense has its own case. It's going to have its own experts on time of death and everything else. And one of the things the prosecution may be doing in the final days of the trial is trying to anticipate some of the points that the defense will be making when its their turn to put on witnesses and evidence.

NGUYEN: So, Kendall, do you expect the prosecution to wrap up its case this week?

COFFEY: I think they're in the home stretch. Whether it's this week or shortly after, they're going to try to wrap up, bring back some of the strongest points they have in their favor, which will include everything from Scott Peterson's own various lies and deception to the location of the two bodies found where Scott Peterson had been fishing.

And at the same time, I think they're going to try to do some groundwork to prepare for preemptively some of the points the defense will be making.

NGUYEN: Obviously the photos were very difficult for family members to see.

But I want to talk about this ongoing spat behind-the-scenes with the family members.

What's that all about?

COFFEY: Well, you can imagine the bitterness that arise between two sets of parents, parents that at one time loved the son, loved the daughter and now you're dealing with parents -- the parents of Laci believe that Scott Peterson is a murderer. And the parents of Scott Peterson believe that they are pushing a false prosecution against their son.

Parents, you know how all of us are. When it gets to something this high stakes about their own children, the bitterness is inevitable; unfortunate but inevitable.

NGUYEN: All right, Kendall Coffey, thanks so much for that insight this morning.

COFFEY: Thank you.

NGUYEN: Well, cable TV racks up the Emmys. Ahead, the red carpet arrivals and the winners from the 56th Annual Emmy Awards. We have a live report from L.A. in just about five minutes.

And about 25 after, Enron in the hot seat -- how this trial is getting under way and how it could rebuild the shady side of Wall Street.

But first, here's a look at what else is making news on this Monday.

(COMMERCIAL BREAK)

NGUYEN: Time now for your news, money, weather and sports.

It is 6:14 Eastern. Here's what's all new this morning. At least 54 people were killed when tropical storm Jeanne slammed into Haiti. Most of those were killed during severe flooding along the northern coast. Another 150 people are still missing.

Early results in Indonesia may spell the end for the country's current president. Security became the main issue for voters in Indonesia's first direct presidential election. The final results are expected in early October.

Now to money. US Airways might go to court to force union workers to make contract concessions. The "Wall Street Journal" reports the airline is still hoping to reach agreement on other cost cutting measures with the unions. US Airways filed for bankruptcy for the second time last week.

In culture, HBO and "Angels" were the big winners at last night's prime time Emmy Awards. The network won a total of, get this, 32 awards. A record 11 statues went to the HBO miniseries "Angels In America." We go live to Los Angeles straight ahead for more on those Emmys.

But first, a little sports, golf, to be exact. The United States suffered its worst defeat ever in Ryder Cup history. The team of 12 Europeans thrashed the Americans, winning 18 1/2 to just 9 1/2. Europe has won four of the last five Ryder Cup tournaments.

I don't guess you can blame that on the weather, can you -- Chad.

MYERS: No, it was perfect up there in Michigan. In fact, I've actually played that golf course. I was talking to our HEADLINE NEWS weather guy here, Gaelin Crater (ph). He said that the U.S. actually had a chance to come back during that. It made it a little exciting, but, boy, the final score just doesn't show that, does it?

(WEATHER REPORT)

NGUYEN: All right, now we want to go to the highlights of last night's Emmy Awards in case you went to sleep and you didn't get to watch them, like I didn't get to see them. For some, the night was a final farewell. But for others, it was more of a coming out party.

And to wrap it all up, we want to go to Shrine Auditorium and CNN's Kimberly Osias.

(BEGIN VIDEOTAPE)

KIMBERLY OSIAS, CNN CORRESPONDENT (voice-over): It was a night of angels and gangster. The unseemly bedfellows raked in the gold statuettes. From the silver screen to the TV screen, this was the year of crossover.

MERYL STREEP, BEST ACTRESS: There are some days when I myself think I'm over rated. But not today.

OSIAS: After five years, the HBO hit "The Sopranos" took home the best drama honor. But Tony Soprano was silenced, this time by an Academy destined to finish the act on time.

JAMES GANDOLFINI, "THE SOPRANOS": Wait, wait, wait, wait, wait, wait, wait, wait, wait.

OSIAS: Time ran out for hit series, "Sex and the City." But for two of the fab four gals, Cynthia Nixon and Sarah Jessica Parker, some wins to walk with.

SARAH JESSICA PARKER, BEST ACTRESS IN COMEDY: This is great punctuation for the end of a long sentence, and I mean a really good sentence. And really well worth the wait and the glorious finish to what was the journey of a lifetime.

OSIAS: The audience said good-bye to Dr. Frasier Crane his year, too. The victory is bittersweet for David Hyde Pierce and Kelsey Grammer.

KELSEY GRAMMER, BEST ACTOR IN A COMEDY: I had the most extraordinary life on television. "Frasier" was a gift in my life and the people that I got to meet and work with were the greatest gift. And this is just the cherry on top.

OSIAS: Dark horse "Arrested Development" was the night's biggest surprise, taking best comedy honors.

UNIDENTIFIED MALE: Just look at him.

(END VIDEOTAPE)

OSIAS: And for the first time, the reality show genre graduated to full Emmy status. Winning there was "The Amazing Race" -- Betty.

NGUYEN: You know, a lot of people watching last night were looking for some of these big surprises.

Anything like that happen?

OSIAS: Well, I mean, you know, the surprise, of course, was "The Amazing Race." I mean winning and also "Arrested Development," freshman effort there. Critics loved it, but it was really not the fave with the viewers. So, hopefully now more people will tune in and watch.

NGUYEN: Yes, I think a lot of people were surprised when they kept wracking up on the statues.

All right, any awkward moments?

OSIAS: I'm sorry, what was that?

NGUYEN: Awkward moments. There's always got to be a few at these award events.

OSIAS: You know, I think the awkward moment was "Sex and the City" actor Chris Noth and Sarah Jessica Parker. You know, they were a couple and everybody wondered if they would get married on the show and it ended up. But then he actually proposed to her. And being live, it was a little bit awkward. And she, of course, is married to Matthew Broderick. And paused and said, "No."

NGUYEN: Yes, I don't think that really worked. I saw that. It didn't work all that well on that format. Maybe on the show, but not there.

All right, Kimberly Osias, thank you so much.

OSIAS: That's right.

NGUYEN: Now for more of the Emmy highlights, let's turn now to Tom O'Neil and "In Touch" magazine, who joins us now from Los Angeles.

Have you gone to sleep at all?

TOM O'NEIL, EDITOR, "IN TOUCH WEEKLY": For about 45 minutes.

NGUYEN: You've been to all the parties.

How were the parties, by the way?

O'NEIL: Well, the cool one to go to was the HBO party. And "TV Guide" partnered with "Access Hollywood" to put up tents across the street. And HBO was so upset, they put up all this garbage-y, literally garbage plastic as their insult to keep the overflow from that party out. It was war over the parties. It was hysterical. And the "TV Guide" people were spilling across the street to come to the HBO one.

NGUYEN: Really kind of catty there.

I mean were some start not able to get into all the different parties, because they don't like when that happens?

O'NEIL: No, they don't. And they didn't have enough invitations for those two parties, no. And I heard a lot of screaming back at the Shrine Auditorium, where the governor's ball was, because a lot of those guys wanted in to the other parties.

NGUYEN: Not good.

All right, let's talk about the winners. You know, "Sex and the City," a lot of people were pulling for them. Two winners last night from that show.

O'NEIL: Two winners. And let me take credit personally for one of those victories.

NGUYEN: OK.

Why is that, Tom?

O'NEIL: Honest to god, goldderby.com, my Web site, has been telling those girls for years the reason you're not winning is you're picking the wrong episodes to give the Emmy judges. So, backstage, as I came around the corner, Cynthia Nixon was telling "Entertainment Tonight" that she owed it all to Gold Derby because this year she listened to them and didn't submit comedic episodes. And then she turned to me and had a whole room full of witnesses and cameras on her, where she said, "I owe it all to Gold Derby."

NGUYEN: Let me ask you this. I was watching that portion and it almost seemed like Kim Cattrall may have thought that this is my night. And then Cynthia Nixon won and she was totally surprised.

O'NEIL: Yes. I think a lot of us were. Kim Cattrall had that story line of the cancer, which was much more gripping, but it was a big -- I watch the tapes every year and we were all -- those of us who do watch them were delightfully surprised at what an impact Cynthia has had. So, we knew it was close. But since Cattrall is more of a flashy character and had the breast cancer story line, it seemed more logical that she would win.

NGUYEN: And you talk about flash, we can't leave you without talking about fashion. Who were the fashion dos and, of course, we've got to talk about the fashion don'ts, too.

O'NEIL: You are asking the wrong person, Betty.

NGUYEN: Really? Come on, Tom. You've go to have some kind of opinion.

O'NEIL: There I was in my Today's Man tuxedo. I'm not the right guy. You know, I really am so unaware of that.

NGUYEN: You didn't hear any talk at these parties when you were mingling with all the stars?

O'NEIL: Well, Kim Cattrall sure looked pretty foxy. But if that dress was any tighter, I don't know, I think she would have popped right out of it.

NGUYEN: Maybe that's the point, there.

All right, Tom O'Neil, "In Touch Weekly," thanks so much for that.

O'NEIL: Thanks, Betty.

NGUYEN: Well, DAYBREAK will be right back.

But first, more scenes from those Emmys.

(COMMERCIAL BREAK)

NGUYEN: The international markets are starting the week off in negative territory.

Tokyo's Nikkei is down nearly 57 points.

The London market is trading down, as well, around 11 points.

And you guessed it, in Paris, the market is also down, 17 1/2 points.

Well, should local governments be allowed to take someone's home for purposes of redevelopment to boost a city's lagging economy? In New London, Connecticut, seven homeowners say they're not leaving without a fight and their case may go to the U.S. Supreme Court, as CNN's Alina Cho reports.

(BEGIN VIDEOTAPE)

ALINA CHO, CNN CORRESPONDENT (voice-over): When Susette Kelo move into her charming home in New London, Connecticut seven years ago...

SUSETTE KELO, NEW LONDON RESIDENT: It was like I'd been here all my life. It was just, it was just a warm and inviting feeling.

CHO: A little slice of heaven on the water, the best house she could find for her money. Seven months after moving in, though, Kelo was told she had to move out.

KELO: I was thinking I had a really big problem.

CHO: She learned the City of New London wanted to buy her home, tear it down and then redevelop the land. Connecticut's highest court agreed with the city, citing a statute called eminent domain, which allows local governments to confiscate private property for public use.

TOM LONDREGAN, CITY ATTORNEY: Whether it be an office park, whether it be retail, whether it be some housing, all these potential uses are there in the plans.

CHO: City Attorney Tom Londregan says that kind of development would give New London a big economic boost.

That is not how Matt Dery sees it.

MATT DERY, NEW LONDON RESIDENT: The property went to my father and now it's come full circle to me.

CHO: Dery's family has owned property here for more than a century. It is where he grew up, where he now shares a home with his wife. The Derys called this a seven year nightmare that has even affected decisions like painting their house.

M. DERY: We went like two years and we said, you know, the heck with this. And we had the house painted. But we only put one coat on it because...

SUZANNE DERY, NEW LONDON RESIDENT: Because we never...

M. DERY: No, we don't know if we're going to be here or not.

S. DERY: We've been living a life of...

M. DERY: And we...

S. DERY: ... not knowing.

M. DERY: Yes.

CHO: Ninety other homeowners have taken the city's offer to sell their homes at market value, but seven, including the Derys and Kelo, say they won't walk away without a fight.

KELO: I don't think walk will be the word. They'll have to drag me.

CHO: The U.S. Supreme Court will decide next month whether to hear the case.

Alina Cho, CNN, New London, Connecticut.

(END VIDEOTAPE)

NGUYEN: We'll continue watching for that one.

In the meantime, political mud slinging, it continues. Ahead in our political hot topics segment, al Qaeda and the presidential elections, the CBS memos and dissecting a new John Kerry ad.

DAYBREAK will be right back after this.

(COMMERCIAL BREAK)

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