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NANCY GRACE

Nancy Grace for June 28, 2005, CNNHN

Aired June 28, 2005 - 20:00:00   ET

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


NANCY GRACE, HOST: Tonight, the family of 18-year-old Natalee Holloway, who vanished from her high school senior trip to Aruba, stunned and shocked by Aruban Judge Paul Van Der Sloot`s release from jail. Natalee`s mother convinced this judge is hiding information about her girl`s disappearance.
And remember Shasta and Dylan Groene, just 8- and 9-years-old? They went missing from their Idaho home weeks ago. Everybody else in the home bludgeoned to death, the two children disappear without a trace. Tonight, as the holiday approaches, their aunt doesn`t want us to forget Dylan and Shasta.

And one of the most notorious serial killers in history. Next week, half of the so-called Barbie and Ken killers becomes a free woman. That`s right. Karla Homolka gets out of jail free, free after just a few years behind bars for serial murder. Is that justice?

Good evening, everybody. I`m Nancy Grace. And I want to thank you for being with us tonight.

The aunt of 8- and 9-year-old Shasta and Dylan Groene, both missing from their Idaho home after their mother and brother`s murder, begs you to continue the search over the July 4th holiday.

And tonight, Karla Homolka and her husband were dubbed the Barbie and Ken Killers because of their extreme good looks. They terrorized their community by kidnapping, raping and murdering numerous young girls and putting it on video, including Homolka`s own little sister. Well, buckle your seatbelt: Next week, she is a free woman.

And the search rages on tonight for 18-year-old Alabama beauty Natalee Holloway. Holloway`s mom convinced this Aruban judge, Van Der Sloot, has the answers.

Tonight, Natalee`s stepmother is joining us, Robin Holloway. In Aruba, defense attorney John Zara will be with us; in San Francisco, defense attorney Daniel Horowitz and defense attorney Paula Canny; in New York, clinical psychologist Dr. Patricia Saunders.

But first, let`s go down to Aruba and CNN correspondent Karl Penhaul. Karl, tell me about the search today.

KARL PENHAUL, CNN CORRESPONDENT: Well, the search went on in two areas today, behind the McDonalds take-out here in the north of the island and also up in the area of the sand dunes.

Of course, you`ll remember that we`re now in the fifth week of the search for Natalee. And we used that occasion to go back and try to trace, along with some of the defense attorneys, what the latest story of the three suspects still in custody is.

We talked to the attorney for Satish Kalpoe. And he`s also access to the statements made by Deepak Kalpoe and Joran Van Der Sloot, as well.

The latest timeline that we can put together, Nancy, is this, that Satish and Deepak Kalpoe say that they dropped Joran Van Der Sloot and Natalee off at the beach near the Marriott Hotel around 1:50 a.m. And then, Joran says that he stayed until about 2:30 at the beach with Natalee and after that, he left.

And there is also cell phone records to this. And there was a cell phone record about a call about 2:30, about 2:40, and this is what Satish Kalpoe`s attorney had to say about that phone call.

(BEGIN VIDEO CLIP)

DAVID KOCK, SATISH KALPOE`S ATTORNEY: The story of Deepak is that Joran just said, "I`m walking home. I was on the beach with a girl, but she fell asleep, didn`t want to get up, so I said, `Forget it, I`m walking home.`" He said that we know, about 40 minutes later, 45 minutes later, there`s an SMS message from Joran to Deepak again saying, "I got home," you know, "thanks for waiting."

(END VIDEO CLIP)

PENHAUL: Now what we did to try to test that out was walk from the Marriott beach to Joran Van Der Sloot`s front gate down the route that he would have taken, as well, and through one or two shortcuts in his neighborhood. It took us 36 minutes. And all this timed by cell phone records that have been seized by the police and are now being presented as part of the evidence, Nancy.

GRACE: OK. OK.

Daniel Horowitz, something stinks. Why would a teenager call another teenager and say, "Hi. I`m leaving the beach now." And then, in 20 minutes, "Hi, just want to check in, want to you know I`m home. I left the girl on the beach. I`m not with her anymore," Daniel?

HOROWITZ: Nancy, it`s just another nonsensical story by this young man who clearly killed Natalee Holloway. We know he did it. We know his dad knows that he did it. Otherwise, he and his dad would have been searching for her with desperation.

This is the most nonsensical story he could make up. No young man leaves a young woman of that age at the beach alone, number one. Number two, he`s changed his story. Time to pressure him. No U.S. citizen should book any vacation in Aruba until they squeeze that young man, find Natalee, and bring her home.

GRACE: Take a listen to this.

(BEGIN VIDEO CLIP)

BETH HOLLOWAY TWITTY, MOTHER OF NATALEE HOLLOWAY: I was devastated. I felt like we worked so hard for a month. I mean, you know, we were here at 11:00 p.m. on the 30th and we worked so hard where we were. And I can`t believe that it was ripped away from me. I don`t know. Am I back at square one?

(END VIDEO CLIP)

GRACE: Joining us now by phone, Natalee`s stepmom, Robin Holloway. Thank you for being with us, Ms. Holloway. What was your response when this judge was released from custody?

ROBIN HOLLOWAY, NATALEE`S STEPMOTHER: It is unbelievable, Nancy. I hope that they have something that they`re working on behind closed doors, because I am just devastated that they let him go. In my opinion, he was sweating too much, too fidgety. I mean, he knows something, in my opinion. I mean, I was not there. I just can`t believe they let him go.

GRACE: You know, it seemed to me, to Karl Penhaul, CNN correspondent, it seemed to me that the judge being taken into custody was highly significant. In retrospect, Karl Penhaul, do you think this judge knows more about the actual disappearance, or did they arrest him just to pressure his son to crack?

PENHAUL: There was speculation initially, Nancy, that he had been arrested to pressure his son somewhat. There was also behind-the-scene speculation, as well, that he may actually have known something more than he was letting on.

But the judge who was brought from Curacao in to review this case, to keep a handle on it, to try and ensure some kind of impartiality, looked at the evidence that was presented to him and said, "I can`t see anything on paper, any good reason to continue holding this guy." That`s why they`ve let him go.

GRACE: Take a listen to this, Karl.

(BEGIN VIDEO CLIP)

BETH HOLLOWAY TWITTY, MOTHER OF NATALEE HOLLOWAY: That night and the early morning hours on the 31st, we knew that he was instrumental, had some connection, some information he was withholding.

And once I spent that 90 minutes in his home, I had the confirmation that I needed to know, yes, yes, he does have some information. I don`t know what he has. I don`t know how he`s involved, but he can help give us some information on this.

(END VIDEO CLIP)

GRACE: That`s Natalee`s mother. She told me she was stunned when the judge was released from jail. We`ll be back live in Aruba live with Karl Penhaul. Please stay with us.

(BEGIN VIDEO CLIP)

BETH HOLLOWAY TWITTY, MOTHER OF NATALEE HOLLOWAY: I feel like that I have carried this and it`s June 13. You know, I really felt like we were pushing forward, and we`re working together.

And you know, after this weekend, when it`s ripped out from me, you know, I don`t know. Maybe I need a chart. You know, I would love to know where I am. I don`t know if I`m at the beginning. I don`t know if I`m in the middle. You know, I don`t think any of us know where we are anymore.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

KARL PENHAUL, CNN CORRESPONDENT (voice-over): It`s been 28 days, a full lunar cycle, since Natalee vanished. The moon above me now would have been exactly the same that night. It`s bright enough to cast my shadow on the sand. It could have been romantic, if something had not gone terribly wrong.

(END VIDEO CLIP)

GRACE: Welcome back, everybody. I`m Nancy Grace. Thank you for being with us.

Straight down to Karl Penhaul in Aruba. Tell me about the Dutch marines. It seems to me that they are waiting to join in the search.

PENHAUL: The Dutch marines all along, Nancy, have been participating in this search as and when required. You`ll remember right on early on in this search we saw them beating through mangrove swamps and bushes down on the eastern end of the island.

It was them who found that blood-stained mattress. The blood turned out to be dog blood. But the Dutch marines have a base on the island here. And as and when they`re needed, they`re called on and drawn into that, the same as the police and the Aruban search-and-rescue teams, as well, Nancy.

GRACE: Joining us now, Aruban defense attorney, John Zara. He is also there in Aruba.

John, welcome. Question to you, why hasn`t the government released more details regarding Natalee`s disappearance? What evidence do they have?

JOHN ZARA, DEFENSE ATTORNEY IN ARUBA: Good evening, Ms. Grace. Your question is, why didn`t they let more evidence (UNINTELLIGIBLE)

GRACE: Why have they not released more evidence?

ZARA: You see, in our system in Aruba, it`s not a matter -- it`s not an obligation for a public minister to leave evidence go. You see, they do their job, and of course, there is -- once a week, they do give a report. But it`s not an obligation for them to be releasing...

GRACE: Information.

ZARA: ... information just like that.

GRACE: OK, very quickly to Paula Canny, defense attorney. Could American authorities -- is there any way that we could step in and help the investigation, Paula?

PAULA CANNY, DEFENSE ATTORNEY: Well, as I understand it, FBI agents have actually gone to Aruba to help the investigation. Further, there`s the Texas search team that has gone to help. So I believe that American authorities are actually doing what they can, as well as volunteer groups from America are going there, to try and help, you know, find Natalee. So I think our services are being offered and accepted by the...

GRACE: Take a listen to this.

(BEGIN VIDEO CLIP)

ANTONIO CARLO, JORAN VAN DER SLOOT`S ATTORNEY: We have based our motion on a provision in the criminal procedure code of Aruba which says that, from the moment on that a suspect has been interrogated by a judge commissioner, from that moment on, the attorney of the suspect has a right to be present at any further interrogation.

Under the criminal procedure code of Aruba, once a defendant is detained, and before the start of the interrogation, if the suspect indicates, "I want to speak with my attorney," then the interrogation cannot start prior to the suspect having spoken within his attorney. But after that conversation is finished, then you know, the questioning can begin, and the attorney has no right to be present.

(END VIDEO CLIP)

GRACE: Robin Holloway is with us, Natalee`s stepmom. Ms. Holloway, I had great hopes that the case would be cracked after the father, the Aruban judge, was taken into custody. Do you feel as if the investigation`s back at square one because of his release?

R. HOLLOWAY: I don`t know about square one, but that was a huge setback with them releasing him. I mean, in my opinion, I mean, these guys, they tell so many different stories. I don`t know what their latest version is today.

But I mean, as far as the father, I think he can provide some answers. I don`t know if he knows exactly what happened or where she is, but he`s got some answers that we need. And with him not being in custody, I mean, will we get those answers?

GRACE: Back to CNN correspondent Karl Penhaul. You told me that some focus was on a manmade lake there. Any follow-up on that?

PENHAUL: No, no follow-up on that. In fact, the search teams called off a search there yesterday morning, partly because they were saying that there was media interference, some cell phones or maybe wireless microphone equipment interfered with diver`s communication equipment.

Tim Miller of that Equusearch search team said that a cadaver dog may have picked up some kind of scent or something, but certainly we didn`t see them back there at the lake today. And nothing so far, according to the police commissioner, has been found to indicate where Natalee may be or what may have happened to her, Nancy.

GRACE: Karl, Karl, what did you just tell me about interference because of a cell phone?

PENHAUL: It seems that the divers are using some kind of communication equipment to communicate, obviously, from underwater to command a command-and-control unit on the surface. And yesterday, Tim Miller and members of the Equusearch team were complaining that, because of the heavy presence of media in the area, and also civilians there, that some of the equipment that media and civilians were using had interfered with their own communication equipment.

GRACE: OK.

Very quickly, before we go to break, to Dr. Patricia Saunders, clinical psychologist. Do you sense that after the arrest, the erroneous arrest of these two security guards, locals, that other people may not want to come forward in this case that may know something?

DR. PATRICIA SAUNDERS, CLINICAL PSYCHOLOGIST: Yes, I think very much so, Nancy. And the picture that I`m getting is that this is maybe a very closed society. We have got rich people, and we`ve got poor working people. And those rich people seem to be very powerful. People may really be afraid of consequences if they come forth.

GRACE: Quick break, everyone.

And very quickly, to "Trial Tracking." Molly Bish, remember her? Sixteen-years-old, she disappeared from her lifeguard post at Commons Pond, Massachusetts, about five years ago this week. Well, Molly`s body was found in some woods nearby three years later. Police still unable to unravel the mystery of Molly Bish`s murder. After 7,000 tips, not a single arrest.

(BEGIN VIDEO CLIP)

MAGUALEN BISH, MOTHER OF MOLLY BISH: Molly is a light, and she will continue to be light for all our missing children. And Molly now has moved to the endless journey where we know she will be safe and protected. But we will miss her.

(END VIDEO CLIP)

GRACE: If you have any information on Molly Bish, please call the Massachusetts police, 508-832-9124.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

PAUL BERNARDO, CONVICTED SERIAL KILLER: We were a good team, you know? We were the best team. We were great, man. United we stand, together we fall. Fall for us, OK? You keep standing, pal.

(END VIDEO CLIP)

GRACE: An incredible story. They were called the Barbie and Ken serial killers. Homolka and her husband terrorized a community. One girl missing, another girl missing, a third killed. Tonight, attorney for the victim`s family, Tim Danson.

But first, to "Toronto Sun" reporter, Alan Cairns. Alan, it`s amazing to me that this woman, Homolka, a serial killer, is set to go free next week. What the hey is going on? Three murders that we know of.

ALAN CAIRNS, "THE TORONTO SUN": Well, in the eyes of the Canadian justice system, she is guilty of two counts of manslaughter, not of murder, and she is getting out of prison after 12 years for her parts in her husband, Paul Bernardo`s, killings of Kristin French and Leslie Mahaffy, two teens from this area, and in the fatal drug rape of her own sister, Tammy Homolka.

GRACE: Would you explain to those viewers that are not familiar with Homolka exactly what happened and why they have been called the Barbie and Ken Killers?

CAIRNS: Well, Paul Bernardo is an incredibly handsome, very attractive, young accountant when he met Karla Homolka back in 1987. Karla Homolka was 17-years-old old. Paul Bernardo was 23-years-old, the picture perfect couple.

Paul Bernardo was, at that point, involved in the start of a string of rapes in the Toronto area. And then he basically coaxed Homolka and got her involvement in the kidnapping, rapes and captivity of two young girls, Kristin French, 15, Leslie Mahaffy, 14. And before that, he got her assistance in drugging and raping her own sister, Tammy Homolka, who was only 15-years-old.

GRACE: And Alan, what about the video aspect of the rapes and murders?

CAIRNS: Well, Paul Bernardo and Karla Homolka videotaped their rapes, not the murders, but the rapes of the victims. And these videotapes didn`t surface until well after the February 15, 1993, arrest of the Paul Bernardo.

Karla Homolka struck a deal with prosecutors for 12 years in prison in exchange for her testimony against Paul Bernardo at his trial. The videotapes surfaced about 17 months later when Paul Bernardo`s first lawyer quit the case. And then prosecutors struck a deal with Homolka to not prosecute her after another rape came up on the videotapes, the rape of a girl who was known as Jane Doe, who was also 15-years-old at the time.

GRACE: You know, to Daniel Horowitz, the defense attorney sat on these videos of these girls -- schoolgirls being raped, including Homolka`s own little sister.

HOROWITZ: You know, Nancy, it is such a difficult, ethical issue.

GRACE: Oh, please.

HOROWITZ: Well, when you`re an attorney, you have -- you`ve sworn an oath, so you know you`re obligated to protect your client no matter how heinous the client is. Now, if you hide evidence, you`re breaking the law. But if you just know where it is, and you shut your mouth, you really are doing your job. So sometimes you, as a defense attorney, hurt inside so badly...

GRACE: Oh, yes.

HOROWITZ: ... but you just got to do your job. And you know what, Nancy?

GRACE: It hurts doesn`t it, Daniel? It hurts.

HOROWITZ: Well, it does. But we count on people like you, tough- nosed prosecutors, to find the evidence and there has been to be a balance.

GRACE: Oh, lord. You know, Daniel, how you turned that around on the prosecution, I admire that.

HOROWITZ: I complimented you, also.

GRACE: Yes. You did. The sucking up is not going to help tonight.

Here in the studio with me, Dr. Patricia Saunders. You know what? She got a free ride on this. She lured her own little sister.

Catch this. She gave -- Ellie, wasn`t it halcyon? She put in her sister`s eggnog at Christmas so the sister would be knocked out because her husband, co-defendant, wanted a virgin for Christmas.

Well, he got one. And shortly thereafter, the sister started choking on her own vomit and died. Authorities didn`t even realize this woman -- you`re looking at her -- helped to drug and rape her own little sister.

Now, you know what, Dr. Patricia Saunders, she got a light deal because of her looks and because she`s a woman. I`m just telling you like it is. But I don`t believe this guy brainwashed her.

SAUNDERS: Absolutely not, Nancy. She has gotten away with murder times three and then some. This woman is most likely a psychopath, a serial sexual predator. We don`t like to think about women that way.

GRACE: No, we don`t.

SAUNDERS: About 1 percent of the population in this country are female psychopaths. Now, to give you an example of what a psychopath this woman is, she wrote a letter to her friend at the time of her wedding saying she was really annoyed with her parents because they were selfishly grieving her sister`s death, and they wouldn`t give her enough money for her wedding, and gave it to the funeral instead.

GRACE: You know, don`t you just hate that, Tim Danson, when your parents dare to spend their hard-earned money on your little sister`s funeral after you helped kill her? Everybody, Tim Danson is the attorney for the victims` families.

And you know, I`m not hearing it from anybody else, but I am beside myself. Three lives of schoolgirls, for Pete`s sake, and the prize, 12 years behind bars? Tim, how can you stand it?

TIM DANSON, ATTORNEY FOR VICTIMS` FAMILIES: Well, it`s pretty shocking. And 30 million Canadians don`t understand it, either.

And at this point, she`s going to be released in the next couple of days. And the National Parole Board of Canada that has unique experience and expertise in these matters has told us that they feel that she represents a very serious threat to public safety.

And more disconcerting is that it`s their view that there`s a high probability that she`s going to re-offend. And re-offending for Karla Homolka means, you know, another victim who will be raped and murdered. And this is something that`s extremely disconcerting for all of us

GRACE: Well, we`ll be right back with you, Tim. What`s disconcerting to me is that she`s right there on the border with one foot in the U.S.

We at NANCY GRACE want very much to help solve unsolved homicides, find missing people. Take a look at 13-year-old Bryan Hayes. Bryan disappeared from his middle school, Jacksonville, Florida, Feb. 10, 2005. If you have any info on this little boy, Bryan Hayes, contact the Jacksonville sheriff`s office, 904-630-0500, or go online to beyondmissing.com. Please help us.

(COMMERCIAL BREAK)

(NEWSBREAK)

NANCY GRACE, HOST: Karla Homolka and her husband, Paul Bernardo. Hey, it looks a little like Princess Diana`s wedding, except these two are serial killers. Yes. And she`s about to get out from behind bars and walk free amongst us after just 12 short years behind bars.

You know, she was furious at her wedding that her parents spent their money, their money, on her little sister`s funeral. Little did they know at the time she walked down the aisle she had a hand in her sister`s drugging, rape and murder.

Only by turning state`s evidence did she get this sweetheart deal. I say it wasn`t worth it. The price tag was way too high. To the attorney for the victims, I`m sure they`re really upset over her release, which is coming up next week.

Tim Danson again, thank you for being with us. Tim, it drives me crazy that a defense attorney sat on these videos of Karla Homolka and her husband raping these little school girls.

The tapes finally were seen by you. What was on the videotapes? Why did these two serial killers feel they had to immortalize their murders?

TIM DANSON, ATTORNEY FOR VICTIMS` FAMILIES: Well, I think that`s the -- you know, they`re psychopaths. They`re sexual sadists.

No human being should have to see or watch these videotapes. Unfortunately, members of the jury had to see these videotapes.

The videotapes are graphic. They show the sexual violation, sadistic torture of these two young children. They do not show the murders, but they are searing. They are violent. They are shocking. And it shows you the brutality, as I say, that no human being should ever have to see.

Paul Bernardo is, on a number of occasions, telling them that they`re going to die, threatening death. But beyond that there`s really no words to describe it. These were two innocent children who were brutalized in a manner that`s unimaginable.

GRACE: And Tim, wouldn`t they keep the girls for days on end, torturing them, sexually, verbally, emotionally, before killing them?

DANSON: Certainly, with respect to Kristen French, it was for a number of days. And this is one of the great problems that the families have. When the original plea bargain was made with Karla Homolka, they didn`t have the videotapes, but they always said if they had the videotapes they wouldn`t have made the deal.

Subsequent to the deal being made, one of the conditions was that Karla Homolka make full disclosure and be honest. And when we view the videotapes we then saw that she had raped Jane Doe, her and Paul Bernardo.

She claimed that this was part of post-traumatic stress disorder due to battered wife syndrome and that she had amnesia. At that point in time, we believed that, and still believe strongly, that that was the opportunity to go back on the plea resolution because she had breached it, as well as charged for Jane Doe.

GRACE: Right.

HANSON: But unfortunately, they felt that -- first of all, they bought into the battered wife syndrome and this amnesia, which I consider to be...

GRACE: Wait. Who is "they"?

HANSON: Well, they had a team of experienced crown prosecutors, who believed in the -- the expert evidence that Homolka`s lawyers had put forward...

GRACE: Good lord.

HANSON: ... that she was suffering amnesia from post-traumatic stress disorder.

GRACE: OK. Wait a minute. Question: Tim, didn`t they kill Homolka`s little sister? I think she was, what, only 14?

HANSON: She was 15.

GRACE: Fifteen. Before the wedding?

HANSON: That`s correct.

GRACE: OK. Hold on. Elizabeth, can you run that wedding video for me again? This is not a woman under fear of her life, battered women`s syndrome. Look at her, partying hardy at her wedding. No, no.

What about it, Dr. Saunders?

DR. PATRICIA SAUNDERS, CLINICAL PSYCHOLOGIST: Absolutely not. It`s really disgusting, Nancy. This woman is a psychopath. She is nobody`s victim.

GRACE: Wait a minute. Look at this horse drawn carriage, and she`s whining that her parents didn`t spend enough on her wedding?

SAUNDERS: That`s the selfishness of a psychopath. Nothing matters except their needs.

GRACE: To Tim Danson again. You saw these videos. They`re horrible. Horrible. Of these two raping and molesting two little girls before murdering them. And this one, Kathy Homolka, would lure the girls in.

Didn`t they -- she drove up to one who was standing on the street, kind of lured her over to ask directions. And then the husband jumps out with a knife and put her in the car. And Homolka yanks her down by her hair to make her hide in the back seat, right?

DANSON: That`s what happened with respect to Kristen French. And it`s important, again, from the families` perspective and I think most people`s perspective, is that Karla Homolka always played the role of the compliant victim. That`s what she says.

But it`s interesting in the medical reports when Paul Bernardo inflicted physical harm on her dog, that was something that she was prepared to draw the line in the sand and stand up to him.

GRACE: You`re kidding.

DANSON: And in fact, did stand up to him, but she wasn`t able to stand up to him for her baby sister, her younger sister, and for Kristen French and Leslie Mahaffy.

So she is the master at manipulation. The battered wife syndrome does not apply to her. She didn`t strike out at the person who was allegedly battering her, but she struck out at two young, innocent children.

GRACE: Well, I find it very difficult to believe, Daniel Horowitz, that this woman you`re looking at had been brainwashed by her husband and forced to perform sex on her own sister on a video before killing her, before letting her die that way. Daniel, how could you have possibly, strategically, defended this woman?

DANIEL HOROWITZ, DEFENSE ATTORNEY: Nancy, I think that with people we are more complex than just battered woman`s syndrome. I think she`s probably somebody who does look for abusive battering men, and I`m sure she`s battered herself.

But we, as society, may say we`re going to forgive you if you lash out against the abusing man, but we`re going to draw the line and if you also act out against innocent victims. And maybe with this woman she took some pleasure in it, too, because it gave her a sense of power, then the excuse no longer exists.

So let`s not throw the baby out with the bath water. There are women in our society who are abused. And when they strike back and stand up for themselves, we have to give them credit for it.

GRACE: Daniel, Daniel, Daniel. What are you talking about, striking back and standing up for themselves? She helped kill three people. She molested them and tortured them. Take a listen to this.

HOROWITZ: Yes, well, Nancy, I know about power, and...

(BEGIN VIDEO CLIP)

BRUCE SMULLEY, STAFF INSPECTOR, TORONTO POLICE: There was some very brutal, cowardly sexual assaults, attacking defenseless women from behind and just pummeling them and brutalizing them.

At that point in time there was only one scientist assigned to the center who was qualified to conduct these tests, and back then you didn`t get DNA results as quick as you do now.

(END VIDEO CLIP)

GRACE: To Alex Cairns of "The Toronto Sun": Is Homolka due back in court tomorrow?

ALAN CAIRNS, "THE TORONTO SUN": Yes. She`s seeking an injunction to prevent the media from reporting about her release and tracking down her whereabouts, from reporting on her in any way, shape or form.

And -- and I understand probably why, because while her first few years in prison she set to all of her goals. She earned a B.A. She did everything they asked for her.

Over the last few years her choice of relationships is rather strange. The first one is with a lesbian inmate, Lynda Veronneau, and this smacks against everything that she said at trial, that she had no interest in women, that she wasn`t a lesbian. And then she ends up in a lesbian relationship in prison.

And her latest relationship is with convicted killer Jean-Paul Gerbet, who killed his girlfriend back in 1998. And Homolka has been there writing letters back and forth with Gerbet, swapping photographs, underwear, things like that.

GRACE: Swapping underwear?

CAIRNS: That`s correct.

GRACE: Man, she knows how to pick them.

Alan -- Alan, they seem like a normal couple, and they`ve been referred to as Barbie and Ken. What about this wedding extravaganza?

CAIRNS: Well, the really scary part about the wedding is that it happened about a week after they -- Paul Bernardo kidnapped Leslie Mahaffy, brought her back to the couple`s home, and the pair of them are involved in the rape of Leslie, a videotaped rape of Leslie.

And then in a horrendous series of events, poor Leslie is killed, and her body is dismembered and put into concrete blocks, which are thrown in a lake nearby. And in fact, those body parts and the blocks were found on the same day as the wedding.

GRACE: Take a listen to this.

(BEGIN VIDEO CLIP)

DANSON: I recognize that there may be problems with enforcing that part of the plea bargain when she`s free. Then she has the same constitutional rights as anybody else.

UNIDENTIFIED MALE: Our position is no media interviews, no recounting of information, directly or indirectly, relating to the horrible crimes that she committed.

(END VIDEO CLIP)

GRACE: Dr. Patricia Saunders, you seem especially interested in her behind bars reading material.

SAUNDERS: Yes. She was reported to be reading a book called "How to Disappear Completely and Never be Found Again." God help us all that this woman is on the loose, because she`s going to do it again.

GRACE: You know, Paula Canny, it is amazing to me that this woman is only going to be supervised for one year, and she`s already reading a book on how to disappear. I guess you know where. Right here. She`s probably walking down Third Avenue in Manhattan right now, Paula.

PAULA CANNY, DEFENSE ATTORNEY: Well, I certainly hope not. At least for the one year while she`s on parole, I don`t think that she`s going to be allowed leave the state of -- state of -- the country of Canada or that province.

And so yes, it`s a short parole period, only a year. And going back to that 12-year plea bargain, I mean, I don`t think that the prosecutors really thought through that in 12 short years -- it`s only, you know, four years per person that she murdered. I mean, it is an unbelievably bad plea bargain. Bad.

GRACE: Horrible. They had plenty of evidence to take both of these guys down.

Stay with us.

CANNY: They absolutely did.

(COMMERCIAL BREAK)

GRACE: Oh, what a happy day: two demons marrying each other. These guys are serial killers, everybody. This is their wedding day. Yes. Three victims that we know of, including her little sister. Drugged, videoed during rape and torture and murdered.

And guess what? She got the bargain basement plea deal of four years per dead body. She`s walking free next week. I wonder where she could possibly be headed? Maybe your town?

Welcome back. I`m Nancy Grace. Thank you for being with us.

Very quickly, back Tim Danson. He`s the attorney for the victims` family. You know, it`s amazing to me that she actually is going to court, according to Alex -- Alan, and asking that nobody report on her. How are we, the public, supposed to know where she is?

DANSON: Well, it`s pretty disturbing but not surprising for Karla Homolka. I mean, as I was saying earlier, I mean, this is a person who represents a very serious threat to public safety and is a high risk of re- offending. And she`s trying to turn the tables by making herself the victim.

The other factor in all of this is that, in Canada, like in the United States, we place a high freedom on free speech and freedom of the press. And -- and it`s constitutionally protected here, as it is in the United States, and the thought that someone like Karla Homolka would attempt to diminish those rights is rather objectionable. And I hope the court rejects it tomorrow.

GRACE: Very quickly, to Patricia Saunders. Do you think there are other victims?

SAUNDERS: Yes, there are some reports that the sister`s friends are coming forth now that they, too, were drugged and raped.

GRACE: OK. Homolka to be released. She`s in court tomorrow. We will update you on that.

Switching gears very quickly, tonight, let`s go to Gillette, Wyoming. Standing by, Shasta and Dylan Groene`s aunt, Sue Torres. But first to "Gillette News-Record" reporter James Warden.

James, what has become of the search for Shasta and Dylan?

JAMES WARDEN, REPORTER, "GILLETTE NEWS-RECORD": Well, so far from what we understand it`s pretty much in a holding pattern. The children disappeared May 16, or they were last seen May 15 and discovered missing May 16 from Coeur D`Alene, Idaho. And since then the search has been ongoing, and they`re still looking at leads, from what we can understand.

GRACE: As of tonight, I believe the reward is up to $107,500.

Joining us tonight Sue Torres. She`s the children`s great aunt. And she is begging the public as we head into the July 4 weekend not to forget Dylan and Shasta.

What have you been trying to do to help find Dylan and Shasta?

SUE TORRES, GREAT AUNT OF DYLAN AND SHASTA GROENE: Nancy, we`re handing out our flyers. We`re hoping there`s going to be a lot of gatherings this weekend. We`re just hoping that people will keep these kids` picture in their mind. Look for them at the Fourth of July displays.

We`re just trying to get the pictures out there and not to let people forget that these kids are still out there, and we want them home. Dylan`s birthday is July 16. And we would like to have him home for his birthday.

GRACE: He would be 10 years old, correct?

TORRES: Yes.

GRACE: Sue, what do you think happened to Dylan and Shasta?

TORRES: You know, I wish, I really wish I even knew. I can`t -- the nature of everything, it`s just too much to even imagine that could happen in your family.

GRACE: Take a listen to this.

(BEGIN VIDEO CLIP)

CAPTAIN BEN WOLFINGER, SHERIFF`S DEPARTMENT: We learned that there are two children that should be at that residence that we haven`t located. A 7-year-old -- an 8-year-old and a 9-year-old. The 8-year-old little girl named Shasta Groene and a 9-year-old boy named Dylan Groene.

Shasta is about 3`10", real small. Stands about 40 pounds. Dylan is about four foot even, about 60 pounds. Pretty small kids. They were last seen on a school bus yesterday getting dropped off at the house late yesterday afternoon.

ROCKY WATSON, KOOTENAI COUNTY SHERIFF: This is not a cold, stale case. There`s -- every day there`s leads turning to more leads that`s encouraging for this case.

(END VIDEO CLIP)

GRACE: To James Warden with the "Gillette News-Record," what new leads? You`re scaring me when you say the investigation is in a holding pattern.

WARDEN: I think the idea that consensus is that authorities are still looking. They`re still trying to find, but from what Sue is telling me they haven`t been a whole lot -- very forthcoming with new leads.

GRACE: You know, Sue, it`s hard to believe that these two just disappear into thin air. You`ve got to have a theory on what happened to Dylan and Shasta.

WARDEN: Well, there`s a lot of theories going around. But I don`t think anyone wants to speculate on that until the children are found.

GRACE: Sue, any theory?

TORRES: You know, Nancy, I think -- it`s something that I just would like to keep private. I -- when the kids come home, then, you know, then we can talk. We just -- we want the kids and that is our main focus.

GRACE: OK. Well, let me ask you this. You`ve been targeting gas stations. Why?

TORRES: Actually, I`m targeting anyone that will go beyond where we are and where we`re handing out flyers.

GRACE: OK. You told our producer that you`re targeting gas stations. Why are you targeting gas stations?

TORRES: I`m targeting -- actually, I`m targeting everything that I can.

GRACE: Very quickly...

WARDEN: The goal is to get these flyers out across the country as far as possible. And any place that`s mobile: airports, gas stations, hotels. That`s kind of the focus of that, because the theory is that the tourists or travelers will take those flyers and get them to different places.

GRACE: Very quickly, to tonight`s all-points-bulletin. FBI and law enforcement across the country on the look out for this man, John Feiga. Wanted in connection with a `97 murder of his ex-girlfriend in Florida. Feiga, 44, 5`10", 183 pounds, black hair, brown eyes.

If you have any information on John Feiga, call the FBI: 813-273-4566.

Local news next for some of you. But we`ll all be right back. And remember, live coverage of 16-year-old Sarah Johnson`s sentencing tomorrow, double murder charges, 3 to 5 Eastern, Court TV.

Please stay with us as we remember Specialist Charles A. Kaufman, just 20 years old, an American hero.

(COMMERCIAL BREAK)

GRACE: If you have any information on these two beautiful children, Dylan and Shasta Groene, just 8 and 9 years old, 208-446-2292. There`s a $107,500 reward for the two.

Very quickly, out to Daniel Horowitz. Daniel, what does it mean as each day passes and this case remains unsolved?

HOROWITZ: Well, Nancy, I believe that there was a woman at the scene who took these two children away from the murder scene and protected them. Now, they went away with the children. If she`s still protecting them or if she knows where they are, she has to call the police...

GRACE: Daniel...?

HOROWITZ: ... and come forward. That`s what`s going on.

GRACE: ... where did you get that, your crystal ball?

HOROWITZ: Yes, Nancy. You watch and see. That`s what`s happening. I want her to call you and come forward with where they are.

GRACE: Dr. Saunders?

SAUNDERS: I wish I inhabited the same fantasy land that Daniel did. I think these kids are gone and really gone and...

GRACE: Don`t you think there`s a possibility, if they had been murdered they would have been murdered right there on the scene? There is -- there is some logic to that reasoning. Why murder everybody else in the home and take these two kids away? He`s right about that.

SAUNDERS: Yes. But if this was a drug related hit and if the perpetrators were high, the kids may have just come in as an afterthought. They might have grabbed them. They didn`t know what to do with them. They were witnesses. And I`m afraid they may have killed them.

GRACE: And very quickly, Daniel Horowitz. I`ve only got a few seconds left. The fact that methamphetamines have been connected to their family, significance?

HOROWITZ: Yes. They could have been there for a drug debt, to fight, but they may not have planned to kill them. Bring the kids away, find out where the money is or the drugs are. When they didn`t come forward, then they killed the parents, but the kids were already separated away. That could have happened. They may be alive or, unfortunately, they may have eventually decided to kill them.

GRACE: To Sue Torres, as we say good night, any words tonight to anyone that may have seen Shasta and Dylan? Sue?

TORRES: Shasta and Dylan, we want them home. They`ve been traumatized. They need some love. They need -- they need their family. And they need help. We want to bring them home.

GRACE: Good night, Sue.

I want to thank all of my guests tonight. But my biggest thank you to you. Take a look at Dylan and Shasta. Thank you for being with all of us, inviting us into your homes.

Coming up, headlines from all around the world, Larry on CNN. I`m Nancy Grace signing off for tonight. Hope to see you right here tomorrow night 8 p.m. sharp Eastern. And until then, good night, friend.

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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