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Judge Denies Daniels' Motion; Avenatti on Judge's Ruling; Russia Expelling U.S. Diplomats. Aired 1-1:30p ET

Aired March 29, 2018 - 13:00   ET

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

[13:00:00] WOLF BLITZER, CNN HOST: A judge denying Stormy Daniels' motion to force the president and his lawyer to testify under oath, at least for now. I'll speak live with Stormy's lawyer. That's just moments away.

Plus, did the president choose another cabinet member based on chemistry over qualifications? New questions about the new job and his personal doctor just received.

And it's an American jewel with an owner who's became the richest man in the world. And now the president directly targeting Amazon. Is the beef personal or business?

Let's start with the breaking news, though.

A federal judge in California has just given President Trump a legal victory, denying a motion that would have led to the president's having to answer questions under oath about that $130,000 payment to Stormy Daniels. All that at least for now.

We're going to talk to Stormy Daniels' attorney momentarily. Stand by for that.

But first, let's go to our senior White House correspondent, Jeff Zeleny. He's over at the White House.

Jeff, first of all, what more can you tell us about this and whether you have heard any reaction at all from White House officials?

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Wolf, this certainly is an interesting development and I would assume that one the White House will welcome. The reality here is, this has been one of the concerns, will the president ultimately be deposed in this? Will he be, you know, submitted to questions about the Stormy Daniels situation?

Now, this is only one step in all of this, this judge ruling, you know, that blocking this motion for now. This certainly will be appealed. And it's far from the end of this. But this is what the White House has been wondering and worrying about, would the president be drawn into some type of legal dispute here or having the president sit for questions.

The White House has not yet reacted to it. The president, in fact, is flying to Ohio as we speak, so he's likely just seeing word of this while he's in the air on Air Force One. But certainly, wolf, the White House has been very reticent to talk about any of these matters. We've heard and seen in the White House Briefing Room all week, White House Press Secretary Sarah Sanders not wanting to answer questions about this. In fact, saying the White House has answered all the questions already about this.

The president had another opportunity to decide if he would answer questions about Stormy Daniels and other accusers as he left the White House about an hour and a half ago, Wolf. He declined once again.

BLITZER: Once again.

All right, Jeff, we're going to get back to you.

There's other news unfolding.

But right now I want to bring in Stormy Daniels' attorney, Michael Avenatti, to react to this latest developments.

So what's your reaction to this federal judge's decision, Michael?

MICHAEL AVENATTI, STORMY DANIELS' ATTORNEY: Well, Wolf, you know, over the course of my lifetime, it hasn't happened a lot, but it turns out that we were a little premature this time around. This is just a procedural ruling. It really means nothing. But I will tell you this, we're very, very encouraged by language in the order, not just suggesting, but basically finding that we're correct in the application of the law and the facts to this matter.

This does not bode well for the president or Mr. Cohen. And all indications are that when this motion is heard on the merits, we're going to get the discovery and we're going to get the trial we've asked for. And I think that we've provided some portions of that order that are important for people to comprehend and understand.

BLITZER: Because the ruling from this federal judge says the court denies without prejudice plaintiff Stephanie Clifford's motion for expedited jury trial pursuant to section four of the Federal Arbitration Act and for limited expedited discovery. That's legal words that obviously hard to understand, but what you're saying is that you're going to refile after the president or his attorney, Michael Cohen, have a chance to weigh in. Is that right?

AVENATTI: Well, yes. Let me -- let me explain this to your viewers if I can. So basically what the court has said is that we have to wait until the president and Mr. Cohen file their motion to compel arbitration. And as soon as we do that, or as soon as they do that, we can refile this motion.

And that's exactly what we're going to do. We expect that could be filed today, it could be filed in the next couple days. All indications are they're going to file that motion. Then we will, in turn, refile this motion. And then the court is going to make a determination. But, Wolf, there's language in this order that I am very, very pleased

with, because the court appears to agree with our assessment of the law, and it shows that what David Schwartz and others have said, that this motion had no merit, that that is baseless. I mean they're in a lot of trouble, Wolf. This is not good for the president, and it is not good for Mr. Cohen.

BLITZER: Well, it's at least a temporary gain for them, although, as you pointed out, you're going to refile and see what happens down the road.

As you know, Michael Cohen's attorney and his friend, David Schwartz, he was on CNN last night with Erin Burnett. And he said that Cohen, Michael Cohen, was acting independently of the president when he set up that $130,000 hush agreement to Stormy Daniels. Listen to this.

[13:05:07] (BEGIN VIDEO CLIP)

DAVID SCHWARTZ, MICHAEL COHEN'S ATTORNEY: The president was not aware of the agreement. At least, Michael Cohen never told him about the agreement, I can tell you that.

ERIN BURNETT, CNN ANCHOR, "ERIN BURNETT OUTFRONT": Not aware about the agreement. What about the money?

SCHWARTZ: He was not aware about any of it.

BURNETT: OK. OK.

SCHWARTZ: He was not aware. He wasn't told about it. Michael Cohen left the option open. That's why he left that signature line.

BURNETT: David Dennison.

SCHWARTZ: The option -- the option open to go to him. He chose not to.

(END VIDEO CLIP)

BLITZER: So what did you think when you heard that?

AVENATTI: What I think is that if we could drive David Schwartz to more television appearances, we would do it ourselves, Wolf. Every time they go on television, our case gets better and better. They're in a world of hurt. That was very, very damaging to their position that this is a valid agreement, very damaging. And that's going to come back --

BLITZER: Why?

AVENATTI: Well, because, now what's happened is, is that David Schwartz has claimed that the president knew nothing about this, had no involvement in it. And if that is true, the agreement's going to be thrown out because the president, and only the president, could bind himself to various provisions of that agreement. The agreement's going to be tossed out if what David Schwartz admitted to Erin Burnett is true, Wolf. BLITZER: Schwartz also suggested that Michael Cohen regularly set up

those sorts of agreements without telling his client. Let me play another clip for you.

(BEGIN VIDEO CLIP)

SCHWARTZ: Because he's that close to him, he had great latitude to handle these matters. Great latitude --

BURNETT: So they happened with such frequently that you wouldn't need to tell him about a $130,0000 payment?

SCHWARTZ: No, no, matter -- matters in general -- matters -- look, Michael was the fixer. We all know Michael --

BURNETT: Yes.

SCHWARTZ: So it could be anything. It's not that this matter -- there were a ton of matters that took place that Michael fixed and Donald Trump wasn't involved in every single matter.

(END VIDEO CLIP)

BLITZER: So what's your reaction to that?

AVENATTI: Well, Wolf, I mean, this is legal buffoonery. I mean it just gets -- these guys are making it up as it goes along. I just -- you know, as a guy that has practiced law at a high level and against some really good attorneys around this country for 20 years, I mean this is just amazing to me. I mean David Schwartz, if that's to be believed, there's significant ethical concerns now relating to Michael Cohen's conduct in supposedly settling cases without authority. That raises a whole host of additional issues for Michael Cohen. I mean these guys just can't get it straight, Wolf.

BLITZER: Did Stormy Daniels' first lawyer, Keith Davidson, reach out to Michael Cohen about that $130,000 payoff, what, 11 or 12 days before the presidential election?

AVENATTI: No.

BLITZER: Because that's what they argue. They argue that they were approached by Keith Davidson. Keith Davidson came up with the $130,000 figure and Michael Cohen paid it.

AVENATTI: It's not accurate, Wolf.

BLITZER: How do you know that? How do you know that? Have you spoken to -- have you spoken to Keith Davidson about this?

AVENATTI: It's no -- it's no -- well, I -- I'm not going to get into the details, Wolf, as to how I know that.

But, look, that assertion is just as accurate as Michael Cohen paying the $130,000 from his own money and never talking to the president about it and the president knowing nothing about it. It's just -- it's patently false.

BLITZER: Will your client, Stormy Daniels, release Keith Davidson, her first lawyer, from what he describes as attorney-client privilege that prevents him from discussing all this publicly?

AVENATTI: I don't know, Wolf. We haven't discussed it. There's a -- that's a big determination for a whole variety of reasons that are -- that are far more important in many instances than this particular finite issue. She may consider it and she'll make a determination, ultimately.

BLITZER: But if your goal is for the American people, the American public, to know the entire truth and you're simply seeking transparency, that's what she said in her interview on "60 Minutes" with Anderson Cooper, why not release him and let him tell everything he knows publicly?

AVENATTI: I'll tell you what, Wolf, we'll make this challenge. If Michael Cohen and the president will waive the attorney-client privilege relating to this NDA and all of the others, my client will as well. How about that?

BLITZER: Well, you know, you -- but you could release them right away, even on your own, if you're -- if you're simply seeking transparency and letting the American people know exactly what happened.

AVENATTI: Well, Wolf, again, this has got to be a two-way street. Where is Michael Cohen? Where is the president? We've gotten no information from them. Zero. We continue to go on television. We're asked tough questions from you and others. We're answering those questions. These guys are nowhere to be found except for the legal buffoonery of David Schwartz.

BLITZER: Did Keith Davidson, from your perspective, act unethically on behalf of your client, Stormy Daniels?

AVENATTI: I have an opinion on that, Wolf, but I'm not going to state it on national television. I don't feel comfortable doing that.

BLITZER: Because in the past you've said he needs to go to ethics class. What did you mean by that?

AVENATTI: No, I think what happened was, I was asked a question -- he made a statement following the "60 Minutes" episode and I thought -- I said that I thought he needed to be more interesting in pursuing an ethics class than making a splash in the press. I stand by that statement.

But I'm not here to disparage Keith Davidson. I have an opinion about what happened but at this point I'm going to keep it to myself.

[13:10:06] BLITZER: It's very interesting because, as you know, two months before the hush agreement that was worked out with Stormy Daniels, just a few days before the election, in August of 2016, Keith Davidson, the same lawyer, worked out a non-disclosure agreement with Karen McDougal, the former playmate. Do you accept that it was Davidson, instead of Cohen, who came up with that deal?

AVENATTI: That's my understanding, Wolf. But I -- quite honestly it's sheer speculation. I don't know a lot of the details relating to the situation between Keith Davidson and Ms. McDougal.

I do want to go back, though, if I could, to this order. Do we have the provisions of the order that I had referenced earlier, because I think they're critically important?

BLITZER: Well, we do have the order. It's a several-page document here. But if there's a specific thing you want to read.

But let me just wrap up with Keith Davidson.

He got $150,000 for his client, Karen McDougal, from American Media, the parent company of "The National Enquirer," and in exchange for that she was supposed to do things for "The National Enquirer" and in exchange for that she was supposed to do things for "The National Enquirer" and other American Media publications and not talk about her relationship with Donald Trump many years earlier, back in 2006-2007 as a private citizen.

I'm just wondering if this was a normal procedure for Keith Davidson to work out these kinds of arrangements for women who alleged they had affairs with the -- with then private citizen Donald Trump.

AVENATTI: Well, I don't know. I think you'd have to ask Keith Davidson. I mean that's never been my line of work. Perhaps it was his.

BLITZER: Well, we keep asking him, but he cites attorney-client privilege and he says that your client, Stormy Daniels, won't let him out of that and, as a result, he can't speak publicly.

AVENATTI: Well, wait a minute. No, no, no, wait a minute, Wolf, my client's attorney-client privilege with Keith Davidson doesn't have anything to do with being able to answer the question you just posed --

BLITZER: Right.

AVENATTI: Which is, did he do this on a regular basis for other people. So, I want to be clear, my client is not permitting him from answering questions as to that or answer -- providing answers as to that question.

BLITZER: But Stormy Daniels, in the course of many conversations she presumably had with her then attorney Keith Davidson, may have discussed these kind of issues, whether he's done this before, how reliable is this kind of agreement if she accepts the $130,000. There's a lot of questions that -- that could be raised based on the conversations the two of them may have had.

AVENATTI: Well, let me say this, Wolf. Based on my understanding, I'd be very, very surprised if any of that type of discussion occurred between Mr. Davidson and Ms. Daniels and that's all I'm going to say. BLITZER: Why would you be surprised? Wouldn't that be a normal question a client would ask her lawyer, you know what, have we ever done this -- have you ever done this before? How good is this? I'm really worried.

AVENATTI: Yes.

BLITZER: Those would be normal questions. I'm sure your clients ask you those kinds of questions all the time.

AVENATTI: Well, I mean, there's a lot of things that, in normal circumstances, would happen that don't appear to have happened in this case or this instance, Wolf, with Mr. Davidson.

But, again, I'm not here to opine as to -- or to provide my opinion as to what I think of his conduct.

BLITZER: You've made, obviously, a lot of TV appearances. And some of your critics are suggesting your real aim right now is to bait the president of the United States into breaking his silence on this and speaking out. He's remained totally silent. As you know, he usually likes to tweet. He likes to counterpunch when somebody is going after him. But on this he's remained totally silent. Is that your goal, to bait him into breaking that silence?

AVENATTI: No, Wolf, our goal is to get straight answers, simple, straight answers as to some very finite questions that the American people deserve to have answers to. And I don't know why some are calling that baiting.

BLITZER: You want the president to speak out, though, don't you?

AVENATTI: Well, we want to hear what the president has to say as to the following, very basic questions, Wolf. Did he know anything about the agreement? Was he aware of the negotiation of the agreement? Did he sign the agreement? And what did he know, if anything, about the $130,000? And I guess lastly, did he reimburse the $130,000 or arrange for somebody else to do so? I mean these are five very basic questions. I don't understand why we can't get answers from people on them.

BLITZER: Well, he clearly didn't sign the agreement because that line that has "DD" on it, that was the pseudonym as part of the agreement, that he didn't sign the agreement. So that's one of the questions that we have the answer to, right?

AVENATTI: Well, I mean, you know, Wolf, nothing will surprise me anymore in this case, especially based on what I've seen over the last three weeks and the complete fabrications. I mean for all we know they're going to come forward with a page that has his signature on it and claim that he actually signed it, which would be rather shocking. But, again, nothing will surprise me anymore in this case.

BLITZER: I want to get your reaction to what we heard from the well- known criminal defense attorney, Mark Geragos, who has represented, as you know, some of the biggest celebrities here in the United States. He had this to say about your client's "60 Minutes" interview with Anderson. Listen to this.

(BEGIN VIDEO CLIP)

MARK GERAGOS, CRIMINAL DEFENSE ATTORNEY: It reminded me of Geraldo in the vault (ph). I mean, you know, there was nothing there. So I -- the whole thing --

[13:15:04] BROOKE BALDWIN, CNN ANCHOR, "NEWSROOM": I was -- we haven't talked since that interview.

GERAGOS: The whole --

BALDWIN: Did you think it was a nothing burger? What did you think?

GERAGOS: I mean, look, what -- the -- that -- that supposed threat in the parking lot seven years ago, give me a break.

(END VIDEO CLIP)

BLITZER: All right, I'll give you a chance to respond to Mark Geragos.

AVENATTI: Well, you know, I know Mark personally and he's a -- he's a good guy and he's a very good lawyer. I could not disagree with him more as to his assessment. But, you know, that's OK. We agree about 90 percent of the time, and the other 10 we vehemently disagree. So this falls in the 10 percent. It doesn't mean he's wrong or I'm right or vice versa.

BLITZER: So where does it go from here? What's the next step?

AVENATTI: Well, we're going to wait for the president and Mr. Cohen to file their motions to -- or their motion to compel arbitration, and then we're going to immediately refile our motion. And, again, Wolf, based on the language of the order that came down today, they're in a world of hurt. They are not in a good place. We told them what the law was before we filed the motion. They didn't seem to understand it. Maybe they're going to understand it now.

But I think we're going to get the discovery that we've asked for and I think we're going to get the trial that we've asked for. And I think the court's order indicates that based on the citation to the law that we initially provided in our papers.

BLITZER: So you see this federal judge's order as a temporary setback, but it's going to take a few extra weeks to see what happens down the road. It's not going to be resolved at least in the next few days, by April 30th was the original date, right?

AVENATTI: Well, no, it could still be resolved on that date because there's a certain notice period that has to be provided, and we're still within that period.

But, Wolf, I want to be clear about something, we don't see this as a temporary setback at all. I mean this isn't even a -- it's not even a gnat. I mean it's -- the court has denied it without prejudice on procedural grounds. We know they're going to file their motion. We're going to refile it. Look, I've got to -- I have to tell you, I'm excited about our prospects more -- now more than ever because of the language in the order.

BLITZER: Michael Avenatti, thanks so much for joining us.

AVENATTI: Thank you, Wolf. Appreciate it.

BLITZER: All right, thank you.

And David Schwartz, the attorney representing Michael Cohen, will be a guest later today on "The Lead." That's at 4:00 p.m. Eastern. We'll get a very different perspective at that time.

Other news we're following.

It's an American jewel with an owner who's become the richest man in the world. And now the president directly targeting Amazon. Is the beef personal or business?

Plus, Kellyanne Conway may be one of the most -- one of the president's most loyal advisers, but her husband, apparently, not a fan. Why he's been, quote, trolling President Trump online. And sources say aides are worried that President Trump will unravel without Hope Hicks, who is leaving the White House today. So what happens over at the West Wing without a communications director? All that coming up.

(COMMERCIAL BREAK)

[13:21:58] ANNOUNCER: This is CNN breaking news.

BLITZER: All right, there's breaking news. Russia's foreign minister, Sergey Lavrov, has just announced that Russia will shut down the U.S. consulate in St. Petersburg and will also expel 60 U.S. diplomats in retaliation for what the United States did a few days ago, shutting down the Russian consulate in Seattle, Washington, and expelling 60 Russian diplomats who work here in Washington at the Russian embassy, as well as the United Nations. It's all part of the fallout over the poisoning of a former Russian spy and his daughter in the U.K.

Let me bring in Democratic Senator Chris Van Hollen of Maryland, who's on top of all of this.

Not a huge surprise. We always anticipated the Russians would retaliate, tit for tat, and they just did.

SEN. CHRIS VAN HOLLEN (D), MARYLAND : That's right. Not a surprise at all, Wolf. It was very important that we stand with our allies, with the U.K. and others, sending a strong signal after the poisoning we saw in England. I hope -- the main thing I hope is that the Russian action doesn't discourage this president and the White House from continuing to fight back against Russian interference in certain places around the world where they've been a very counterproductive influence, but also we don't let down our guard in preparing for potential Russian attacks on our elections. We need to really push back hard. BLITZER: Well, how serious is that fear that Russians could interfere

in the midterm elections coming up in November?

VAN HOLLEN: Well, it's a very serious fear because we know they did it in 2016. We know from the administration's own top intelligence folks, whether it's from NSA or from CIA, that they expect the Russian to try to do that again. This is why Senator Rubio and I have introduced the Deter Act. The Deter Act is to discourage Putin and others from interfering by creating very tough automatic penalties if they get caught in 2018.

BLITZER: In expelling those 60 Russian diplomats from the United States, U.S. officials said most of them were really intelligence or spies, intelligence operatives or spies. Presumably the Russians do the same thing to the American diplomats who are now being expelled over the next few days, whether CIA or other U.S. intelligence agents working undercover as diplomats. How much of a problem will that be in undermining U.S. intelligence gathering capability in Russia?

VAN HOLLEN: Well, the first question, Wolf, is, how many of these are really intelligence folks? I can assure you that the majority of people in our consulate there are actually diplomats doing their work.

BLITZER: But there are CIA and other personnel who work there.

VAN HOLLEN: You know, I'm not on the Intelligence Committee --

BLITZER: Yes.

VAN HOLLEN: But the reality is that the Russians are known to populate their embassy and consulates with a lot more of their intelligence folks than other countries.

BLITZER: But the U.S. does it as well.

VAN HOLLEN: Well, obviously we have intelligence folks overseas --

BLITZER: Yes.

VAN HOLLEN: Including Russia. But I -- the idea that 100 percent of our folks in St. Petersburg would somehow be --

BLITZER: No, no one says 100 percent.

VAN HOLLEN: Right.

BLITZER: Many of them are career diplomats, foreign service officers, most of them, presumably, but there are some who work undercover.

[13:25:03] VAN HOLLEN: Again, I don't know with this particular site. But the Russians have been known to spend a lot more of their assets investing in the intelligence area.

BLITZER: Should the U.S. now further retaliate, or is it over, at least this chapter? We expel 60, they expel 60. Is it over or is this going to escalate into more tension? VAN HOLLEN: Well, I'd have to actually look at all the specifics with

respect to this particular Russian action. What we should make sure we do not do is say, oh, boy, every time we do something, the Russians are going to respond, so we shouldn't do things going forward. We should take action going forward.

You know, the president, finally, after Congress mandated that he do it, identified a number of Russian oligarchs who had been part of interfering with our elections before. You know, that was about the minimum that we should have done. So we should send a very clear signal --

BLITZER: Do you want more action?

VAN HOLLEN: Well, but through legislation. We need to make it clear that it's automatic and very tough. For example, the legislation we've introduced would say, if they get caught interfering in our election again, then we're going to penalize not just a few oligarchs. We're going to go after their banking sector. We're going to go after their oil sector. We're going to make it hurt because we want Putin to know it's not worth it to him to interfere in our elections.

BLITZER: This is a tense moment in U.S.-Russia relations. There's no doubt about that.

While I have you, a very political question.

VAN HOLLEN: Sure.

BLITZER: Based on a new CNN poll that has just been out. And I ask you this because you're the chair of the Democratic Senatorial Campaign Committee. One of your responsibilities is to help Democrats get elected.

VAN HOLLEN: Right.

BLITZER: You would like to see a Democratic majority in the U.S. Senate.

The new poll that we just had has Republicans closing the gap on the generic ballot question, who do you want to see in control? Take a look at this. Party's candidate you would vote for midterms were held today. Back in February, the Democrats had a 54-38 advantage. Now it's 50-44. The Republicans have closed the gap. Only a six point difference.

What's your reaction to that?

VAN HOLLEN: So, Wolf, I've tracked these CNN polls. We were up in December, down in January, back up in February, down a little bit here in this measure.

BLITZER: This generic question.

VAN HOLLEN: Just generic. But where we're up consistently, including in this month's CNN poll, is the enthusiasm and energy of voters. And in midterms, that's the thing to keep an eye on because that determines who actually comes out to the polls, not just who's answering the question at the other end of a telephone. And if you look at that measure, Democratic enthusiasm has gone up, including this month -- matching last month, whereas Republican enthusiasm has been flat.

BLITZER: I noticed that as well. So Republicans have a majority, 51- 49. Do you think you can be the majority of the Senate after the midterm elections?

VAN HOLLEN: Well, we're fighting every fight here. We've got to defend 26 seats and we need to try and pick up an additional two. We're working very hard to try to accomplish that goal. More to the point, our senators, who are out there fighting every day for the people of their states are out there doing that.

But, look, if you'd asked me a year ago whether we'd be in as strong a position as we are today, I would have said no. So we're feeling good about where we are because the public is watching what's coming out of this White House and they do not like what they see.

BLITZER: Senator Chris Van Hollen, thanks for joining us.

VAN HOLLEN: Thank you.

BLITZER: Appreciate it very much.

Coming up, the president announces the ouster of his Veteran Affairs secretary on Twitter, replacing him with the White House physician. Is President Trump adding to his roster of yes men?

Plus, more on our breaking news. A judge just now denying Stormy Daniels' motion to depose the president and his lawyer, Michael Cohen. Stand by. There's new details.

(COMMERCIAL BREAK)