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Judge: Cohen, Trump Teams Can Review Seized Materials; Cohen Hearing Reveals Fox's Hannity As Mystery Client; White House Walks Back Haley's Russia Sanctions Announcement; Comey: Trump Calling For Foes To Be Jailed Is Dangerous. Aired 11-11:30a ET

Aired April 17, 2018 - 11:00   ET

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

[11:00:11]

KATE BOLDUAN, CNN ANCHOR: Hello, everyone. I'm Kate Bolduan. Ratings, rants and maybe some revelations. It's a morning of must-see tv in the political drama known as the Trump presidency.

This hour, Stormy Daniels speaks out, her attorney says she'll also be releasing a sketch of the man she says threatened her and her child to keep quiet about her alleged affair with Donald Trump.

It comes just hours after a major ruling in the government's case against Michael Cohen, the president's private attorney. There were audible gasps in that hearing, in that courtroom, as Michael Cohen's legal team was forced to identify a mystery client, the big reveal, yes, it sounds like reality tv, turns out to be Fox News host, Sean Hannity.

One of the president's biggest supporters on cable tv and a fierce critic of the FBI raid on Cohen's properties. Before it came out in court, Hannity had never disclosed that relationship.

Also, going public overnight, James Comey's book, this morning, the former FBI director in his first live interview gave this dire warning to the country.

(BEGIN VIDEO CLIP)

JAMES COMEY, FORMER FBI DIRECTOR: We wake up in the morning and see the president of the United States is accusing people of crimes without evidence and pronouncing them guilty and saying they should be in jail. That should wake all of us up with a start.

But, there has been so much of it we're a little bit numb and that's dangerous. One of the things I hope to do is courage people to think about that and focus on that rather than becoming sort of numb to it and trying to squeeze it out of your mind.

(END VIDEO CLIP)

BOLDUAN: All right, let's begin with that extraordinary court hearing here in New York, a federal judge ruling that Michael Cohen's legal team will have the chance to review materials seized in the raid of his home, hotel room, and office. What does that mean for him? What does it mean for the president and does that get us any closer to learning exactly what the FBI was looking for in the first place?

CNN's Brynn Gingras is following all of this for us. It is a whole lot, Brynn, so what exactly has happened here?

BRYNN GINGRAS, CNN NATIONAL CORRESPONDENT: It's a whole lot. It slows things down just a bit, but let's break it down for you. Essentially, the federal judge in this case giving all sides a little bit of what they wanted without yet making a final determination about how investigators will be able to review those seized documents from last week's raid on Michael Cohen's home, office, and hotel room.

Now the U.S. attorney's office will hand over copies of the seized materials to Cohen's legal team and the judge has asked them to get an idea of the volume of the documents they believe is protected by attorney/client privilege, which again is what this hearing is all about. The judge also ordered the government to do the same.

Now, remember, the president filed a late motion wanting access to all those records as well and the judge also authorized Cohen's team to give Trump's lawyers whatever material pertains to the president and the Trump Organization.

But all of this somewhat overshadowed by the fact that we learned in court Fox News host, Sean Hannity, is a client of Michael Cohen's. Now this came out in pretty dramatic fashion in court after the judge insisted Cohen's attorneys hand over a list of his clients.

There was a short list, Trump, RNC fundraiser, Eliot Broidy, who Cohen helped negotiate a payout to a "Playboy" model after getting her pregnant, and an unnamed third client, which is Hannity.

Now Hannity claims he only sought legal advice from Cohen, wasn't an actual client, never even paid him, though, still admitted to wanting attorney/client privilege. Here is what he said on his radio show.

(BEGIN AUDIO CLIP)

SEAN HANNITY, HANNITY RADIO: I might have handed him 10 bucks, I definitely want attorney/client privilege on this, something like that.

(END VIDEO CLIP)

GINGRAS: Now, of course, that can be debated. Back to this criminal investigation into Cohen's personal and business dealings. While, it is new to us, the government actually revealed in court it has been working on this case for months, but in some aspects, it will now slow down just a bit until all sides come back to court regarding theSE documents and Kate, that could take several weeks.

BOLDUAN: And what could happen in the meantime? Let us stand by and see. Brynn, great to see you. Thanks so much for breaking it down for us. Let's discuss this a little bit more now. CNN legal analyst, Page Pate is here, a criminal defense attorney and constitutional lawyer, and Caroline Polisi, an attorney specializing in federal and white- collar crimes. Great to see both of you. Thanks for coming in.

Caroline, first to you, how big of a sigh of relief is Michael Cohen and his team breathing right now, do you think?

CAROLINE POLISI, FEDERAL AND WHITE COLLAR CRIMINAL DEFENSE ATTORNEY: Not that big of a sigh. The initial asks they wanted to basically roll back the hands of time and get all of the information back at the initial state. Essentially, they were asking for the procedure that would be put in place for a subpoena instead of we know there was a search warrant obviously issued so the government has access to all this information.

So, they definitely didn't get that. I mean, they definitely got some brake pumping a little bit on the speed at which this investigation is proceeding. But for sure the government is going to get to at least look at this information in tandem with Cohen's team at this point and duke it out with potentially a special master or Judge Kimba Wood herself deciding over these issues of privilege.

BOLDUAN: It's pretty amazing how this is all playing out. Page, why is there so much drama over the unveiling of Cohen's list of clients?

[11:05:03] PAGE PATE, CNN LEGAL ANALYST: Well, I think there was the expectation, at least this is the expectation and Michael Cohen's legal team wanted us to have, that he had a lot of clients, had a lot of privileged information that were seized by the government.

Of course, it turns out, I don't think that's true at all. He was only able to identify two clients and a half client, with Sean Hannity. I think that's very odd. I know as a lawyer, I can identify all of my clients and my clients know that I'm their lawyer.

It is very confusing when your client is unsure if you're representing them or not. So, at end of the day, I think the judge is not going to have a lot of privileged material, they have to decide whether it can be released to the government or not.

I think it is a very small world or small universe of information that is going to be reviewed and subject potentially to attorney/client privilege.

BOLDUAN: Caroline, do you think that's what this is more about, that they were trying to make it seem like a huge burden, of what he was -- all of the documents that got swept up and what they were looking at. Because I do wonder, if Hannity really wasn't Cohen's client, why did Michael Cohen feel that -- the need to disclose him as a client? It seems a simple question.

POLISI: Yes, I mean, there is clearly a disconnect between what is going on here, what Cohen's attorneys are stating in court to a federal district judge, and then what Hannity is saying in his disclosures now, tweets. What I think is really interesting is he parsed the words in Hannity's tweets, he is saying that he dealt, quote, "almost exclusively" with Cohen on real estate matters. OK, so the question, that's lawyer speak for there is something else.

Why did he have to say almost? So, I think that there is definitely more to this story. Clearly there is some miscommunication between Michael Cohen's defense team and Sean Hannity.

BOLDUAN: But on the most basic level, and, yes, this is going to come -- I don't care if it comes across as a dumb question. How is it determined that someone is actually a client? Hannity seems to want the privilege of attorney-client privilege, but he says that he is not a client.

PATE: Yes, Kate, he wants it both ways. You really can't have it that. I mean, tt the end of the day, the Supreme Court protects communications between a lawyer and a client. Now what determines if there is a lawyer and a client. It is the expectation between those two individuals.

I can't talk to someone and think they're my client if that person doesn't believe they're my client and then have those communications protected. So, it is a mutual understanding between the lawyer and the client or the potential client.

Money is not a factor. This $10 payment, that's ridiculous. You don't have to pay a lawyer to have attorney/client privilege, but you have to have that expectation. Both sides need to know that what we're talking about is privileged and needs to remain between the lawyer and the client.

BOLDUAN: Caroline, I assume your hourly rate is a little more than $10 an hour. I won't ask you to answer that, though. Shimon Prokupecz, he made a really good point about how all this came out in terms of the client list.

He said if it wasn't for the attorney representing the press, and the media in this, that Hannity's name would not -- would have been filed and sealed. The judge was prepared to allow that to happen, just hand an envelope basically over to the judge with his name in it, except the attorney representing the press stood up and argued successfully against it. What does that mean, do you think, for this whole court battle going forward?

POLISI: I think it is very interesting. I love this new piece of information that we're hearing. Were it up to Michael Cohen, he would have -- I love this out of a mob movie, slipped the name across the podium to the judge there.

Exactly. Exactly. But then as you said, this -- the First Amendment attorney for the press was able to convince Judge Wood, and I think it speaks highly of Kimba Wood that she's making on the ground decisions in this case.

She will not be swayed by sort of, you know, aggressive tactics on the part of these attorneys. She's going to make a reasoned decision based on the information she has in front of her.

The fact is the name of an attorney, the name of a client of an attorney, is not in and of itself privileged information. So, this was clearly a well briefed and sound ruling.

BOLDUAN: One other thing, Page, that Shimon reminded us of, something the federal prosecutor had said in the courtroom about the Cohen investigation, and I'll read you the quote that Shimon put out.

It is -- this is from the prosecutor, "It is important to remember why we're here, which is that the federal magistrate judge found probable cause that there was evidence of crimes in Mr. Cohen's premises and on his devices. When they put it out like that, it makes me wonder why would the president of the United States want to get involved in this battle at all?

PATE: Yes, Kate, I mean, that's a great question because I'm not sure. I mean, obviously, the amount of effort and energy that the president is applying to this case means there is something there that he wants to protect.

Because if there is really just, you know, innocuous conversations about the Stormy Daniels situation, or about some other legal matter, that is not evidence of a crime, then I don't know that the attorneys for Trump would be objecting to it.

Because the government is going to get to see it anyway. The only question is whether Trump's lawyers get to see it first. So, that leads me to believe that there is something in that affidavit that convinced that magistrate judge to issue these warrants that shows evidence of a crime.

[11:10:08] Now, what crime it is, we can only speculate. But there had to be something there and something significant to authorize this kind of exceptional search warrant being executed on a lawyer's office.

BOLDUAN: A lot of work ahead for attorneys on both sides before they head back into the courtroom. Caroline, Page, great to see you both, thank you.

Coming up for us, remember the new sanctions against Russia, the U.N. ambassador, the U.S. -- the U.N. ambassador said we're coming just yesterday? Well, Nikki Haley, he may want to call your office. Why is the president now so upset? That's next.

Plus, you know what's bad when one of the guys throwing punches even concedes, quote, "this is not normal." James Comey versus Donald Trump, the latest.

(COMMERCIAL BREAK)

BOLDUAN: President Trump putting the brakes on punishing Russia. The "Washington Post" is reporting that the president was, quote/unquote, "upset" when his U.N. Ambassador Nikki Haley said more sanctions were coming following the chemical attack in Syria. Listen to this. (BEGIN VIDEO CLIP)

[11:15:08] NIKKI HALEY, U.S. AMBASSADOR TO THE UNITED NATIONS: So, you will see that Russian sanctions will be coming down. Secretary Mnuchin will be announcing those on Monday, if he hasn't already. And they will go directly to any sort of companies that were dealing with equipment related to Assad and chemical weapons use.

(END VIDEO CLIP)

BOLDUAN: That was just Sunday. White House Press Secretary Sarah Sanders very quickly walked it back, saying the administration is only considering new sanctions and, quote, "a decision will be made in the near future." What is going on here?

Joining me right now to offer some perspective, Republican Senator Rob Portman of Ohio. He's on several key committees including Foreign Relations. Senator, it's great to see you. Thanks for coming in.

SENATOR ROB PORTMAN (R), OHIO: Kate, great to have you back on.

BOLDUAN: Thank you. When it comes to sanctions, who do you believe, the U.N. ambassador or the White House here?

PORTMAN: Well, it sounds like they have got an internal discussion still to be had. Sanctions have been effective. I think there need to be additional sanctions, not just for what is happening in Syria.

But also, what is happening -- I just got back from Ukraine, the eastern border of Ukraine, and the disinformation campaign continue throughout the Eastern Central Europe and so I do think sanctions are effective and can be more effective in the future.

BOLDUAN: Why the hesitation then from the White House? I mean, Nikki Haley isn't one to speak out of turn, especially when she knows what she's doing on the Sunday talk shows. I mean, do you -- what do you think happened there?

PORTMAN: You know, I can't speculate except to say that it is a decision that includes some larger geopolitical stuff going on in the region. I imagine, my understanding from the sanctions that she discussed that might be in place is that they would be specific to Syria. In other words, stopping some of the Russian arm sales and some of that activity.

And again, some of our sanctions in the past have been effective in that, Kate, because there have been armed sales that were meant to move forward that were stopped because of countries being concerned about the sanctions we were putting in place. I think it can be very effective and hopefully move forward with it.

BOLDUAN: Stand by to stand by on that one and see where that turns next. One critical part that is missing when it comes to Syria, and many other things, is the secretary of state. Should the full Senate vote on Mike Pompeo even if your committee votes against him? PORTMAN: Yes. Yes. And I think it is important we have a secretary of state in place. I talked to some of my Democratic colleagues on the committee. We had a hearing last week, as you know. I thought Pompeo did a good job, some are concerned about the broader position that the administration is taking on some foreign policy issues. I get that.

But we need a secretary of state in place, and Pompeo having been director of CIA is very well aware of the hot button issues around the world, including obviously what is going on in Syria, North Korea and Iran. So, I think he's a good pick and I hope we had the chance to vote for him on the floor and get him in place. We need him now.

By the way, he's going to help in terms of getting the career foreign service people morale up because that's one of the issues we have right now. We need to have the stronger State Department, soft diplomacy is soft power, and diplomacy is need. I think he'll be good at that.

BOLDUAN: But Senator, you would not be happy if the Democratic majority circumvented essentially your committee and said, even if you -- if he doesn't pass the vote in foreign relations and takes it straight to the floor, you wouldn't be happy with that. Why is it OK now?

PORTMAN: Well, I don't think I would object as long as there is a vote on the floor and people can vote their conscience yes or no. We've done in the past where there has been a tie vote, and I imagine when there is a negative vote, I suspect in committee from counting the heads as I have that maybe it will be a tie vote, by the way.

And my point is that we need to have a secretary of state in place and he's got the experience and background to be able to hit the ground running and he's need. And the State Department morale will be improved if he's in place, in my view.

BOLDUAN: Senator, the former director of the FBI is out with his new book today. Not sure if you're aware of that with everything going on. The president called -- he called the president -- James Comey called the president morally unfit to be president. Trump responded saying that Comey should be prosecuted, Comey today then says that the president is calling for the imprisonment of a private citizen and that that is not acceptable in this country. Who are you with here?

PORTMAN: Well, I hope that FBI directors and for that matter, you know, those of us in public service in general can get above the fray. I know that also in the book apparently, I haven't read the book, but apparently, he also talks about the president's color of his skin, being orange, or something like that, and the size of his hands and the length of his tie.

I just think this is, you know, we're sort of falling into this -- I don't know, tabloid type back and forth stuff that I think has no place in public service. So, I'm not big on kiss and tell books in general. As someone who is a law enforcement official, I think we ought to be above the partisanship and above the name calling. BOLDUAN: Do you think he shouldn't have written it at all?

PORTMAN: Well, look, again, I haven't read it, so I can't judge it. From what I'm hearing from the reporting, it sounds like this is something that is beneath the dignity of somebody who has the career and the reputation that Jim Comey has.

[11:20:12] And, you know, he ought to, I think, be focusing on in his post-FBI period, you know, staying above the fray and not getting involved in the name calling and the back and forth that you're talking about today.

BOLDUAN: Senator, let me ask you, on the Russia investigation, Senator Tillis, Republican, of course, pushing a bill to protect special counsel from being fired if the president would go that route. He also said this to "Politico."

I'll read this to you. "The same people who would criticized me for filing this bill would be absolutely angry if I wasn't pounding the table for this bill if we were dealing with Hillary Clinton. So, spare me your righteous indignation." He's talking to Republicans here. Are you with him?

PORTMAN: Well, I'm not one of those people who criticized him. And I do, by the way, believe that it would be a big mistake for the president to fire Mueller and for that matter to fire Rosenstein who would then fire Mueller.

BOLDUAN: A mistake with what kind of ramifications? What would you do if he did?

PORTMAN: Well, first of all, we got to let Mueller finish his investigation. All of the facts where they lead. I do think Mueller is above the fray, by the way, from my earlier conversations about, you know, importance of public service staying above the fray.

But the president has the constitutional right to be able to hire and fire people who work for him. I think as my lawyers have looked at the legislation, you're talking about the Tillis legislation, they believe that it is not consistent with that constitutional right.

It doesn't mean that the president should do it, he should not. But I don't think that there is an easy way for Congress as a legislative branch to step in between a president and an executive branch employee.

I just -- I worked at both ends of Pennsylvania Avenue, I've been on the executive side and legislative side, and our founders did not intend for Congress to be able to intervene in terms of hiring and firing of executive officials.

So, I think that's an issue with the legislation. However, I do think the Congress ought to speak, as I have spoken clearly over time, about this, saying that we ought to let the Mueller investigation proceed, we ought to let him get to the bottom of this issue. The American people want to know, particularly to avoid the Russians and others meddling in our next election, need to know what happened, why it happened, how it can be avoided going forward.

BOLDUAN: And real quick, since it is tax day, of course, you were in Ohio talking about the Republican tax cut yesterday. And that is the message that, of course, Republicans do want to be running on and it would be a beneficial message for them to be running on in 2018.

What do you really think, though, do you really think that it is going to breakthrough when it comes to voters and everything else we have just talked about? The president, he's got his personal attorney facing federal investigation.

He spends much more of his time tweeting about James Comey, the Russia investigation, and a lot of other things than focused on the tax legislation that you all passed.

PORTMAN: Well, look, I wish, you know, all of Washington was more focused on the substantive issues because they really matter. The people I represent, 90 percent of them have been told by the IRS we're going to withhold less of your paycheck because of this tax cut and tax reform bill and they love that.

And they acknowledge it and the proof is in the paycheck. Businesses all over Ohio were telling me this helps us to build our employees and make them more productive by expanding more equipment, more technology.

Yesterday I was at Kroger as you noted, and they had a series of announcements including exciting new continuing education program where people get 3500 bucks a year to get a GED or MBA. They're also putting more in the 401(k).

I'm seeing that all over the country where businesses small and large are responding in a positive way, so I do think that's important to talk about. Not because it is about politics, because it is about substance. I think health care costs are too high.

I think we need to do more in terms of dealing with these international crises we're talking about by having a better plan and better strategy. Those are the things that I would hope we can talk about.

BOLDUAN: Well, and your hope springs eternal, Senator. Let's see what happens. Great to see you. Thank you.

PORTMAN: Thank you for talking about some of those issues today and welcome back.

BOLDUAN: Thank you so much. Thank you.

PORTMAN: Take care.

BOLDUAN: Coming up for us, fired FBI Director James Comey, his new book is out. But he's not reserving criticism of President Trump to just the pages of the tell-all. Coming up, we'll talk to the man who could have replaced Comey at the FBI after that firing, former Senator Joe Lieberman.

Plus, happening right now, Stormy Daniels is speaking out and is about to reveal, what we're told, is a sketch of the person she says threatened her and her daughter. That's ahead.

(COMMERCIAL BREAK)

[11:28:42]

BOLDUAN: All right, we have some breaking news coming in. Stormy Daniels, as we said, would be speaking this hour, she is speaking, has spoken, let's play you a clip.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Earlier this month he broke his silence, denied knowing anything about hush money, where it came from. But let's take a look.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Did you know about the $130,000 payment to Stormy Daniels? Why did Michael Cohen make it if there was no truth to the allegation?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES OF AMERICA: Michael is my attorney. You'll have to ask Michael.

UNIDENTIFIED FEMALE: Do you know where he got the money to make that payment?

PRESIDENT TRUMP: I don't know.

(END VIDEO CLIP)

UNIDENTIFIED FEMALE: So, did this surprise you at all?

STORMY DANIELS: I work in the adult business and I'm a better actor than he is.

MICHAEL AVENATTI, STORMY DANIELS' ATTORNEY: I'll tell you, it shocked me because, you know, it is one thing to be undisciplined in life, another thing to be undisciplined in litigation. When you have a -- you know this, when you have a client that is undisciplined like that, and just spouts off, that's a very dangerous thing.

When he's involved in a lawsuit. And what is ironic to me about this is that's on a Thursday, and on Monday, the attorney told the American people they could ask the questions to, that attorney's office's and home is raided by the FBI. That's a shocking chain of events in a short period of time.

UNIDENTIFIED FEMALE: We want to talk about the physical threat you say was made against you in 2011. Can you remind everyone what you claim happened that day?

DANIELS: Sure, yes.