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Anderson Cooper 360 Degrees

U.S. Marines Target Fallujah; Bush, Kerry Declare Debate Victory; Fox News Bill O'Reilly Sued for Sexual Harrassment; Will Martha Stewart Write Prison Memoir?; Creators of "South Park" Make New Movie

Aired October 14, 2004 - 19:00   ET

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

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


ANDERSON COOPER, HOST: Good evening from New York. I'm Anderson Cooper.
U.S. Marines begin what could be the most difficult fight of the war in Iraq, Target Fallujah. The battle has begun.

360 starts now.

U.S. Marines, locked and loaded, right now launching a major attack on Fallujah. Can they retake this city from the hands of insurgents and Islamic terrorists?

Bush and Kerry both declare debate victory, but who really won? And what do the candidates do now, with 19 days to go before the vote?

Dick Cheney's wife, Lynne, furious at John Kerry for invoking her gay daughter's name. Was he out of line, or are the Republicans overreacting?

Fox News Channel's Bill O'Reilly sued for sexual harassment by his employee. He says it's extortion. She says his frank "falafel" talk went too far.

Is Martha Stewart going to pen a prison memoir? You won't believe how much she could make from a behind-bars tell-all.

And puppets too hot to handle. Tonight we go 360 with the creators of "South Park" and talk about why their new movie almost got an NC-17 rating.

ANNOUNCER: Live from the CNN Broadcast Center in New York, this is ANDERSON COOPER 360.

COOPER: And good evening.

Right now, American Marines are putting themselves in harm's way. An air and ground offensive against a city that's been perhaps ground zero of terror planning in Iraq. The city is Fallujah. A no-go area for American forces for months now.

Across the country today, at least 25 people were killed in attacks by insurgents or in clashes between the militants and U.S. forces. In the most daring strike of all, insurgents detonated bombs inside the green zone. Now, that's the heavily fortified area smack in the center of Baghdad, home to Iraq's interim government and the U.S. embassy, supposedly the safest place in the country. Between five and 10 people were killed in that attack.

Right now in Fallujah, U.S. Marines and Iraqi special forces are conducting a major air and ground offensive.

The latest on that from senior Pentagon correspondent Jamie McIntyre.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT (voice-over): The ground assault was preceded by another round of punishing air strikes aimed at targets in Fallujah believed to be associated with the terrorist network of Abu Musab Zarqawi. Among the targets, safe houses, illegal checkpoints, and weapons storage areas.

Then, after nightfall, hundreds of U.S. Marines, Army soldiers, and Iraqi special forces moved against other objectives in and around the city, according to a Marine with one of the units.

1st LT. LYLE GILBERT, 1ST MARINE EXPEDITIONARY UNIT: The troops crossed the line of departure. We had artillery fire, prep fire going out. Aircraft have been moving through the area all day, helicopters providing transport. It's been a pretty uncomfortable time. We have two battalions out there in maneuver right now dealing with the anti- Iraqi forces, and...

(END VIDEOTAPE)

MCINTYRE: Pentagon officials insist this is not the major final battle to retake Fallujah, although, depending on how the insurgents react, it could turn into something more than it is right now. Currently, it has limited objectives, which is to target various objectives that U.S. intelligence indicates were going to be a base of operation for stepped-up attacks against U.S. forces and Iraqi citizens during the Islamic holy month of Ramadan, Anderson.

COOPER: Jamie, I just want to be very clear. So this is not an attempt to retake the entire city, which, as we know, has been in insurgent and terrorist hands now for months.

MCINTYRE: Well, officials are being cautious about that. They're playing down the expectation. They're saying it's not intended as an operation to retake the entire city. However, part of the idea here seems to be the -- to send a message to the insurgents and see how they react. If, for instance, they were to turn tail and flee, that might change the situation, and the U.S., of course is prepared to take advantage if they have more success than they're anticipating.

COOPER: Well, lot of people are saying Fallujah is like a Taliban-run city at this point, and it will be very interesting to see what success this operation has. Jamie, thanks very much for that. In the presidential race tonight, where the candidate are concerned, today is the first day of the rest of their lives. The debates are over, and up ahead of President Bush and Senator Kerry stretch 19 days of full-bore, all-out campaigning, the sprint at the end of the marathon. And what a marathon it has been. What matters now is stamina and sureness of foot.

As for how they did last night, depends on which poll you look at, and there are a lot of polls. Viewers responding to an ABC News survey found the debate fairly even, Kerry 42, Bush 41, with 14 percent actually calling it a tie, though more Republicans seemed to have been watching ABC than Democrats. But a CNN-"USA Today"-Gallup poll gave the evening to Senator Kerry 52 to 39 percent.

CNN senior political correspondent Candy Crowley is standing by for us with the Kerry campaign, as is, on the president's side, senior White House correspondent John King, with whom we begin. John?

JOHN KING, CNN SENIOR WHITE HOUSE CORRESPONDENT: Anderson, now that the debates are over, the president says the spinners and the pundits have had their say and it's up to the American people. And Mr. Bush says despite recent setbacks, he's confident of victory.

UNIDENTIFIED FEMALE: The president of the United States!

KING: In Nevada, a rousing beginning of the endgame, likability and trust key themes for the president's closing appeal to a divided electorate.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: ... they know my blunt way of speaking. I get that from Mom. They know I sometimes mangle the English language. I get that from Dad. Americans also know I tell you exactly what I'm going to do, and I keep my word.

KING: Stressing leadership will be another constant in the 10- day sprint. The Bush campaign highlighted Senator Kerry's wait-and- see approach when asked about Social Security reform in the final debate, suggesting the Democrat lacks the skills and the courage to confront tough issues.

BUSH: Senator's record is 20 years of out-of-the-mainstream votes without many significant reforms or results.

KING: Optimism can matter in a close race. This rare visit with reporters on Air Force One, Senator John McCain in tow, orchestrated to express nonchalance about all this talk of Kerry momentum and a debate series sweep.

BUSH: I feel great about where we are, because there's a lot of enthusiasm for my candidacy.

KING: Yet the Bush campaign chairman acknowledged this reality. The president was in better shape heading into the debates than he is coming out, making a good start to the final push all the more urgent.

UNIDENTIFIED MALE: And right now, the campaign is all about momentum. It looks like the Bush campaign's going to need to get their momentum on the stump as he travels, (UNINTELLIGIBLE)...

KING: Difficult targeting decisions now loom. Two stops in Nevada Thursday. Mr. Bush won last time, but the state leans a bit toward Kerry now.

(END VIDEOTAPE)

KING: And Mr. Bush is due in here in Oregon in a short time, a big crowd gathered tonight. But most Republicans believe this will be the president's last trip all the way out to the West Coast in another sign of the elector chess under way. The president will go to New Jersey on Monday. That is a state that has been reliably Democratic. The polls are tight. If nothing else, the president wants the Democrats to work harder there.

But Anderson, as of tonight, no plans to make a big New York City media buy to contest New Jersey, the Bush campaign knowing every dollar spent in a long shot like that is a dollar you can't spend in one of those tight battlegrounds, Anderson.

COOPER: And it is very tight indeed. John King, thanks for that.

The challenger, the question is, what now? Trailing badly before debate one, he evened the field. But how does he keep the momentum going? That's the question for his camp. Nineteen days, still plenty of time to either seal the deal or lose it all.

CNN senior political correspondent Candy Crowley reports tonight from the Kerry camp.

(BEGIN VIDEOTAPE)

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice-over): Las Vegas, and all those jabs from the president, got John Kerry thinking about Muhammad Ali.

SEN. JOHN KERRY, DEMOCRATIC PRESIDENTIAL NOMINEE: George...

(END VIDEOTAPE)

COOPER: Well, clearly, have some video problems with that. We'll try to bring that report to you shortly from Candy Crowley.

Seems the nation's biggest sports rivalry couldn't get in the way of some good, old-fashioned carping between candidates. Nielsen rating just released (UNINTELLIGIBLE) show that more than 51 million people watched last night's debate.

Now, that is more than the second debate, but not as much as 62 million who watched the first one. It is a very impressive showing, considering Fox was broadcasting the Yankees against the Red Sox, and that drew 15.2 million viewers.

A record deficit for the federal budget tops our look at what's happening cross-country tonight. Let's take a look. Washington, D.C., the figure is $413 billion. That's the budget shortfall for fiscal year 2004, which ended on September 30. As expected, it is already creating a stir in the presidential race.

Washington, D.C., still, "Stolen Honor" cleared to air. The chairman of the FCC says he doesn't have the authority to stop Sinclair Broadcasting from airing an anti-John Kerry documentary on its 62 TV stations. The agency can only explore the question of equal time after the documentary is broadcast.

Ofaloka (ph), Florida, now, scary moments at a Catholic elementary school. Take a look. More than 100 kids ran in fear after an armed robbery suspect running from police ran inside the school building. The suspect and a second person were arrested. Now, all of the kids were OK.

Cambridge, Massachusetts, a Harvard grad student is sentenced to prison. Alexander Pring (ph) Wilson was convicted of stabbing to death an 18-year-old local Cambridge man who had made fun of him. Pring Wilson claims he acted in self-defense. He received six to eight years behind bars.

That's a look at stories cross-country tonight.

360 next, a cable news star faces some serious charges. We'll hear the accusations against Bill O'Reilly and his response to them. All sides.

Plus, there's something about Mary Cheney. She's not seen much, but her lifestyle is getting a lot of attention in raw politics.

And later, after Martha Stewart is released from pen, or from the pen, I should say, she may start using a pen. Details of a possible megabook deal coming up. A lot of money at stake.

First, let's take a look at your picks, the most popular stories right now on CNN.com.

(COMMERCIAL BREAK)

COOPER: Well, as we mentioned, there are 19 days to go for both candidates. John Kerry got a bounce and momentum from the debates. Question is, can he keep it going?

Again, CNN senior political correspondent Candy Crowley reports tonight from the Kerry camp.

(BEGIN VIDEOTAPE)

CROWLEY (voice-over): Las Vegas, and all those jabs from the president, got John Kerry thinking about Muhammad Ali.

KERRY: George Foreman threw punch after punch, and Ali kind of stepped back and said to Foreman during this, to George Foreman he said, George, is that all you've got? CROWLEY: No knockout punches in the three debates, but the Kerry campaign believes he won all three on points. The upward movement in the polls and the adrenaline high has Kerry on offense. Speaking to seniors who voted before voting was cool, Kerry addressed the annual meeting of the AARP, alternating taunting his opponent...

KERRY: He can spin until he's dizzy, but at the end of day, who, who, who, who...

CROWLEY: ... and belting him.

KERRY: Just the other day, the president's Treasury secretary, his top economic adviser, went to Ohio, where they've lost 235,000 jobs, and he says that the 1.6 million jobs lost in the private sector is just a myth.

Mr. President, the millions of Americans who have lost jobs on your watch are not a myth. They are our neighbors. They are American citizens, they're our friends and families.

CROWLEY: The campaign belongs to the nimble now. Kerry strategists will meet over the weekend to begin plotting the day-by- day game day of political chess, where to send the candidate, where to spend the money.

But even as the candidate travels and the resources move, the target is stable. Kerry aides say the president is concentrating on bringing out his base in huge numbers, while John Kerry will spend his final days reaching out to the middle of the country.

KERRY: And so I say to you, Mr. President, after four years of lost jobs, after four years of families losing health coverage, after four years of falling incomes, is that all you've got? After four years of rising gas prices, rising health care costs, and squeezed families, is that all you've got?

(END VIDEOTAPE)

CROWLEY: About that itinerary, two things you can tell from just today's agenda, that is, where Kerry gave his first speech, in Nevada -- they consider that a battleground state -- where he will give his last speech of the day, here in Des Moines, Iowa, a second battleground state. We will be back to both of them, I'm sure, in the weeks ahead, Anderson.

COOPER: No doubt about that. Candy Crowley, thanks.

Other news now. He is brash, outspoken, and combative, but did Bill O'Reilly push one of his producers too far? The host of cable TV's top-rated news show is accused of forcing an employee to listen to his sex talk. Her lawyers call it sexual harassment. O'Reilly has another word for the accusation, extortion.

CNN's Jason Carroll has details.

(BEGIN VIDEOTAPE) (BEGIN VIDEO CLIP, "REGIS AND KELLY")

REGIS PHILBIN, HOST: Here's Bill O'Reilly!

(END VIDEO CLIP)

JASON CARROLL, CNN CORRESPONDENT (voice-over): Bill O'Reilly on the talk show circuit, promoting his children's book, not an easy task when you're involved in a sexual harassment lawsuit, and having what O'Reilly calls the worst day of your life.

(BEGIN VIDEO CLIP, "REGIS AND KELLY")

O'REILLY: If I have to go down, I'm willing to do it, but I've got to make a stand.

(END VIDEO CLIP)

CARROLL: Making a stand against one of his associate producers, Andrea Mackris, who alleges he sexually harassed her by making repeatedly sexually explicit remarks.

ANDREA MACKRIS, FOX NEWS ASSOCIATE PRODUCER: The last time that I'd spoken to Bill, in -- when this inappropriate conversation had happened the last time, he said it was going to be in person, and I felt extremely threatened for many reasons.

CARROLL: Her complaint alleges that in one phone conversation, O'Reilly fantasized he would basically be in the shower. "I would take that little loofa thing and kinda soap up your back." The rest, too graphic to air.

The language in the complaint is very specific, but Mackris's attorney wouldn't confirm whether there's a recording. O'Reilly's lawyers say none of the actions rise to the level of unlawful activity, and, they say, Mackris's complaint was part of a $60 million extortion attempt. They filed their own suit against Mackris and her attorney.

(BEGIN VIDEO CLIP, "THE O'REILLY FACTOR," FOX NEWS CHANNEL)

O'REILLY: This is the single most evil thing I have ever experienced. And I've seen a lot.

(END VIDEO CLIP)

CARROLL: O'Reilly's legal team says Mackris never complained to Fox human resources about the alleged behavior. Mackris worked at Fox for four years. She left last January for a brief producing stint at CNN, but returned to "The O'Reilly Factor" in July, on condition, her complaint says, "he no longer engaged in inappropriate conduct." But Mackris says the conduct resumed, even though she wrote in an e-mail she was "surrounded by really good, fun people.

(BEGIN VIDEO CLIP)

LESTER HOLT, HOST: Did you write that?

MACKRIS: Yes, I did.

HOLT: And how do you account for that?

MACKRIS: I love my job. I never wanted this to happen.

(END VIDEO CLIP)

(END VIDEOTAPE)

CARROLL: O'Reilly says Mackris's lawsuit is politically motivated, saying her attorney's firm made contributions to the Democratic Party. Mackris's attorney says the extortion complaint is without merit, and his client's complaint is not political, it's sexual harassment, and the allegations against O'Reilly will be proven in court, Anderson.

COOPER: You know, I've read the filing on this, and, I mean, the details are, you know, it's incredibly explicit. I mean, most of it we probably can't even talk about on TV. Have they said whether or not there is a tape recording on this? Because it would seem, when you're reading this, that there's some sort of recording.

CARROLL: Well, the details are very specific. And it's clear that O'Reilly's people, his legal team, believes that there is some sort of a tape, but that is something, at least at this point, that Mackris's people are not willing to confirm.

COOPER: But and the O'Reilly people are not necessarily saying that some of the allegations are not true. They're basically just talking about what they're alleging is extortion.

CARROLL: Exactly. What we have not heard at this point is a firm denial, but what we have heard from O'Reilly's camp is that the allegations are unfounded.

COOPER: All right. We're going to have more on this with Lisa Bloom from Court TV and also Jayne Weintraub, criminal defense attorney, little bit later on 360. Jason, thanks.

That's the topic of today's buzz. What do you think? Do you believe the allegations against Bill O'Reilly are true? Yes or no? Log onto CNN.com/360, cast your vote, result at the end of program.

Coming up next on 360, Lynne Cheney says John Kerry is, quote, "not a good man." Kerry says he was just trying to be positive. A look of the war of words over Cheney's daughter. That is raw politics right ahead.

Also tonight, Martha Stewart's life in prison to be put on the page? Hmm. And a lot of money at stake in that little book.

Also a little later, those "South Park" guys are at it again. We're going to talk with Trey Park (ph) and Matt Stone (ph) about their controversial new movie in the kern (ph). That's a puppet, that's a puppet of Kim Jong Il, in case you're wondering.

All ahead, stay with us.

(COMMERCIAL BREAK)

COOPER: Well, Vice President Dick Cheney and his wife, Lynne, have two daughters. The older daughter, Elizabeth, is married with three kids. The younger daughter, Mary, also has a partner. Hers happens to be another woman.

Now, you know, candidates talk about their kids all the time. But Mary Cheney has tried pretty hard to stay out of the spotlight, though she works for her father's campaign. As we saw last night, though, when politics gets personal, the fallout is classic raw politics.

(BEGIN VIDEOTAPE)

COOPER (voice-over): During the debate yesterday, the candidates were asked if they believed homosexuality is a choice.

KERRY: I think if you were to talk to Dick Cheney's daughter, who is a lesbian, she would tell you that she's being who she was. She's being who she was born as.

COOPER: A comment that drew the ire of the Cheneys.

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: You saw a man who will say and do anything in to get elected.

LYNNE CHENEY, DICK CHENEY'S WIFE: This is not a good man. What a cheap and tawdry political trick.

COOPER: Republicans say John Kerry crossed the line between the personal and the political. Kerry says he was, quote, "trying to say something positive about how strong families deal with this issue." His supporters note that Dick Cheney has talked about his daughter's sexual orientation before.

Mary Cheney works on the campaign but rarely appears in public and seldom gives interviews. She was absent from the Cheney family photo-op at the Republican National Convention, but did appear onstage after her father's recent debate.

This morning, Elizabeth Edwards responded to Lynne Cheney's comments.

(BEGIN AUDIO CLIP, ABC NEWS RADIO)

ELIZABETH EDWARDS, JOHN EDWARDS'S WIFE (on phone): She's overreacted to this and treated it as if it's shameful to have this discussion. I think that it indicates a certain degree of shame with respect to her daughter's sexual preferences.

(END AUDIO CLIP)

COOPER: Her husband also referred to Mary Cheney in last week's debate.

SEN. JOHN EDWARDS, DEMOCRATIC VICE PRESIDENTIAL NOMINEE: And you can't have anything but respect for the fact that they're willing to talk about the fact that they have a gay daughter.

COOPER: And the vice president thanked him afterwards.

Some gay rights activists asked why all this fuss? After all, it's not the first time that candidates mentioned their opponents' children in a debate.

BUSH: Appreciate the fact that his daughters have been so kind to my daughters.

KERRY: And so I acknowledge his daughters. I've watched them. I've chuckled a few times at some of their comments.

COOPER: The difference, of course, Dick Cheney's daughter is gay, and the way candidates and voters may react to that is pure raw politics.

(END VIDEOTAPE)

COOPER: So was Kerry out of line, or within bounds? What do you think? Helping us make sense of the political fallout is "CROSSFIRE" co-host Tucker Carlson and CNN contributor Donna Brazile. I talked to them earlier.

Tucker, the Cheneys have talked about their lesbian daughter before. Why all of the outrage now over John Kerry's comments.

TUCKER CARLSON, CO-HOST, "CROSSFIRE": Well, the question is why did he make them? I mean, they were so awkward. I mean, it goes back to last week, when Senator Edwards, sort of out of nowhere, said, you know, Oh, how's your gay daughter? And then Kerry comes out and says something very similar last night. And the question is, why? And, of course, you know, this being politics, you read into everything the candidates say and (UNINTELLIGIBLE)...

COOPER: Do you think he was reading off some playbook?

TUCKER: ... (UNINTELLIGIBLE)...

I mean, clearly it was planned. Clearly he meant to say that. The question is, why did he mean to say that? His campaign manager comes out today and says, Well, it's fair game. And then John Edwards's wife comes out today and attacks Mrs. Cheney for being ashamed of her gay daughter, as if she could know Mrs. Cheney's state of mind.

It's actually kind of disgusting, and it's weird how the Kerry campaign is digging itself deeper and deeper into this, as if it wants to continue to talk about the sexual preferences of the other guy's daughter. Bizarro.

COOPER: Donna, disgusting and weird, is it? DONNA BRAZILE, CNN CONTRIBUTOR: Well, you know, the Republicans can't have it both ways on this issue. Either they're for gay and lesbian equality, or they're against it.

What Senator Kerry was saying, and I think he said it in a very proud way, was that, you know, Mary Cheney is part of a family, just like many other families who have gay children and gay loved ones. And I don't think in any way he meant to disparage or to, you know, call her out in some awkward way.

TUCKER: (UNINTELLIGIBLE)...

COOPER: But Mary Cheney is a private person, Donna. And, I mean, yes, she's working on her dad's campaign, but she, you know, she's not out making speeches, she's not out get -- putting herself in front of the cameras. Is it right to bring her out in this way?

BRAZILE: Well, look, I would have not brought her out in that way, but I'm not the presidential candidate. I think what Senator Kerry was trying to say that this is not a choice. This is something that every gay and lesbian American lives with. It's something that's inherent. And that's what he was trying to prove that point.

I don't think he was in any way trying to denigrate this young person.

TUCKER: (UNINTELLIGIBLE), let's be honest here. I mean, not everybody has the same attitudes about homosexuality, the same attitudes that, you know, you may have, Donna, or, frankly, that I have. Mary Cheney is a lesbian, you know, great. Not everyone feels that way, at all. And so when you say that out loud in the middle of a political campaign, the understanding is, it's going to turn some people off, to some -- to the extent that they may not vote for you.

It cannot be seen as this context as anything other than a political tactic, and that's what makes it wrong, I think.

BRAZILE: Well, that's why Senator Kerry has spent his entire life fighting for equality for gays and lesbian Americans. And that's why Senator Kerry is opposed to this divisive constitutional amendment that would, you know, once again point out that gays and lesbians are different.

COOPER: Let's move on, let's talk about last night's debate a little bit more.

Tucker, did anyone really hit a home run? Did (UNINTELLIGIBLE) did hat happened last night matter, do you think?

TUCKER: Frankly, you know, brings me no pleasure saying this, but I think the president needed to do much better than he did. And coming on the heels of two debates where he looked the same way, it's not good.

COOPER: Donna, though, his supporters say, Well, you know, look, you know, he may have stumbled on facts here or there, or may have not look as, you know, fluid as Senator Kerry did, but at times he seemed to really speak from the heart, and that resonated with the viewers.

BRAZILE: Well, you know, he's the sitting president. He's the incumbent president. He has a record. And it seemed last night that he was trying to evade his record. I think Senator Kerry not only came across as someone who was presidential, steady, knowledgeable about the facts, but he was able to come across as likable.

COOPER: Donna Brazile, Tucker Carlson, thanks very much.

TUCKER: Thanks.

BRAZILE: Thank you.

COOPER: All of which are subjects that might come up later tonight when my colleague Paula Zahn talks with all-important undecided voters hosting a town hall meeting with some of them tonight.

Paula, where are you at?

PAULA ZAHN, HOST, "PAULA ZAHN NOW": Hi, Anderson. I join you from Bucks County, Pennsylvania, tonight. It is farm country on the banks of the Delaware River between New York City and Philadelphia. It is a deeply divided county in a divided state, in a divided nation, a state that Al Gore took in the year 2000. The latest polls show that it is a dead heat here, or at least it was prior to last night's debate.

Now, tonight about 125 voters, and you're going to meet some of them right now, will join me to put questions to the Kerry campaign and to one of the vice president's daughters, Liz Cheney, and we will cover the gamut from terrorism to the economy to health care and much more. It sort of depends on the questions you all deliver here this evening. So we look forward to hearing from all of them here this evening, Anderson. We will be here at 8:00 at the top of the hour.

COOPER: Always unpredictable, what people are going to ask. Paula, thanks very much.

ZAHN: Thank you.

COOPER: Yaser Hamdi proclaims his innocent. That tops our look at global stories in the uplink.

Hamdi, he's the guy who was held for three years as a enemy combatant in the U.S., well, he spoke to CNN exclusively for his first broadcast interview since his release. He says it is great to be back home in Saudi Arabia. That's him there. And he says he is not bitter about his arrest, claiming that his regained freedom proves his innocence. Hamdi plans to resume his college education and get married. He'd been taken in Afghanistan, held for three years.

Kabul, Afghanistan, now, let every vote be counted. Election officials have begun tallying the ballots from the country's first presidential election. Interim leader Hamid Karzai is expected to win. Voter turnout Saturday was about 75 percent. It's going to take awhile to count all those ballots, though.

Phnom Penh, Cambodia, he can dance, but can he lead? That's the crown prince, Prince Nordam Siamoni (ph), a former ballet dancer and cultural ambassador will succeed his father as Cambodia's king. The country's throne council made the announcement this morning. Siamoni's father stunned Cambodians last week when he announced his retirement because of health problems.

London, England, now, no sex tonight. A new study of a British sexual practice survey shows 1 percent of adults have no interest in sex. Analysts say asexuals are already beginning to show their pride. On one activist Web site, there's a T-shirt for sale with the slogan "Asexuality Is Not Just for Amoebas Any More." Hmm. I don't know, I'm not sure that's going to sweep the country. We'll see.

All right, that's a quick look at tonight's uplink.

Fox News Channel's Bill O'Reilly sued for sexual harassment by his employee. He says it's extortion. She says his frank, falafel talk went too far.

Is Martha Stewart going to pen a prison memoir? You won't believe how much she could make from a behind bars tell-all.

And puppets too hot to handle.

Tonight, we go 360 with the creators of South Park. And talk about why their new movie almost got an NC-17 rating.

(COMMERCIAL BREAK)

COOPER: In the next half hour on 360, cable star Bill O'Reilly faces sexual harassment charges. How big is the case against him? We'll hear the accusations and the countercharges. All side.

Plus, Martha Stewart's days in jail hitting bookshelves? We'll tell you about a possible multimillion dollar book deal.

First, let's check our top story in tonight's "Reset."

In Atlanta, Georgia, the trial of a crematory operator. Remember this story? He was accused of not burning hundreds of corpses. Well, the trial is now on hold. Ray Brent Marsh was scheduled to have his day in court this month, but that likely won't happen because the state supreme court is hearing an appeal of the many criminal charges against him. And there are a bunch. Two-years-ago, 334 decaying bodies were discovered at the Marsh's Tristate crematory.

In Northern California, firefighters are gaining control of a wildfire that has scorched more than 37,000 acres. Favorable weather has helped calmed the fire whose smoke can be seen from the San Francisco Bay Area and that's about 60 miles away. As you can see, they're dropping all sorts of chemicals. Full containment is expected by Saturday night.

In San Juan, Tiger Woods' honeymoon has run into trouble with the law. Woods and his new wife had docked their megayacht in San Juan Harbor without notifying authorities, violating U.S. Maritime Security Laws. It's tough when you have a yacht that big, as Lisa Bloom will attest. They could be fined more than $32,000.

In Lake Windmere, England, the blind leading the blind wind surfing. Take a look at this, a 71-year-old blind wind surfer and his friend, a speed boat driver, who, get this, is also blind -- we should say water skier. I'm mixing up my sports here. The guy driving the boat is also blind. They zipped across the lake at 46.2 miles per hour breaking a world record in waterskiing. I didn't know there were records in waterskiing, but there are. It's been broken.

Bill O'Reilly is one of the most influential broadcasters on cable TV, no doubt about it, with his "The O'Reilly Factor" on Fox news. He also has a daily gig on the radio and a syndicated newspaper column. And he's even got a kid's book out right now that he's promoting, but the print a lot of people are talking about today are the gory details contained in a sexual harassment complaint filed by a member of his staff.

As always on our show, we're covering all the sides. First, here's what she and her lawyers have to say.

(BEGIN VIDEOTAPE)

BENEDICT MORELLI, ATTORNEY FOR ANDREA MACKRIS: Suddenly, without provocation or warning, the defendant, Bill O'Reilly, said to the plaintiff Andrea Mackris quote, "and just use your vibrator to blow off steam" end quote.

During the course of Mr. O'Reilly's telephone monologue on August 2, 2004, he suggested that plaintiff Andrea Mackris purchase a vibrator and name it. And that he had one -- you might have to bleep this, I don't know, shaped like a (EXPLETIVE DELETED) with a little battery in it. That's a quote. That a woman had given him. It became apparent that the defendant was masturbating as he spoke.

ANDREA MACKRIS, FRM. FOX NEWS PRODUCER: The last time that I had spoken to Bill, when this inappropriate conversation had happened the last time, he said it was going to be in person. And I felt extremely threatened for many reasons.

(END VIDEOTAPE)

COOPER: Anyone who has ever tuned in to "The O'Reilly Factor" knows Bill O'Reilly is certainly not a pushover. Here's what he had to say.

(BEGIN VIDEOTAPE)

BILL O'REILLY, FOX NEWS ANCHOR: So, this morning I had to file a lawsuit against people demanding $60 million or they will, quote, punish me and Fox News. $60 million. I really can't say anything else. I don't want to waste your time with this. The justice system has the case. We'll see what happens. But in the end, you should know this is all about hurting me and the Fox News Channel. I knew by filing this lawsuit I was going to perhaps ruin my career and I knew the wild stuff would be in the papers, because the papers love that, you know how it goes. But all of us are targets. You know that. We're all targets. Every famous person in this country is a target.

And for the last 5 years I've had threats almost on a daily basis, we're going to kill you, we're going to get your family. I'm going to sue you for this, or that and the other thing. And a short time ago, this came in to Fox and they want $60 million. Now just think about that. The 9/11 families didn't get anywhere near that.

This is the single most evil thing I have ever experienced.

(END VIDEOTAPE)

COOPER: Covering the case for us, Court TV anchor Lisa Bloom. And from Miami, defense attorney Jayne Weintraub. And by the way, both have appeared on "The O'Reilly Factor."

Appreciate both of you joining us tonight.

Lisa, I want to start off with you. And I want to read an except from the lawsuit. It's actually hard to find a lot of excerpts you can read from this lawsuit, because so many of them are quite gory and very specific. But anyway, here's one that we can read. It's not going to shock anyone.

This person said -- O'Reilly is alleged to say, quote, "I'll rake her through the mud," talking about any woman who might bring up sexual harassment charges against him. Quote, "I'll rake her through the mud. Bring up things in her life. And I'll make her so miserable that she'll be destroyed and nobody would believe her. It would be her word against mine and who are they going to believe, me or some unstable woman making outrageous accusations." This is allegedly something he said to this woman who is now suing him.

LISA BLOOM, COURT TV: Right. And that's in her complaint, I think, to help explain why this went on for a couple of years before she complained. O'Reilly does have a reputation for being somewhat volatile, others have complained, like Al Franken, that they were targets of retaliation when they made claims against him. That's why I think that's in the complaint.

But Anderson, I've got to tell you, if this woman has tapes and the complaint I think strongly indicates that she does by doing long block quotes from O'Reilly, including -- and doing uh, and um, as through it's transcribed directly from a tape, this is going to be a very significant factor for O'Reilly.

COOPER: Jayne, let me read to you about another thing from this thing. And I want to talk more about whether or not she does have tapes. And if she does, why they haven't come out and said this. This is another excerpt from the lawsuit. It's an alleged, I guess, phone sex conversation again, part of it, the part that we can read. Quote, "you still would be with your back to me, then I would kind of put my arm into one of those mitts, those loofa mitts, you know, so I got my hands in it, and I would put it around your front, kind of rub your tummy a little bit with it." And we're going to end it there, because it goes on talking about falafels and stuff, which I don't really understand.

Why, if this woman has the tape, why haven't they come forward with it?

JAYNE WEINTRAUB, DEFENSE ATTORNEY: Well, that's a very good question. And I would like to hear the answer to that by Ben Morelli, myself, the lawyer who filed it.

BLOOM: They don't have to. They're not in discovery yet, that's why.

WEINTRAUB: Lisa, you know what? This is a real disservice to sexual harassment victims of any sort walking around. First of all, let's look at the facts here. This woman worked for Fox, and alleges that these all happened to her. She felt trapped. She was so threatened and scared. Why didn't she just hang up? Why didn't she quite? Why didn't she leave? Why didn't she complain? Why didn't she do anything? Even if he did the things she claims, $60 million? What is going to in this country with our justice system? This is not justice...

BLOOM: You know what the answer to that is, Sandy. Women are not required to leave their jobs. Guess what? We can keep our jobs and insist that we not be sexually harassed.

WEINTRAUB: Why didn't she make a complaint about it? Why did she go back to work for him?

BLOOM: Let me tell you, you expect this woman to make a complaint on her own against Bill O'Reilly, one of the biggest stars at Fox News. She hired an attorney to do it on her behalf. That was appropriate.

WEINTRAUB: What are the damages here. I'm sorry, Anderson. What are the damages, $60 million. Even if he did what she claims where does she come off asking for 60 million damages. I say kudos to Bill O'Reilly for having the courage to stand up as a celebrity and say I'm not going to be blackmailed and I'm not going to hush this under the rug.

BLOOM: ...in the way that it's alleged in this complaint talking about graphic explicit activities.

WEINTRAUB: Lisa, why (UNINTELLIGIBLE) having this conversation?

BLOOM: ...including sexual intercourse. Why would you give kudos to someone like that. If she demanded $60 million it was to avoid filing the lawsuit.

WEINTRAUB: Because she's an adult. Why did she have these conversations?

BLOOM: ...they said no, the lawsuit has now been filed. The difference is if they threatened to go public without the 60 million being paid that could be extortion...

COOPER: So the line between extortion and asking for money is what?

BLOOM: If you say I'm going to file a lawsuit unless you pay me X dollars, not extortion. That's just pretrial settlement talk, happens every day of the week. If you say unless you pay me X dollars I will expose you, I will go public that very well could be extortion. If her attorney did that, that was an error on his part.

WEINTRAUB: We know her attorney very well, you and I, we were both on a TV show with him...

BLOOM: Outstanding trial attorney.

WEINTRAUB: He has quite a theatrical flair. She e-mailed one of her best friends last month.

And she said...

COOPER: I'm not sure theatrical is all that bad.

A little sensitive for you both right there.

WEINTRAUB: She e-mailed her friend and she was saying she was happy. She loved the job and couldn't be happier. She's home again and never leaving and that's working for Bill O'Reilly.

BLOOM: She's got a tape of these comments by Bill O'Reilly of the explicit behavior he wants to engage. It's over for him if she really has that on tape.

WEINTRAUB: I think she has to take some sort of responsibility.

BLOOM: She has to take responsibility for the comments he made?

WEINTRAUB: Lisa, you don't know what she was saying to him!

COOPER: Is it all one-sided at this point? All of these details. Anybody can be sued these days. All of us can be sued.

BLOOM: You can be sued but there's got to be some evidence. If she's got a tape of these comments his only defense is that she was encouraging in it.

COOPER: It is completely one-sided. The transcripts and the tapes are all from her.

BLOOM: That's true because I'm sure Bill O'Reilly wasn't taping conversations where he's making sexually explicit comments to his employee. Let's see if he has tapes of these alleged extortion comments. Bill O'Reilly to make these comments when he's being taped not the smartest move on his part.

WEINTRAUB: In Florida, it would be illegal to tape record those conversations. I don't know if it is in New York, but in Florida that would be an illegal act.

BLOOM: Do you think she'll get prosecuted for taping, forget about it.

COOPER: Let's leave it there. Thank you very much.

The topic for today's buzz. What do you think? Do you believe the allegations against Bill O'Reilly are true? Yes or no. Log on to CNN.com/360. Cast your vote.

Martha Stewart's prison sentence may end with a book tour. Everybody's got books these days. Reports that the convicted home maven could be working on a memoir of her life as an inmate.

Later, puppet masters the "South Park" way. We like to look at all different stories. The guys behind the show "South Park" stopped by to talk about their strange new controversial movie.

(COMMERCIAL BREAK)

COOPER: When Martha Stewart entered prison six days ago, she was allowed to keep her toothbrush, her earrings and a keen business sense. With word of a memoir in the works, Stewart's return to freedom may include a few tips on living without it. CNN's Mary Snow has details.

(BEGIN VIDEOTAPE)

MARY SNOW, CNN CORRESPONDENT (voice-over): It's not exactly the kind of home the domestic guru had in mind when she built her fortune, but Martha Stewart's time in the big house in Alderson, West Virginia, could be part of a book on her life. A person familiar with the situation says Stewart is interested in an autobiography at some point and there have been preliminary talks among her lawyers and publishers. The Stewart camp denies a report that she plans to write a prison memoir, but Stewart did tell Larry King she wanted to write a book shortly after she was sentenced.

MARTHA STEWART: I think I'll write a book because I think it could be helpful to other people just about -- just about what to choose, how to behave, how to attend an interview. There's things that -- there's no how-to book about this.

SNOW: Stewart's stretch beyond how-to domestic tips could prove to be a challenge since publishing insiders say personal details equal dollars. An early reaction on the street of Stewart writing a book is getting mixed views.

UNIDENTIFIED MALE: I'm sure there will be one passage in there about how she baked cookies for everyone in prison and how everyone loved her as a result, but other than that, I don't think I'd read it cover to cover.

UNIDENTIFIED FEMALE: I'd like to know what she's thinking and how she's passing the time whether she's reading, whether she's dreaming up new recipes or what kind of creative processes are going through her mind.

(END VIDEOTAPE)

SNOW: The big question is how much would a book about Martha Stewart written by Martha Stewart be worth? "New York Magazine" says a prison memoir alone could fetch as much as $5 million, but industry insiders say that's way too high and Stewart's people say it's way too early to be talking money.

COOPER: Mary Snow, thanks very much.

Next on 360 from South Park to a theater near you. The cartoon creators have a new puppet movie out. It offends just about everyone, the U.N., the White House, anyone you can possibly think, I think even Sean Penn. Don't expect it to be cute and cuddly, though. We'll talk about it with the creators of "South Park."

(COMMERCIAL BREAK)

COOPER: In tonight's pop culture current, two men who proved beyond any doubts that their animated characters may not be all sweetness and light, but can in fact be shocking, foul-mouthed little (UNINTELLIGIBLE). The men who wrote the movie "Team America" are currently doing for puppets on the big screen what they did for cartoon kids on "South Park," making them offensive and funny. Earlier I spoke to them about the controversy surrounding the move.

(BEGIN VIDEOTAPE)

COOPER: You've been getting a lot of flack already, I guess that's to be anticipated. What do you make of all the flack?

TREY PARKER, PRODUCER/CREATOR, "TEAM AMERICA": We're excited that we made a movie where we pissed off the White House and Sean Penn. We think that's quite an accomplishment.

COOPER: When you accomplish that it's pretty remarkable.

The White House say this film is anti-Bush. You say what?

MATT STONE, "TEAM AMERICA": We set out to do something about America and about, like what it's been like for us as Americans the last three or four years and about all of the confusing things and all of the confusing voices whether it's from celebrity actors or from Muslim terrorists.

COOPER: Is it OK to make fun of the war on terror?

PARKER: We deal with everything with comedy and I know if one of us got cancer tomorrow we'd be making jokes about it.

Humor is how we analyze things.

COOPER: Let's take a look at a clip of Kim Jong Il from the film.

UNIDENTIFIED MALE: Hans Blix? Oh, no!

UNIDENTIFIED MALE: Hello, great to see you!

UNIDENTIFIED MALE: Mr. Il, I was supposed to be allowed to inspect your palace today and your guards won't let me into certain areas.

UNIDENTIFIED MALE: We've been through this a dozen times. I don't have any weapons of mass destruction, OK!

UNIDENTIFIED MALE: Then let me look around so I can ease the U.N.'s collective minds. I'm sorry, but the U.N. must be firm with you. Let me see your whole palace or else?

UNIDENTIFIED MALE: Or else what?

UNIDENTIFIED MALE: Or else you will be very, angry with you and we will write you a letter telling you how angry we are.

(END VIDEOTAPE)

PARKER: That's about the only G-rated 60 seconds of the entire movie.

COOPER: I have to ask you about that. You're going to have an NC-17 movie because of puppet sex or marionette sex.

PARKER: We didn't make anatomically correct puppets and we just did all these different positions and they came back with an NC-17 and said they can do this and not this and they can't do that.

STONE: They said we could only have missionary and her on top, but that's not really a joke. That's normal life. That's a normal night.

PARKER: That's normal puppet sex.

COOPER: What is the rating now, R?

PARKER: We had to cut the sex scenes from two minutes long to a minute.

COOPER: It's a hard R. Everyone asks me, should I take my 13- year-old?

STONE: It's a filthy movie.

PARKER: It's an adult movie.

COOPER: So you don't want little kids going to this movie.

PARKER: That wouldn't be very cool.

COOPER: Sean Penn doesn't think this movie is cool either. I guess he's one of the characters in your movie unbeknownst to him.

I guess he says you're discouraging people from voting. He said this, quote, "it's all well to joke about me or whomever you choose, not so well to encourage irresponsibility that will ultimately lead to the disembowelment, mutilation, exploitation and death of innocent people throughout the world. The vote matters to them. No one's ignorance, including a couple of hip cross-dressers is an excuse."

I guess the hip cross-dressers would be you guys.

STONE: We were quoted in "Rolling Stone" talking about how we thought that encouraging uninformed voters to vote wasn't...

PARKER: Just go vote not go get informed. We were talking about vote or die, just vote or I'll kill you.

STONE: For us it was like if those kinds of campaigns were get involved to get aware and make a decision to be part of the democratic process, but to shame people -- to shame people who don't know what's going on in the world and voting we just don't think that...

PARKER: Especially because he was just made -- he is just mad that we're making fun of him, how dare we make fun of him and that we had him eaten by a panther in our movie.

COOPER: I look forward to the movie and you guys are incredibly great and we appreciate you being here.

(END VIDEOTAPE)

COOPER: We'll be right back, plus tomorrow we'll talk with Hollywood madam Heidi Fleiss. She'll give us some insight into what Martha Stewart is facing in prison. Should be interesting. First today's buzz, do you believe the allegations against Bill O'Reilly are true? Yes or no. Log on to CNN.com/360. Cast your vote. Results when we come back.

(COMMERCIAL BREAK)

COOPER: Tonight taking anticlaim to the Nth Degree. I don't know about you, but we here keenly feel what we call PDL, post debate letdown. That's it. It's all over. No more face-offs and so many questions we hoped would be asked but never were nor now ever will be.

For instance, Mr. President, we read that one of your favorite activities there at the ranch in Crawford is clearing brush. What's that about? You actually like dragging stumps and tree branches around, why?

Mr. Kerry, why is there a right turn on red in some states and not in others? Doesn't that drive you nuts?

Mr. Bush, do you get unsolicited calls from telemarketers in the middle of dinner? Ever been offered a free Florida vacation or asked if you're satisfied with your current long distance carrier? How very sad. Neither man ever was asked do you think Martha got what was coming to her or raw deal.

Now we'll never know. I'm Anderson Cooper. Thanks for watching 360. Coming up next, "PAULA ZAHN NOW."

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


Aired October 14, 2004 - 19:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANDERSON COOPER, HOST: Good evening from New York. I'm Anderson Cooper.
U.S. Marines begin what could be the most difficult fight of the war in Iraq, Target Fallujah. The battle has begun.

360 starts now.

U.S. Marines, locked and loaded, right now launching a major attack on Fallujah. Can they retake this city from the hands of insurgents and Islamic terrorists?

Bush and Kerry both declare debate victory, but who really won? And what do the candidates do now, with 19 days to go before the vote?

Dick Cheney's wife, Lynne, furious at John Kerry for invoking her gay daughter's name. Was he out of line, or are the Republicans overreacting?

Fox News Channel's Bill O'Reilly sued for sexual harassment by his employee. He says it's extortion. She says his frank "falafel" talk went too far.

Is Martha Stewart going to pen a prison memoir? You won't believe how much she could make from a behind-bars tell-all.

And puppets too hot to handle. Tonight we go 360 with the creators of "South Park" and talk about why their new movie almost got an NC-17 rating.

ANNOUNCER: Live from the CNN Broadcast Center in New York, this is ANDERSON COOPER 360.

COOPER: And good evening.

Right now, American Marines are putting themselves in harm's way. An air and ground offensive against a city that's been perhaps ground zero of terror planning in Iraq. The city is Fallujah. A no-go area for American forces for months now.

Across the country today, at least 25 people were killed in attacks by insurgents or in clashes between the militants and U.S. forces. In the most daring strike of all, insurgents detonated bombs inside the green zone. Now, that's the heavily fortified area smack in the center of Baghdad, home to Iraq's interim government and the U.S. embassy, supposedly the safest place in the country. Between five and 10 people were killed in that attack.

Right now in Fallujah, U.S. Marines and Iraqi special forces are conducting a major air and ground offensive.

The latest on that from senior Pentagon correspondent Jamie McIntyre.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT (voice-over): The ground assault was preceded by another round of punishing air strikes aimed at targets in Fallujah believed to be associated with the terrorist network of Abu Musab Zarqawi. Among the targets, safe houses, illegal checkpoints, and weapons storage areas.

Then, after nightfall, hundreds of U.S. Marines, Army soldiers, and Iraqi special forces moved against other objectives in and around the city, according to a Marine with one of the units.

1st LT. LYLE GILBERT, 1ST MARINE EXPEDITIONARY UNIT: The troops crossed the line of departure. We had artillery fire, prep fire going out. Aircraft have been moving through the area all day, helicopters providing transport. It's been a pretty uncomfortable time. We have two battalions out there in maneuver right now dealing with the anti- Iraqi forces, and...

(END VIDEOTAPE)

MCINTYRE: Pentagon officials insist this is not the major final battle to retake Fallujah, although, depending on how the insurgents react, it could turn into something more than it is right now. Currently, it has limited objectives, which is to target various objectives that U.S. intelligence indicates were going to be a base of operation for stepped-up attacks against U.S. forces and Iraqi citizens during the Islamic holy month of Ramadan, Anderson.

COOPER: Jamie, I just want to be very clear. So this is not an attempt to retake the entire city, which, as we know, has been in insurgent and terrorist hands now for months.

MCINTYRE: Well, officials are being cautious about that. They're playing down the expectation. They're saying it's not intended as an operation to retake the entire city. However, part of the idea here seems to be the -- to send a message to the insurgents and see how they react. If, for instance, they were to turn tail and flee, that might change the situation, and the U.S., of course is prepared to take advantage if they have more success than they're anticipating.

COOPER: Well, lot of people are saying Fallujah is like a Taliban-run city at this point, and it will be very interesting to see what success this operation has. Jamie, thanks very much for that. In the presidential race tonight, where the candidate are concerned, today is the first day of the rest of their lives. The debates are over, and up ahead of President Bush and Senator Kerry stretch 19 days of full-bore, all-out campaigning, the sprint at the end of the marathon. And what a marathon it has been. What matters now is stamina and sureness of foot.

As for how they did last night, depends on which poll you look at, and there are a lot of polls. Viewers responding to an ABC News survey found the debate fairly even, Kerry 42, Bush 41, with 14 percent actually calling it a tie, though more Republicans seemed to have been watching ABC than Democrats. But a CNN-"USA Today"-Gallup poll gave the evening to Senator Kerry 52 to 39 percent.

CNN senior political correspondent Candy Crowley is standing by for us with the Kerry campaign, as is, on the president's side, senior White House correspondent John King, with whom we begin. John?

JOHN KING, CNN SENIOR WHITE HOUSE CORRESPONDENT: Anderson, now that the debates are over, the president says the spinners and the pundits have had their say and it's up to the American people. And Mr. Bush says despite recent setbacks, he's confident of victory.

UNIDENTIFIED FEMALE: The president of the United States!

KING: In Nevada, a rousing beginning of the endgame, likability and trust key themes for the president's closing appeal to a divided electorate.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: ... they know my blunt way of speaking. I get that from Mom. They know I sometimes mangle the English language. I get that from Dad. Americans also know I tell you exactly what I'm going to do, and I keep my word.

KING: Stressing leadership will be another constant in the 10- day sprint. The Bush campaign highlighted Senator Kerry's wait-and- see approach when asked about Social Security reform in the final debate, suggesting the Democrat lacks the skills and the courage to confront tough issues.

BUSH: Senator's record is 20 years of out-of-the-mainstream votes without many significant reforms or results.

KING: Optimism can matter in a close race. This rare visit with reporters on Air Force One, Senator John McCain in tow, orchestrated to express nonchalance about all this talk of Kerry momentum and a debate series sweep.

BUSH: I feel great about where we are, because there's a lot of enthusiasm for my candidacy.

KING: Yet the Bush campaign chairman acknowledged this reality. The president was in better shape heading into the debates than he is coming out, making a good start to the final push all the more urgent.

UNIDENTIFIED MALE: And right now, the campaign is all about momentum. It looks like the Bush campaign's going to need to get their momentum on the stump as he travels, (UNINTELLIGIBLE)...

KING: Difficult targeting decisions now loom. Two stops in Nevada Thursday. Mr. Bush won last time, but the state leans a bit toward Kerry now.

(END VIDEOTAPE)

KING: And Mr. Bush is due in here in Oregon in a short time, a big crowd gathered tonight. But most Republicans believe this will be the president's last trip all the way out to the West Coast in another sign of the elector chess under way. The president will go to New Jersey on Monday. That is a state that has been reliably Democratic. The polls are tight. If nothing else, the president wants the Democrats to work harder there.

But Anderson, as of tonight, no plans to make a big New York City media buy to contest New Jersey, the Bush campaign knowing every dollar spent in a long shot like that is a dollar you can't spend in one of those tight battlegrounds, Anderson.

COOPER: And it is very tight indeed. John King, thanks for that.

The challenger, the question is, what now? Trailing badly before debate one, he evened the field. But how does he keep the momentum going? That's the question for his camp. Nineteen days, still plenty of time to either seal the deal or lose it all.

CNN senior political correspondent Candy Crowley reports tonight from the Kerry camp.

(BEGIN VIDEOTAPE)

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice-over): Las Vegas, and all those jabs from the president, got John Kerry thinking about Muhammad Ali.

SEN. JOHN KERRY, DEMOCRATIC PRESIDENTIAL NOMINEE: George...

(END VIDEOTAPE)

COOPER: Well, clearly, have some video problems with that. We'll try to bring that report to you shortly from Candy Crowley.

Seems the nation's biggest sports rivalry couldn't get in the way of some good, old-fashioned carping between candidates. Nielsen rating just released (UNINTELLIGIBLE) show that more than 51 million people watched last night's debate.

Now, that is more than the second debate, but not as much as 62 million who watched the first one. It is a very impressive showing, considering Fox was broadcasting the Yankees against the Red Sox, and that drew 15.2 million viewers.

A record deficit for the federal budget tops our look at what's happening cross-country tonight. Let's take a look. Washington, D.C., the figure is $413 billion. That's the budget shortfall for fiscal year 2004, which ended on September 30. As expected, it is already creating a stir in the presidential race.

Washington, D.C., still, "Stolen Honor" cleared to air. The chairman of the FCC says he doesn't have the authority to stop Sinclair Broadcasting from airing an anti-John Kerry documentary on its 62 TV stations. The agency can only explore the question of equal time after the documentary is broadcast.

Ofaloka (ph), Florida, now, scary moments at a Catholic elementary school. Take a look. More than 100 kids ran in fear after an armed robbery suspect running from police ran inside the school building. The suspect and a second person were arrested. Now, all of the kids were OK.

Cambridge, Massachusetts, a Harvard grad student is sentenced to prison. Alexander Pring (ph) Wilson was convicted of stabbing to death an 18-year-old local Cambridge man who had made fun of him. Pring Wilson claims he acted in self-defense. He received six to eight years behind bars.

That's a look at stories cross-country tonight.

360 next, a cable news star faces some serious charges. We'll hear the accusations against Bill O'Reilly and his response to them. All sides.

Plus, there's something about Mary Cheney. She's not seen much, but her lifestyle is getting a lot of attention in raw politics.

And later, after Martha Stewart is released from pen, or from the pen, I should say, she may start using a pen. Details of a possible megabook deal coming up. A lot of money at stake.

First, let's take a look at your picks, the most popular stories right now on CNN.com.

(COMMERCIAL BREAK)

COOPER: Well, as we mentioned, there are 19 days to go for both candidates. John Kerry got a bounce and momentum from the debates. Question is, can he keep it going?

Again, CNN senior political correspondent Candy Crowley reports tonight from the Kerry camp.

(BEGIN VIDEOTAPE)

CROWLEY (voice-over): Las Vegas, and all those jabs from the president, got John Kerry thinking about Muhammad Ali.

KERRY: George Foreman threw punch after punch, and Ali kind of stepped back and said to Foreman during this, to George Foreman he said, George, is that all you've got? CROWLEY: No knockout punches in the three debates, but the Kerry campaign believes he won all three on points. The upward movement in the polls and the adrenaline high has Kerry on offense. Speaking to seniors who voted before voting was cool, Kerry addressed the annual meeting of the AARP, alternating taunting his opponent...

KERRY: He can spin until he's dizzy, but at the end of day, who, who, who, who...

CROWLEY: ... and belting him.

KERRY: Just the other day, the president's Treasury secretary, his top economic adviser, went to Ohio, where they've lost 235,000 jobs, and he says that the 1.6 million jobs lost in the private sector is just a myth.

Mr. President, the millions of Americans who have lost jobs on your watch are not a myth. They are our neighbors. They are American citizens, they're our friends and families.

CROWLEY: The campaign belongs to the nimble now. Kerry strategists will meet over the weekend to begin plotting the day-by- day game day of political chess, where to send the candidate, where to spend the money.

But even as the candidate travels and the resources move, the target is stable. Kerry aides say the president is concentrating on bringing out his base in huge numbers, while John Kerry will spend his final days reaching out to the middle of the country.

KERRY: And so I say to you, Mr. President, after four years of lost jobs, after four years of families losing health coverage, after four years of falling incomes, is that all you've got? After four years of rising gas prices, rising health care costs, and squeezed families, is that all you've got?

(END VIDEOTAPE)

CROWLEY: About that itinerary, two things you can tell from just today's agenda, that is, where Kerry gave his first speech, in Nevada -- they consider that a battleground state -- where he will give his last speech of the day, here in Des Moines, Iowa, a second battleground state. We will be back to both of them, I'm sure, in the weeks ahead, Anderson.

COOPER: No doubt about that. Candy Crowley, thanks.

Other news now. He is brash, outspoken, and combative, but did Bill O'Reilly push one of his producers too far? The host of cable TV's top-rated news show is accused of forcing an employee to listen to his sex talk. Her lawyers call it sexual harassment. O'Reilly has another word for the accusation, extortion.

CNN's Jason Carroll has details.

(BEGIN VIDEOTAPE) (BEGIN VIDEO CLIP, "REGIS AND KELLY")

REGIS PHILBIN, HOST: Here's Bill O'Reilly!

(END VIDEO CLIP)

JASON CARROLL, CNN CORRESPONDENT (voice-over): Bill O'Reilly on the talk show circuit, promoting his children's book, not an easy task when you're involved in a sexual harassment lawsuit, and having what O'Reilly calls the worst day of your life.

(BEGIN VIDEO CLIP, "REGIS AND KELLY")

O'REILLY: If I have to go down, I'm willing to do it, but I've got to make a stand.

(END VIDEO CLIP)

CARROLL: Making a stand against one of his associate producers, Andrea Mackris, who alleges he sexually harassed her by making repeatedly sexually explicit remarks.

ANDREA MACKRIS, FOX NEWS ASSOCIATE PRODUCER: The last time that I'd spoken to Bill, in -- when this inappropriate conversation had happened the last time, he said it was going to be in person, and I felt extremely threatened for many reasons.

CARROLL: Her complaint alleges that in one phone conversation, O'Reilly fantasized he would basically be in the shower. "I would take that little loofa thing and kinda soap up your back." The rest, too graphic to air.

The language in the complaint is very specific, but Mackris's attorney wouldn't confirm whether there's a recording. O'Reilly's lawyers say none of the actions rise to the level of unlawful activity, and, they say, Mackris's complaint was part of a $60 million extortion attempt. They filed their own suit against Mackris and her attorney.

(BEGIN VIDEO CLIP, "THE O'REILLY FACTOR," FOX NEWS CHANNEL)

O'REILLY: This is the single most evil thing I have ever experienced. And I've seen a lot.

(END VIDEO CLIP)

CARROLL: O'Reilly's legal team says Mackris never complained to Fox human resources about the alleged behavior. Mackris worked at Fox for four years. She left last January for a brief producing stint at CNN, but returned to "The O'Reilly Factor" in July, on condition, her complaint says, "he no longer engaged in inappropriate conduct." But Mackris says the conduct resumed, even though she wrote in an e-mail she was "surrounded by really good, fun people.

(BEGIN VIDEO CLIP)

LESTER HOLT, HOST: Did you write that?

MACKRIS: Yes, I did.

HOLT: And how do you account for that?

MACKRIS: I love my job. I never wanted this to happen.

(END VIDEO CLIP)

(END VIDEOTAPE)

CARROLL: O'Reilly says Mackris's lawsuit is politically motivated, saying her attorney's firm made contributions to the Democratic Party. Mackris's attorney says the extortion complaint is without merit, and his client's complaint is not political, it's sexual harassment, and the allegations against O'Reilly will be proven in court, Anderson.

COOPER: You know, I've read the filing on this, and, I mean, the details are, you know, it's incredibly explicit. I mean, most of it we probably can't even talk about on TV. Have they said whether or not there is a tape recording on this? Because it would seem, when you're reading this, that there's some sort of recording.

CARROLL: Well, the details are very specific. And it's clear that O'Reilly's people, his legal team, believes that there is some sort of a tape, but that is something, at least at this point, that Mackris's people are not willing to confirm.

COOPER: But and the O'Reilly people are not necessarily saying that some of the allegations are not true. They're basically just talking about what they're alleging is extortion.

CARROLL: Exactly. What we have not heard at this point is a firm denial, but what we have heard from O'Reilly's camp is that the allegations are unfounded.

COOPER: All right. We're going to have more on this with Lisa Bloom from Court TV and also Jayne Weintraub, criminal defense attorney, little bit later on 360. Jason, thanks.

That's the topic of today's buzz. What do you think? Do you believe the allegations against Bill O'Reilly are true? Yes or no? Log onto CNN.com/360, cast your vote, result at the end of program.

Coming up next on 360, Lynne Cheney says John Kerry is, quote, "not a good man." Kerry says he was just trying to be positive. A look of the war of words over Cheney's daughter. That is raw politics right ahead.

Also tonight, Martha Stewart's life in prison to be put on the page? Hmm. And a lot of money at stake in that little book.

Also a little later, those "South Park" guys are at it again. We're going to talk with Trey Park (ph) and Matt Stone (ph) about their controversial new movie in the kern (ph). That's a puppet, that's a puppet of Kim Jong Il, in case you're wondering.

All ahead, stay with us.

(COMMERCIAL BREAK)

COOPER: Well, Vice President Dick Cheney and his wife, Lynne, have two daughters. The older daughter, Elizabeth, is married with three kids. The younger daughter, Mary, also has a partner. Hers happens to be another woman.

Now, you know, candidates talk about their kids all the time. But Mary Cheney has tried pretty hard to stay out of the spotlight, though she works for her father's campaign. As we saw last night, though, when politics gets personal, the fallout is classic raw politics.

(BEGIN VIDEOTAPE)

COOPER (voice-over): During the debate yesterday, the candidates were asked if they believed homosexuality is a choice.

KERRY: I think if you were to talk to Dick Cheney's daughter, who is a lesbian, she would tell you that she's being who she was. She's being who she was born as.

COOPER: A comment that drew the ire of the Cheneys.

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: You saw a man who will say and do anything in to get elected.

LYNNE CHENEY, DICK CHENEY'S WIFE: This is not a good man. What a cheap and tawdry political trick.

COOPER: Republicans say John Kerry crossed the line between the personal and the political. Kerry says he was, quote, "trying to say something positive about how strong families deal with this issue." His supporters note that Dick Cheney has talked about his daughter's sexual orientation before.

Mary Cheney works on the campaign but rarely appears in public and seldom gives interviews. She was absent from the Cheney family photo-op at the Republican National Convention, but did appear onstage after her father's recent debate.

This morning, Elizabeth Edwards responded to Lynne Cheney's comments.

(BEGIN AUDIO CLIP, ABC NEWS RADIO)

ELIZABETH EDWARDS, JOHN EDWARDS'S WIFE (on phone): She's overreacted to this and treated it as if it's shameful to have this discussion. I think that it indicates a certain degree of shame with respect to her daughter's sexual preferences.

(END AUDIO CLIP)

COOPER: Her husband also referred to Mary Cheney in last week's debate.

SEN. JOHN EDWARDS, DEMOCRATIC VICE PRESIDENTIAL NOMINEE: And you can't have anything but respect for the fact that they're willing to talk about the fact that they have a gay daughter.

COOPER: And the vice president thanked him afterwards.

Some gay rights activists asked why all this fuss? After all, it's not the first time that candidates mentioned their opponents' children in a debate.

BUSH: Appreciate the fact that his daughters have been so kind to my daughters.

KERRY: And so I acknowledge his daughters. I've watched them. I've chuckled a few times at some of their comments.

COOPER: The difference, of course, Dick Cheney's daughter is gay, and the way candidates and voters may react to that is pure raw politics.

(END VIDEOTAPE)

COOPER: So was Kerry out of line, or within bounds? What do you think? Helping us make sense of the political fallout is "CROSSFIRE" co-host Tucker Carlson and CNN contributor Donna Brazile. I talked to them earlier.

Tucker, the Cheneys have talked about their lesbian daughter before. Why all of the outrage now over John Kerry's comments.

TUCKER CARLSON, CO-HOST, "CROSSFIRE": Well, the question is why did he make them? I mean, they were so awkward. I mean, it goes back to last week, when Senator Edwards, sort of out of nowhere, said, you know, Oh, how's your gay daughter? And then Kerry comes out and says something very similar last night. And the question is, why? And, of course, you know, this being politics, you read into everything the candidates say and (UNINTELLIGIBLE)...

COOPER: Do you think he was reading off some playbook?

TUCKER: ... (UNINTELLIGIBLE)...

I mean, clearly it was planned. Clearly he meant to say that. The question is, why did he mean to say that? His campaign manager comes out today and says, Well, it's fair game. And then John Edwards's wife comes out today and attacks Mrs. Cheney for being ashamed of her gay daughter, as if she could know Mrs. Cheney's state of mind.

It's actually kind of disgusting, and it's weird how the Kerry campaign is digging itself deeper and deeper into this, as if it wants to continue to talk about the sexual preferences of the other guy's daughter. Bizarro.

COOPER: Donna, disgusting and weird, is it? DONNA BRAZILE, CNN CONTRIBUTOR: Well, you know, the Republicans can't have it both ways on this issue. Either they're for gay and lesbian equality, or they're against it.

What Senator Kerry was saying, and I think he said it in a very proud way, was that, you know, Mary Cheney is part of a family, just like many other families who have gay children and gay loved ones. And I don't think in any way he meant to disparage or to, you know, call her out in some awkward way.

TUCKER: (UNINTELLIGIBLE)...

COOPER: But Mary Cheney is a private person, Donna. And, I mean, yes, she's working on her dad's campaign, but she, you know, she's not out making speeches, she's not out get -- putting herself in front of the cameras. Is it right to bring her out in this way?

BRAZILE: Well, look, I would have not brought her out in that way, but I'm not the presidential candidate. I think what Senator Kerry was trying to say that this is not a choice. This is something that every gay and lesbian American lives with. It's something that's inherent. And that's what he was trying to prove that point.

I don't think he was in any way trying to denigrate this young person.

TUCKER: (UNINTELLIGIBLE), let's be honest here. I mean, not everybody has the same attitudes about homosexuality, the same attitudes that, you know, you may have, Donna, or, frankly, that I have. Mary Cheney is a lesbian, you know, great. Not everyone feels that way, at all. And so when you say that out loud in the middle of a political campaign, the understanding is, it's going to turn some people off, to some -- to the extent that they may not vote for you.

It cannot be seen as this context as anything other than a political tactic, and that's what makes it wrong, I think.

BRAZILE: Well, that's why Senator Kerry has spent his entire life fighting for equality for gays and lesbian Americans. And that's why Senator Kerry is opposed to this divisive constitutional amendment that would, you know, once again point out that gays and lesbians are different.

COOPER: Let's move on, let's talk about last night's debate a little bit more.

Tucker, did anyone really hit a home run? Did (UNINTELLIGIBLE) did hat happened last night matter, do you think?

TUCKER: Frankly, you know, brings me no pleasure saying this, but I think the president needed to do much better than he did. And coming on the heels of two debates where he looked the same way, it's not good.

COOPER: Donna, though, his supporters say, Well, you know, look, you know, he may have stumbled on facts here or there, or may have not look as, you know, fluid as Senator Kerry did, but at times he seemed to really speak from the heart, and that resonated with the viewers.

BRAZILE: Well, you know, he's the sitting president. He's the incumbent president. He has a record. And it seemed last night that he was trying to evade his record. I think Senator Kerry not only came across as someone who was presidential, steady, knowledgeable about the facts, but he was able to come across as likable.

COOPER: Donna Brazile, Tucker Carlson, thanks very much.

TUCKER: Thanks.

BRAZILE: Thank you.

COOPER: All of which are subjects that might come up later tonight when my colleague Paula Zahn talks with all-important undecided voters hosting a town hall meeting with some of them tonight.

Paula, where are you at?

PAULA ZAHN, HOST, "PAULA ZAHN NOW": Hi, Anderson. I join you from Bucks County, Pennsylvania, tonight. It is farm country on the banks of the Delaware River between New York City and Philadelphia. It is a deeply divided county in a divided state, in a divided nation, a state that Al Gore took in the year 2000. The latest polls show that it is a dead heat here, or at least it was prior to last night's debate.

Now, tonight about 125 voters, and you're going to meet some of them right now, will join me to put questions to the Kerry campaign and to one of the vice president's daughters, Liz Cheney, and we will cover the gamut from terrorism to the economy to health care and much more. It sort of depends on the questions you all deliver here this evening. So we look forward to hearing from all of them here this evening, Anderson. We will be here at 8:00 at the top of the hour.

COOPER: Always unpredictable, what people are going to ask. Paula, thanks very much.

ZAHN: Thank you.

COOPER: Yaser Hamdi proclaims his innocent. That tops our look at global stories in the uplink.

Hamdi, he's the guy who was held for three years as a enemy combatant in the U.S., well, he spoke to CNN exclusively for his first broadcast interview since his release. He says it is great to be back home in Saudi Arabia. That's him there. And he says he is not bitter about his arrest, claiming that his regained freedom proves his innocence. Hamdi plans to resume his college education and get married. He'd been taken in Afghanistan, held for three years.

Kabul, Afghanistan, now, let every vote be counted. Election officials have begun tallying the ballots from the country's first presidential election. Interim leader Hamid Karzai is expected to win. Voter turnout Saturday was about 75 percent. It's going to take awhile to count all those ballots, though.

Phnom Penh, Cambodia, he can dance, but can he lead? That's the crown prince, Prince Nordam Siamoni (ph), a former ballet dancer and cultural ambassador will succeed his father as Cambodia's king. The country's throne council made the announcement this morning. Siamoni's father stunned Cambodians last week when he announced his retirement because of health problems.

London, England, now, no sex tonight. A new study of a British sexual practice survey shows 1 percent of adults have no interest in sex. Analysts say asexuals are already beginning to show their pride. On one activist Web site, there's a T-shirt for sale with the slogan "Asexuality Is Not Just for Amoebas Any More." Hmm. I don't know, I'm not sure that's going to sweep the country. We'll see.

All right, that's a quick look at tonight's uplink.

Fox News Channel's Bill O'Reilly sued for sexual harassment by his employee. He says it's extortion. She says his frank, falafel talk went too far.

Is Martha Stewart going to pen a prison memoir? You won't believe how much she could make from a behind bars tell-all.

And puppets too hot to handle.

Tonight, we go 360 with the creators of South Park. And talk about why their new movie almost got an NC-17 rating.

(COMMERCIAL BREAK)

COOPER: In the next half hour on 360, cable star Bill O'Reilly faces sexual harassment charges. How big is the case against him? We'll hear the accusations and the countercharges. All side.

Plus, Martha Stewart's days in jail hitting bookshelves? We'll tell you about a possible multimillion dollar book deal.

First, let's check our top story in tonight's "Reset."

In Atlanta, Georgia, the trial of a crematory operator. Remember this story? He was accused of not burning hundreds of corpses. Well, the trial is now on hold. Ray Brent Marsh was scheduled to have his day in court this month, but that likely won't happen because the state supreme court is hearing an appeal of the many criminal charges against him. And there are a bunch. Two-years-ago, 334 decaying bodies were discovered at the Marsh's Tristate crematory.

In Northern California, firefighters are gaining control of a wildfire that has scorched more than 37,000 acres. Favorable weather has helped calmed the fire whose smoke can be seen from the San Francisco Bay Area and that's about 60 miles away. As you can see, they're dropping all sorts of chemicals. Full containment is expected by Saturday night.

In San Juan, Tiger Woods' honeymoon has run into trouble with the law. Woods and his new wife had docked their megayacht in San Juan Harbor without notifying authorities, violating U.S. Maritime Security Laws. It's tough when you have a yacht that big, as Lisa Bloom will attest. They could be fined more than $32,000.

In Lake Windmere, England, the blind leading the blind wind surfing. Take a look at this, a 71-year-old blind wind surfer and his friend, a speed boat driver, who, get this, is also blind -- we should say water skier. I'm mixing up my sports here. The guy driving the boat is also blind. They zipped across the lake at 46.2 miles per hour breaking a world record in waterskiing. I didn't know there were records in waterskiing, but there are. It's been broken.

Bill O'Reilly is one of the most influential broadcasters on cable TV, no doubt about it, with his "The O'Reilly Factor" on Fox news. He also has a daily gig on the radio and a syndicated newspaper column. And he's even got a kid's book out right now that he's promoting, but the print a lot of people are talking about today are the gory details contained in a sexual harassment complaint filed by a member of his staff.

As always on our show, we're covering all the sides. First, here's what she and her lawyers have to say.

(BEGIN VIDEOTAPE)

BENEDICT MORELLI, ATTORNEY FOR ANDREA MACKRIS: Suddenly, without provocation or warning, the defendant, Bill O'Reilly, said to the plaintiff Andrea Mackris quote, "and just use your vibrator to blow off steam" end quote.

During the course of Mr. O'Reilly's telephone monologue on August 2, 2004, he suggested that plaintiff Andrea Mackris purchase a vibrator and name it. And that he had one -- you might have to bleep this, I don't know, shaped like a (EXPLETIVE DELETED) with a little battery in it. That's a quote. That a woman had given him. It became apparent that the defendant was masturbating as he spoke.

ANDREA MACKRIS, FRM. FOX NEWS PRODUCER: The last time that I had spoken to Bill, when this inappropriate conversation had happened the last time, he said it was going to be in person. And I felt extremely threatened for many reasons.

(END VIDEOTAPE)

COOPER: Anyone who has ever tuned in to "The O'Reilly Factor" knows Bill O'Reilly is certainly not a pushover. Here's what he had to say.

(BEGIN VIDEOTAPE)

BILL O'REILLY, FOX NEWS ANCHOR: So, this morning I had to file a lawsuit against people demanding $60 million or they will, quote, punish me and Fox News. $60 million. I really can't say anything else. I don't want to waste your time with this. The justice system has the case. We'll see what happens. But in the end, you should know this is all about hurting me and the Fox News Channel. I knew by filing this lawsuit I was going to perhaps ruin my career and I knew the wild stuff would be in the papers, because the papers love that, you know how it goes. But all of us are targets. You know that. We're all targets. Every famous person in this country is a target.

And for the last 5 years I've had threats almost on a daily basis, we're going to kill you, we're going to get your family. I'm going to sue you for this, or that and the other thing. And a short time ago, this came in to Fox and they want $60 million. Now just think about that. The 9/11 families didn't get anywhere near that.

This is the single most evil thing I have ever experienced.

(END VIDEOTAPE)

COOPER: Covering the case for us, Court TV anchor Lisa Bloom. And from Miami, defense attorney Jayne Weintraub. And by the way, both have appeared on "The O'Reilly Factor."

Appreciate both of you joining us tonight.

Lisa, I want to start off with you. And I want to read an except from the lawsuit. It's actually hard to find a lot of excerpts you can read from this lawsuit, because so many of them are quite gory and very specific. But anyway, here's one that we can read. It's not going to shock anyone.

This person said -- O'Reilly is alleged to say, quote, "I'll rake her through the mud," talking about any woman who might bring up sexual harassment charges against him. Quote, "I'll rake her through the mud. Bring up things in her life. And I'll make her so miserable that she'll be destroyed and nobody would believe her. It would be her word against mine and who are they going to believe, me or some unstable woman making outrageous accusations." This is allegedly something he said to this woman who is now suing him.

LISA BLOOM, COURT TV: Right. And that's in her complaint, I think, to help explain why this went on for a couple of years before she complained. O'Reilly does have a reputation for being somewhat volatile, others have complained, like Al Franken, that they were targets of retaliation when they made claims against him. That's why I think that's in the complaint.

But Anderson, I've got to tell you, if this woman has tapes and the complaint I think strongly indicates that she does by doing long block quotes from O'Reilly, including -- and doing uh, and um, as through it's transcribed directly from a tape, this is going to be a very significant factor for O'Reilly.

COOPER: Jayne, let me read to you about another thing from this thing. And I want to talk more about whether or not she does have tapes. And if she does, why they haven't come out and said this. This is another excerpt from the lawsuit. It's an alleged, I guess, phone sex conversation again, part of it, the part that we can read. Quote, "you still would be with your back to me, then I would kind of put my arm into one of those mitts, those loofa mitts, you know, so I got my hands in it, and I would put it around your front, kind of rub your tummy a little bit with it." And we're going to end it there, because it goes on talking about falafels and stuff, which I don't really understand.

Why, if this woman has the tape, why haven't they come forward with it?

JAYNE WEINTRAUB, DEFENSE ATTORNEY: Well, that's a very good question. And I would like to hear the answer to that by Ben Morelli, myself, the lawyer who filed it.

BLOOM: They don't have to. They're not in discovery yet, that's why.

WEINTRAUB: Lisa, you know what? This is a real disservice to sexual harassment victims of any sort walking around. First of all, let's look at the facts here. This woman worked for Fox, and alleges that these all happened to her. She felt trapped. She was so threatened and scared. Why didn't she just hang up? Why didn't she quite? Why didn't she leave? Why didn't she complain? Why didn't she do anything? Even if he did the things she claims, $60 million? What is going to in this country with our justice system? This is not justice...

BLOOM: You know what the answer to that is, Sandy. Women are not required to leave their jobs. Guess what? We can keep our jobs and insist that we not be sexually harassed.

WEINTRAUB: Why didn't she make a complaint about it? Why did she go back to work for him?

BLOOM: Let me tell you, you expect this woman to make a complaint on her own against Bill O'Reilly, one of the biggest stars at Fox News. She hired an attorney to do it on her behalf. That was appropriate.

WEINTRAUB: What are the damages here. I'm sorry, Anderson. What are the damages, $60 million. Even if he did what she claims where does she come off asking for 60 million damages. I say kudos to Bill O'Reilly for having the courage to stand up as a celebrity and say I'm not going to be blackmailed and I'm not going to hush this under the rug.

BLOOM: ...in the way that it's alleged in this complaint talking about graphic explicit activities.

WEINTRAUB: Lisa, why (UNINTELLIGIBLE) having this conversation?

BLOOM: ...including sexual intercourse. Why would you give kudos to someone like that. If she demanded $60 million it was to avoid filing the lawsuit.

WEINTRAUB: Because she's an adult. Why did she have these conversations?

BLOOM: ...they said no, the lawsuit has now been filed. The difference is if they threatened to go public without the 60 million being paid that could be extortion...

COOPER: So the line between extortion and asking for money is what?

BLOOM: If you say I'm going to file a lawsuit unless you pay me X dollars, not extortion. That's just pretrial settlement talk, happens every day of the week. If you say unless you pay me X dollars I will expose you, I will go public that very well could be extortion. If her attorney did that, that was an error on his part.

WEINTRAUB: We know her attorney very well, you and I, we were both on a TV show with him...

BLOOM: Outstanding trial attorney.

WEINTRAUB: He has quite a theatrical flair. She e-mailed one of her best friends last month.

And she said...

COOPER: I'm not sure theatrical is all that bad.

A little sensitive for you both right there.

WEINTRAUB: She e-mailed her friend and she was saying she was happy. She loved the job and couldn't be happier. She's home again and never leaving and that's working for Bill O'Reilly.

BLOOM: She's got a tape of these comments by Bill O'Reilly of the explicit behavior he wants to engage. It's over for him if she really has that on tape.

WEINTRAUB: I think she has to take some sort of responsibility.

BLOOM: She has to take responsibility for the comments he made?

WEINTRAUB: Lisa, you don't know what she was saying to him!

COOPER: Is it all one-sided at this point? All of these details. Anybody can be sued these days. All of us can be sued.

BLOOM: You can be sued but there's got to be some evidence. If she's got a tape of these comments his only defense is that she was encouraging in it.

COOPER: It is completely one-sided. The transcripts and the tapes are all from her.

BLOOM: That's true because I'm sure Bill O'Reilly wasn't taping conversations where he's making sexually explicit comments to his employee. Let's see if he has tapes of these alleged extortion comments. Bill O'Reilly to make these comments when he's being taped not the smartest move on his part.

WEINTRAUB: In Florida, it would be illegal to tape record those conversations. I don't know if it is in New York, but in Florida that would be an illegal act.

BLOOM: Do you think she'll get prosecuted for taping, forget about it.

COOPER: Let's leave it there. Thank you very much.

The topic for today's buzz. What do you think? Do you believe the allegations against Bill O'Reilly are true? Yes or no. Log on to CNN.com/360. Cast your vote.

Martha Stewart's prison sentence may end with a book tour. Everybody's got books these days. Reports that the convicted home maven could be working on a memoir of her life as an inmate.

Later, puppet masters the "South Park" way. We like to look at all different stories. The guys behind the show "South Park" stopped by to talk about their strange new controversial movie.

(COMMERCIAL BREAK)

COOPER: When Martha Stewart entered prison six days ago, she was allowed to keep her toothbrush, her earrings and a keen business sense. With word of a memoir in the works, Stewart's return to freedom may include a few tips on living without it. CNN's Mary Snow has details.

(BEGIN VIDEOTAPE)

MARY SNOW, CNN CORRESPONDENT (voice-over): It's not exactly the kind of home the domestic guru had in mind when she built her fortune, but Martha Stewart's time in the big house in Alderson, West Virginia, could be part of a book on her life. A person familiar with the situation says Stewart is interested in an autobiography at some point and there have been preliminary talks among her lawyers and publishers. The Stewart camp denies a report that she plans to write a prison memoir, but Stewart did tell Larry King she wanted to write a book shortly after she was sentenced.

MARTHA STEWART: I think I'll write a book because I think it could be helpful to other people just about -- just about what to choose, how to behave, how to attend an interview. There's things that -- there's no how-to book about this.

SNOW: Stewart's stretch beyond how-to domestic tips could prove to be a challenge since publishing insiders say personal details equal dollars. An early reaction on the street of Stewart writing a book is getting mixed views.

UNIDENTIFIED MALE: I'm sure there will be one passage in there about how she baked cookies for everyone in prison and how everyone loved her as a result, but other than that, I don't think I'd read it cover to cover.

UNIDENTIFIED FEMALE: I'd like to know what she's thinking and how she's passing the time whether she's reading, whether she's dreaming up new recipes or what kind of creative processes are going through her mind.

(END VIDEOTAPE)

SNOW: The big question is how much would a book about Martha Stewart written by Martha Stewart be worth? "New York Magazine" says a prison memoir alone could fetch as much as $5 million, but industry insiders say that's way too high and Stewart's people say it's way too early to be talking money.

COOPER: Mary Snow, thanks very much.

Next on 360 from South Park to a theater near you. The cartoon creators have a new puppet movie out. It offends just about everyone, the U.N., the White House, anyone you can possibly think, I think even Sean Penn. Don't expect it to be cute and cuddly, though. We'll talk about it with the creators of "South Park."

(COMMERCIAL BREAK)

COOPER: In tonight's pop culture current, two men who proved beyond any doubts that their animated characters may not be all sweetness and light, but can in fact be shocking, foul-mouthed little (UNINTELLIGIBLE). The men who wrote the movie "Team America" are currently doing for puppets on the big screen what they did for cartoon kids on "South Park," making them offensive and funny. Earlier I spoke to them about the controversy surrounding the move.

(BEGIN VIDEOTAPE)

COOPER: You've been getting a lot of flack already, I guess that's to be anticipated. What do you make of all the flack?

TREY PARKER, PRODUCER/CREATOR, "TEAM AMERICA": We're excited that we made a movie where we pissed off the White House and Sean Penn. We think that's quite an accomplishment.

COOPER: When you accomplish that it's pretty remarkable.

The White House say this film is anti-Bush. You say what?

MATT STONE, "TEAM AMERICA": We set out to do something about America and about, like what it's been like for us as Americans the last three or four years and about all of the confusing things and all of the confusing voices whether it's from celebrity actors or from Muslim terrorists.

COOPER: Is it OK to make fun of the war on terror?

PARKER: We deal with everything with comedy and I know if one of us got cancer tomorrow we'd be making jokes about it.

Humor is how we analyze things.

COOPER: Let's take a look at a clip of Kim Jong Il from the film.

UNIDENTIFIED MALE: Hans Blix? Oh, no!

UNIDENTIFIED MALE: Hello, great to see you!

UNIDENTIFIED MALE: Mr. Il, I was supposed to be allowed to inspect your palace today and your guards won't let me into certain areas.

UNIDENTIFIED MALE: We've been through this a dozen times. I don't have any weapons of mass destruction, OK!

UNIDENTIFIED MALE: Then let me look around so I can ease the U.N.'s collective minds. I'm sorry, but the U.N. must be firm with you. Let me see your whole palace or else?

UNIDENTIFIED MALE: Or else what?

UNIDENTIFIED MALE: Or else you will be very, angry with you and we will write you a letter telling you how angry we are.

(END VIDEOTAPE)

PARKER: That's about the only G-rated 60 seconds of the entire movie.

COOPER: I have to ask you about that. You're going to have an NC-17 movie because of puppet sex or marionette sex.

PARKER: We didn't make anatomically correct puppets and we just did all these different positions and they came back with an NC-17 and said they can do this and not this and they can't do that.

STONE: They said we could only have missionary and her on top, but that's not really a joke. That's normal life. That's a normal night.

PARKER: That's normal puppet sex.

COOPER: What is the rating now, R?

PARKER: We had to cut the sex scenes from two minutes long to a minute.

COOPER: It's a hard R. Everyone asks me, should I take my 13- year-old?

STONE: It's a filthy movie.

PARKER: It's an adult movie.

COOPER: So you don't want little kids going to this movie.

PARKER: That wouldn't be very cool.

COOPER: Sean Penn doesn't think this movie is cool either. I guess he's one of the characters in your movie unbeknownst to him.

I guess he says you're discouraging people from voting. He said this, quote, "it's all well to joke about me or whomever you choose, not so well to encourage irresponsibility that will ultimately lead to the disembowelment, mutilation, exploitation and death of innocent people throughout the world. The vote matters to them. No one's ignorance, including a couple of hip cross-dressers is an excuse."

I guess the hip cross-dressers would be you guys.

STONE: We were quoted in "Rolling Stone" talking about how we thought that encouraging uninformed voters to vote wasn't...

PARKER: Just go vote not go get informed. We were talking about vote or die, just vote or I'll kill you.

STONE: For us it was like if those kinds of campaigns were get involved to get aware and make a decision to be part of the democratic process, but to shame people -- to shame people who don't know what's going on in the world and voting we just don't think that...

PARKER: Especially because he was just made -- he is just mad that we're making fun of him, how dare we make fun of him and that we had him eaten by a panther in our movie.

COOPER: I look forward to the movie and you guys are incredibly great and we appreciate you being here.

(END VIDEOTAPE)

COOPER: We'll be right back, plus tomorrow we'll talk with Hollywood madam Heidi Fleiss. She'll give us some insight into what Martha Stewart is facing in prison. Should be interesting. First today's buzz, do you believe the allegations against Bill O'Reilly are true? Yes or no. Log on to CNN.com/360. Cast your vote. Results when we come back.

(COMMERCIAL BREAK)

COOPER: Tonight taking anticlaim to the Nth Degree. I don't know about you, but we here keenly feel what we call PDL, post debate letdown. That's it. It's all over. No more face-offs and so many questions we hoped would be asked but never were nor now ever will be.

For instance, Mr. President, we read that one of your favorite activities there at the ranch in Crawford is clearing brush. What's that about? You actually like dragging stumps and tree branches around, why?

Mr. Kerry, why is there a right turn on red in some states and not in others? Doesn't that drive you nuts?

Mr. Bush, do you get unsolicited calls from telemarketers in the middle of dinner? Ever been offered a free Florida vacation or asked if you're satisfied with your current long distance carrier? How very sad. Neither man ever was asked do you think Martha got what was coming to her or raw deal.

Now we'll never know. I'm Anderson Cooper. Thanks for watching 360. Coming up next, "PAULA ZAHN NOW."

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