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Paris Hilton Headed Back to Court; Defense Secretary Recommends New Chairman of Joint Chiefs; William Jefferson Pleads Not Guilty to Corruption Charges; U.S. Relaxing New Passport Requirements

Aired June 08, 2007 - 13:00   ET


BETTY NGUYEN, CO-HOST: And we are watching it. Yes, Paris Hilton headed back to court, maybe back to jail. All eyes on her West Hollywood home this afternoon.
T.J. HOLMES, CO-HOST: Including ours, yes. Her house arrest doesn't sit too well with the judge who arranged her stay in the Gray Bar Hotel.

I'm T.J. Holmes here, sitting in today for Don Lemon. We're coming to you from the CNN world headquarters in Atlanta, Georgia.

NGUYEN: Yes, and I'm Betty Nguyen, in for Kyra Phillips today. You are in the CNN NEWSROOM, and you are looking live at West Hollywood, California.

We've been watching this for quite some time now, as the judge has ordered Paris to at least appear in person at that hearing. You think it would have been a quick, hey, we're going to come by and pick you up. But not the case.

HOLMES: Maybe she's getting ready, making sure she looks fabulous before she makes a public appearance. But we have. We've been watching it for a while. And the word was earlier that she was going to actually be allowed to listen into this hearing by phone.

The judge says, "Un-huh, that's not going to work" and ordered her to come to the court. There's the possibility she could be going back to jail after her -- after that sentence was cut way, way, way short. We thought she was going to be in jail for some 20 days, ended up being about two or three. And a mysterious medical condition still, what we're trying to figure out what's going on.

NGUYEN: That's what a lot of people want to know. What is it? What was the medical condition that got her out of jail?

And a lot of people really looking at the sheriff's department and was there contempt of court here, in allowing her to go home and wear this ankle bracelet, which is something the judge originally said, "No, you're not going to do. You are going to spend this time in jail and the full sentence of it."


HOLMES: Apparently, she's at home right now.

And again, she's getting a free ride to the court. Sheriff's there to pick her up.

NGUYEN: It's not free. Somebody is paying for it.

HOLMES: Somebody is paying for it. Taxpayers are, out there.

Our Sibila Vargas is standing outside the courthouse, I believe it is. I know you're at the jail. I believe at the courthouse now. Tell us what is it like out there? And has it just been a circus? This has been a weird day here, Sibila.

SIBILA VARGAS, CNN CORRESPONDENT: I am not in the courthouse right now, but I can tell you it has been a circus all day. I've been out here since 1 a.m. this morning, Pacific Time. And I mean, we've been hearing all kinds of reports.

But just like you, I mean, the fact that first she was supposed to appear in court, and then they said, no, she's actually going to do it by phone. And then all of a sudden, you know, no, she -- the judge actually wants her to appear in court. I mean, it gets more bizarre by the minute. It is just absolutely insane and outrageous.

And again, a lot of people very upset with the L.A. County Sheriff's Department for making the decision to allow Paris Hilton to go home after serving only three days because of a medical condition which they didn't even talk about, that they didn't want to elaborate on, only to stay that it was -- it wasn't a staph infection.

A lot of people outraged for that. And we had some leaders out here in Los Angeles yesterday basically talking about that, saying you know what? Not everybody likes jail. They wouldn't be happy serving time in a 12-by-8-foot cell. Paris didn't like it. A lot of other people don't like it. When they have to a medical problem, they go to the medical unit at the jail.

What makes Paris so special that they feel that she should be allowed, because she has a medical problem, that she shouldn't be treated at jail, that she should go home? So a lot of interesting fireworks expected at this courtroom when Paris Hilton finally makes it there.

HOLMES: All right. Sibila, I know a lot going on there. We've got a lot going on elsewhere, as well. But we're going to get back with you here in a little while. Thank you.

VARGAS: Another big story of the day. We are watching and waiting for it to happen.

We want to take you now live to the Pentagon. You see the podium right there. We are expecting Defense Secretary Robert Gates to be coming out at any moment and making a personnel announcement, and we have obviously our cameras there.

And we have learned, though, that it is expected that General Peter Pace, perhaps, will resign today, announce that resignation.

We heard from Barbara Starr a little bit earlier on CNN International, saying that the re-nomination papers were already drafted so General Pace was essentially going to stay within his position, but it looks like we are getting news now from Defense Secretary Robert Gates. Let's take a listen.

ROBERT GATES, DEFENSE SECRETARY: It is my honor to announce today that I will recommend to the president that he nominate Admiral Michael G. Mullen, chief of naval operations, as the next chairman of the joint chiefs of staff, succeeding General Peter Pace when the latter's term of office concludes on September 30, 2007.

Admiral Mullen became chief of naval operations on July 22, 2005. A 1968 graduate of the Naval Academy, he has served in allied, joint, and Navy positions overseas and in both the Atlantic and Pacific fleets.

I have become well acquainted with Admiral Mullen over the last six months and believe he has the vision, strategic insight, experience, and integrity to lead America's armed forces.

I'm also pleased to announce that I will recommend to the president that he -- that he nominate General James E. Cartwright, currently the commander of strategic command, as the next vice chairman of the joint chiefs of staff, succeeding Admiral Edmund G. Giambastiani Jr., who has announced his intention to retire.

General Cartwright has been the commander of Stratcom since 2004, responsible for global command and control of U.S. strategic forces, computer network operations, Department of Defense information operations, as well as global command, control, communications, computers, intelligence, surveillance and reconnaissance.

He served as director of the joint staff for force structure, resources and assessment from 2002 to 2004. I believe he is exceptionally well qualified to take on the responsibilities of vice chairman.

It had been my intention from early in my tenure to recommend to the president that General Pace be re-nominated for another two-year term as chairman.

However, after consultations over the course of several weeks with both Republican and Democratic senators, I concluded that, because General Pace has served as chairman and vice chairman as the joint chiefs of staff for the last six years, the focus of his confirmation process would have been on the past, rather than the future. And, further, that there was the very real prospect the process would be quite contentious.

I am no stranger to contentious confirmations, and I do not shrink from them. However, I have decided at this moment in our history, the nation, our men and women in uniform, and General Pace himself would not be well served by a divisive ordeal in selecting the next chairman of the joint chiefs of staff.

Pete Pace has been a United States Marine for more than 40 years. He has served our country with great distinction and deserves the deepest thanks of the American people for a lifetime of service to the country and for his leadership.

I have thoroughly enjoyed working with him, trust him completely, and value his candor and his willingness to speak his mind. I look forward to continuing to work with him until the fall and to a continuing friendship after his retirement.

I also will miss Ed Giambastiani. I'd intended to recommend that Ed be re-nominated for another term as vice chief. But the selection of Admiral Mullen foreclosed -- as chairman foreclosed that option.

I then asked Ed to take on another senior assignment, and he decided to proceed with his plans to retire.

On a personal note, Ed and I first worked together over 20 years ago when I was deputy director of central intelligence. Ed has given 37 years of distinguished military service to America, and merits our gratitude and highest respect.

Both General Pace and Admiral Giambastiani will be recognized in ways that befit their extraordinary and distinguished service.

I'd be happy to take a couple of questions -- Lita (ph).

UNIDENTIFIED FEMALE: Mr. Secretary, did members of Congress tell you specifically that they did not want to see General Pace re- nominated?

GATES: I would characterize the counsel that I received more along the lines that I've described, that it would be a backward looking and very contentious process.

UNIDENTIFIED MALE: Mr. Secretary, could this be described in Washington terms, I guess, as a shakeup?

GATES: No. I think this is a -- an effort to do what I think is in the best long-term interests of the services and of the country, as well as the individuals involved.

I think that, as I say, my -- my intent had been to re-nominate both -- both General Pace and Admiral Giambastiani. But I think that the events of the last several months have simply created an environment in which I think there would be a confirmation process that would not be in the best interests of the country.

UNIDENTIFIED MALE: So it's not a reflection of how General Pace conducted the war in Iraq?

GATES: It has absolutely -- it has absolutely nothing to do with my view of General Pace's performance or that of General Giambastiani whatsoever.

UNIDENTIFIED MALE: Sir, any concern that, with only a year and a half left in your tenure, in the midst of this new security plan, that a change in the top at this moment will complicate, make your job harder? GATES: No, I don't think so. First, of all, the people that I'm recommending to the president are very experienced. We have three other chiefs of staff who are experienced people. We have, I think, a deep bench at the Department of Defense.

The vice chairman, in particular, over the -- over recent years has particularly taken on a role in working with the deputy on resources, in dealing with the Hill, and the interagency process.

I think General Cartwright has a lot of experience in each of these areas. And I know the deputy is looking forward to working with him, assuming the Senate -- assuming the president nominates him and the Senate confirms him.

So I -- I think that -- I don't think that there will be a problem.

UNIDENTIFIED MALE: Mr. Secretary, who will replace Admiral Mullen as CNO?

GATES: That -- no decision has been made on that at this point.

UNIDENTIFIED MALE: Mr. Secretary, you seem rather down about this situation, where you couldn't get your first two choices for these nominations. What does it say about the situation in Washington, where the politics on the Hill affect even senior, very crucial military appointments?

GATES: Well, I -- I am disappointed that circumstances make this kind of a decision necessary. I -- as I say, I just think that a -- a divisive ordeal at this point is not in the interest of the country or of our military services, our men and women in uniform or the individuals.

I wish that that were not the case. I wish it were not necessary to make a decision like this, but I think it's a realistic appraisal of where we are.

UNIDENTIFIED MALE: Mr. Secretary, in your talks on the Hill with congressional members, did any of them give suggestions to you for Admiral Mullen or the other choices?

GATES: No. No. This was -- my selections here have been made, quite frankly, in consultation with General Pace and with the deputy secretary.

UNIDENTIFIED MALE: Mr. Secretary, what is it that Admiral Mullen brings to this position at this particular time?

GATES: Well, he's probably, I think, at this point is the most senior of the service chiefs. But, more importantly, I think he is a very smart, strategic thinker, and I think he has a view of the interests of the services as a whole.

When -- when my senior military assistant was making his introductory calls on the various service chiefs and he asked Admiral Mullen what was the thing on his -- he was most concerned about, the chief of naval operations said the Army.

So he has a broad view of what the needs and requirements of the services are, what the nation -- of the nation, and I think he brings also a -- a tremendous strategic sense.

So as we try to look to the future, in terms of where we need to be, five years from now or ten years from now, I think Admiral Mullen will bring a tremendous perspective.

UNIDENTIFIED MALE: Mr. Secretary, what was it exactly that the congressman told you that he concerns about with Chairman Pace?

GATES: What they, to a person told me, was the highest respect they had for General Pace as a military officer, for his integrity and so on. Their comments were more about what they thought the hearings would be like and what focus of the hearings would be, rather than on anything about General Pace, the individual or as a person.

So it was really more of an appraisal of the fact that, because of his experience over the last six years, the focus of the hearings would be backward looking instead of forward looking, and contentious, just because of all of the issues that we're familiar with.

So I think it's important. I'm glad you asked the question. Because one of the things that everybody I talked to expressed was their very highest regard for General Pace as a military officer.

UNIDENTIFIED MALE: Does that indicate to you, Mr. Secretary, that support for the Iraq war in Congress, even among Republicans, is seriously waning?

GATES: No, I don't think it says that.

UNIDENTIFIED MALE: Well, why wouldn't they, then, want to go through the rigors of that debate?

GATES: It was my decision that we would -- that this kind of a divisive ordeal was not in the best interests. It was -- it ended up being my decision.

UNIDENTIFIED MALE: Thanks very much.



NGUYEN: And so you've been listening there to Defense Secretary Robert Gates, talking about the resignation of Peter Pace, the chairman of the joint chiefs of staff, and who he is hoping will be the nomination, Michael G. Mullen. We're going to learn a lot more about that name. Here's his picture.

CNN's Barbara Starr joins us now to put all of this in perspective. A bunch of names laid out today. Give us some background on these. BARBARA STARR, CNN CORRESPONDENT: Well, Betty, this whole announcement is fairly stunning, actually. I'm not really sure where to begin, other than with Secretary Gates' almost last remark there, that it was his decision not to go forward with General Pace being nominated to another term as chairman of the joint chiefs of staff.

Now of course, that may well have been, actually, a recommendation to President Bush, because it is the president of the United States that nominates the chairman to Congress, essentially. The chairman is the president's senior military adviser.

What Secretary Gates has repeatedly said in this very brief press conference that we've had is that this was, indeed, a political decision, not a decision about who could offer the best military advice to the president. In fact, he praised General Pace extensively.

But secretary Gates said he -- Secretary Gates -- was unwilling to see what would -- he thought would be a contentious confirmation hearing about -- and that it would wind up being about the war in Iraq. That Democrats and Republicans on Capitol Hill had told him, if he sent Pace's nomination up, there would be a contentious hearing about the war.

Frankly, knowing General Pace, I cannot imagine that General Pace would have actually shirked from that. He's a pretty -- pretty savvy customer and could deal, one would think, with any of the questions that he got.

It's the first time I can really remember a secretary of defense making this type of political decision about who would be nominated to a job, not on the basis of their military advice, but on the basis that the questions from the Hill would be too hard -- Betty.

NGUYEN: He was saying that it would be a divisive ordeal and not in the best interests of the country. And I know we're going to talk to you at the top of the hour, but it just leads you to question is this Gates' way of distancing himself from the war, when he's...?

STARR: Well, I have to tell you, Betty, that's clearly, to those of us who watch the Pentagon, what it certainly appears to be.

Since he's come in, Secretary Gates has taken great pains, actually, in many of his dealings with the news media, to distance himself with the conduct of the war as it was in the past.

This appears very much to be another step. Secretary Gates not wanting to see yet again another public discussion of how the war was conducted.

NGUYEN: Right.

STARR: As for Admiral Mullen, he's a tough customer, as well, very well respected; very much, as a naval commander, a man who watches Iran closely. He will be a very competent chairman, there's every reason to believe. NGUYEN: Barbara, we thank you for that. We're going to talk more about it at the top of the hour.

We do have some live pictures out of California and Paris Hilton that we want to talk about.

HOLMES: Let's go ahead and take that live picture. We have been watching this as this was going on. But this is Paris Hilton's house. The judge ordered her to be picked up and come to court for a hearing today after she was released from jail early just a day or two ago.

We just saw her get into this car. My producers, got two of you talking to me. Not sure what you're telling me what to do. But I'm trying to tell the audience here what we're looking at, which is Paris Hilton's home. She has gotten into the back of this police car and is now being taken to the courthouse, where the judge ordered her to appear for her hearing.

She was scheduled. And reports were she was just going to be able to be on the phone during that hearing. The judge said he is not going to allow that to happen.

This is what we saw just moments ago, was Paris Hilton there, and indeed, we believe that's her. No reason to think anything otherwise. But, in fact, she did have handcuffs on. Her hands were cuffed behind her. So, in fact, the sheriff's deputies have done their role here, picked her up at home, taking her to the court for this hearing today.

Again, as you know, she was released from jail after three days in jail. Supposed to serve 20 days in jail.

Here, back to a live picture of the chaotic scene outside of her home there in West Hollywood. She was supposed to, again, spend 20 days in jail for violating probation on a reckless driving charge. She ended up only serving three days because of some kind of mysterious medical condition, that the sheriff's department thought it was better for her not to be in jail. And she was allowed to go home.

And there you go. A crazy scene outside of her home, as the police now are driving her back to the courthouse, where she is going to appear before this judge to talk about why she was let out of jail early and what this mysterious medical condition is, that a shrink apparently said she was on the verge of a nervous breakdown.

Our Sibila Vargas standing by for us, been on this story for the past couple of days for us. And Sibila, this is just getting stranger and stranger. And in fact, it looks like she was -- she was in handcuffs.

VARGAS: Yes, absolutely. More bizarre by the minute. I was saying more bizarre by the hour, but in this case, more bizarre by the minute, like you said.

She was supposed to be at the courthouse early today, and then they said, no, she's going to be doing it by phone. And then all of a sudden now she is definitely on her way, because Michael Sauer, the judge, who actually gave her the 45-day jail sentence, wants to see her again.

And this is all spearheaded by city attorney Rocky Delgadillo, who basically was up in arms about the fact that the L.A. County Sheriff's Department did allow Paris Hilton to serve the rest of her jail time, releasing her so she could be in house detention.

Michael Sauer, the judge, part of the condition when he sentenced her back in May 4, part of the condition was that she was not to have house detention.

So as you can imagine, there's going to be a lot of fireworks at that courthouse today. But it looks like the fireworks have already started outside of her home. I mean, the media frenzy is wild. You would think that -- you know, it gives new meaning to "Elvis has left the building." It's almost like the president is in town. It really has taken a life of its own, T.J.

HOLMES: And Sibila, have we seen or picking up that, sure, you talk about the D.A. there being upset. But is the judge also upset? Has he given any sign that he is upset at the way -- at the way this was handled by the sheriff's department? And that might have fired him up and said, "No, you're going to get yourself to court today," and he sent somebody to pick her up?

VARGAS: Yes, Michael Sauer -- yes, the judge, he is pretty much upset. In the first place, when I found out that they were actually going to let her do this by phone, I was kind of perplexed by this. Because this is the same judge, remember, that gave her the 45-day sentence.

I'm sure that the last thing that he wanted is for them to not only, you know, take that 45-day jail sentence, bring it down to 23 days, but also the fact that one of his -- one of the specific indications, part of his -- part of his -- I'm losing my words here -- part of his -- the sentence was that she does -- does not get to have house detention.

So the fact that they were going to let her do it over the phone, that doesn't sound right to me. So I think that he definitely wants to meet her face to face.

And, remember, this is also the same judge that pretty much was not buying the fact that she was saying it was all Elliott Mintz' fault, her publicist's fault. He was very adamant about this, that he was very angry with her in court. So it will be interesting to see what happens today.

HOLMES: Sibila, it's all right. We're all trying to find the words to describe some of this stuff we're seeing today. So we can understand. Sibila Vargas on the scene for us there as we watch this live picture.

Paris Hilton in the back seat of that police car, taken to court right now for a hearing to talk about why -- what medical condition she had that forced her to leave jail and vacate that sentence. She was supposed to be there 20 days, only there three, then confined to house arrest. Judge not happy about that. He wants to see her in court.

We will stay on this story. Going to take a quick break. We'll be right back.


HOLMES: Back to the live picture. You're probably wondering why in the world are we showing you a live picture of a police car. Well, this is a story that has been developing this week.

Inside that police car is Paris Hilton, being driven, escorted to jail by L.A. sheriff's deputies after a judge ordered her. This is the picture we saw just a short time ago, the video of her at her home in handcuffs being placed back in the sheriff's deputy car and being taken to court.

She, of course, as you know, got out of jail early this week. Only spent three days in jail, supposed to spend up to 20 days in jail for violating probation on a reckless driving charge. She only served three days of that sentence, reportedly because of some kind of a medical condition.

Psychiatrists say she was on the brink of some kind of a meltdown, a mental breakdown. The sheriff decided to let her go home, spend the rest of her time at home under house arrest.

Well, the judge in the case who had laid down that sentence and also the D.A. there did not like the sheriff making that move. A hearing set today to talk about exactly why she had to be let out.

She was supposed to be at that hearing or at least supposed to be dialed into that hearing, we understand, was supposed to be allowed to do it by phone. The judge said no, sent sheriff's deputies to her home to pick her up and take her to the court, where she is going to have to appear before the judge and they're going to have to talk about this.

And there is a possibility he could send her back to jail.

So she is in that vehicle. Of course, media is all over it. Helicopter is keeping a trained eye on this sheriff's department vehicle. We understand it is some -- maybe a half hour drive from her home to the -- to the courthouse. So this is -- they're just about five minutes, ten at the most into this drive here.

NGUYEN: Look at that media spectacle.

HOLMES: But this is a spectacle. It is nothing short of a spectacle we're seeing here in L.A. That was some of the folks gathered. There was a huge crowd gathered outside of her home. So photographers chasing the vehicle as it took off.

But the live camera, the live helicopter, keeping a trained eye on this vehicle. And again, she was placed into that vehicle with -- in handcuffs. NGUYEN: Yes. And the question here, though -- and we're going to be talking to a lot of people about this today -- is it's taken so long for them to get her in that vehicle and take her to the courthouse, and, therefore, you have this media spectacle. Everyone has been given time to gather. And that's a big question. Would that have happened to anybody else?

If a sheriff's deputy showed up at your home, would you have enough time, hours to get ready and then be placed in the vehicles? So we're going to be talking with several guests about this throughout the next couple of hours.

But we have some other news that we do want to tell you about.

He has said it before, but this time it's for the record. Louisiana Congressman William Jefferson pleaded not guilty today to corruption charges that could send him to prison for the rest of his life.

CNN's Brianna Keilar joins us now from Washington. We heard from the congressman himself just a little bit earlier.

BRIANNA KEILAR, CNN CORRESPONDENT: That's right, Betty. Yes, Jefferson entered a not guilty plea, and he did speak publicly for the first time since he was indicted on Monday.

Now, a government prosecutor says that Jefferson solicited more than a half million dollars in bribes and sought millions more, using a network of family companies to hide the money.

In one case, prosecutors say Jefferson solicited a bribe in turn for promoting a company's joint venture in Nigeria.

But Jefferson was defiant today, insisting that he is innocent. He said the reputation of his family has been wrongfully sullied, and he urged people to keep an open mind.

For the first time, Jefferson talked about the $90,000 that the FBI says it found in a freezer in his Washington home back in 2005. That's money that they say was part of a payment from an FBI informant.

Let's listen to him.


REP. WILLIAM JEFFERSON (D), LOUISIANA: Did I bribe a foreign official? Absolutely not. The $90,000 was the FBI's money. The FBI gave it to me as part of its plan, part of their plan, that I would give it to the Nigerian vice president. But I did not do that.


KEILAR: Judge T.S. Ellis, the judge in this case, set Jefferson's trial date for January 16 of 2008. Why so far out? Well, Jefferson waived his right to a speedy trial, because his lawyer said more time was needed to go through documents related to the case.

Government prosecutors did say today in court that they have about eight file cabinets of documents and numerous recordings that they need to turn over to the defense -- Betty.

NGUYEN: Brianna, Jefferson has been released on his own recognizance. But what are the conditions of that release?

KEILAR: Well, there are certain conditions. For instance, he has to surrender his passport, although the judge has allowed him to surrender this passport to his own lawyer, Robert Trout.

And then there are some travel restrictions. He can travel freely in the Washington, D.C., metro area and also in Louisiana, obviously his home state. But if he's going to travel other places in the U.S. or if he's going to travel internationally for work, then he has to get an OK by the judge. Although the judge did say that he would be lenient with that.

And then this is kind of interesting. He is not allowed to use or possess weapons, guns. And Jefferson did say in court today that he has a number of rifles and shotguns for hunting. So the court said he's going to have to work that out so that he can't have any possession of those weapons, Betty.

NGUYEN: Now, speaking of that court hearing, you were there in the courtroom a little bit earlier today. What was that like? What was his demeanor?

KEILAR: He was pretty emotionless. I mean, he -- he did a little talking. He was under oath twice, and he did some talking. But mostly, it was him just watching his lawyer, Robert Trout.

One of the things that I did find very interesting, when he was sitting at the table there, watching this proceeding go on, he was clenching his jaw. And you could just see the muscles in the side of his jaw just rippling. So whether that's either some sort of habit he has or just a sign of tension, it was certainly very evident, and it was going on for minutes, Betty.

NGUYEN: All right. CNN's Brianna Keilar joining us live in D.C. Thank you for that.

HOLMES: Back to a live picture in Los Angeles, specifically Hollywood, where that is the vehicle, the cop car that is carrying Paris Hilton, carrying her back to court. Don't know if another car will take her back to jail at some point.

But as you know, she was released from jail early this week, released after only three days of a 20-something day sentence she was supposed to serve for violation of probation on a reckless driving charge. Let out of jail, reportedly because the sheriff made a determination that she was not in a good mental state. She was on the verge of nervous breakdown and that she'd be better served to go home.

You're watching that car on the left side of your screen. They left her home just a short time ago. Deputies went to pick her up.

And on the right side of the screen, this is over at the -- over at the courthouse, the parking structure there at the courthouse where they are heading, where people have gathered.

Of course, the media is there. We've seen people with signs. We've seen fans. We've seen onlookers, people all curious about what has become, as my co-anchor put it, a spectacle there in Los Angeles today.

We are keeping an eye on this story, expecting her to arrive at the courthouse maybe within the next 15 or 20 minutes. So we're keeping an eye on this and certainly, a lot of people curious to know if the judge will order her back to jail.

Meanwhile, some other news here to tell you about.

Is this person a kidnapper? Is this person a killer? This is Edwin Roy Hall, 26 years old, facing a judge by closed circuit video yesterday in Kansas.

He is accused of snatching a teenager from a store parking lot last weekend, a young woman whose body was found two days ago. And we just learned today exactly how 18-year-old Kelsey Smith died. The Johnson County district attorney's office says Smith was strangled by some sort of rope or cord.

NGUYEN: Let's get you some business news now.

The iPhone comes out later this month. A lot of people excited about that. But the iScam is already here. So let's check in now with Susan Lisovicz at the New York Stock Exchange. She's always ready to answer our call.

Boy, you know, people are really looking forward to this phone.

SUSAN LISOVICZ, CNN CORRESPONDENT: That's true. Some of you know quite well, Betty.

The much anticipated device is scheduled for release on June 29. But suspicious ads already popping up on sites like Craig's List. The ads offer iPhones ahead of the release date. The Better Business Bureau warns unless you're Steve Jobs' nephew, you're unlikely to get the phone before the release date. In other words, buyer beware.

And you know, all of the anticipation about this iPhone, Betty, has really been sending Apple shares higher. Yesterday, we had such an extreme sell-off that Apple shares rose to an all-time high...

NGUYEN: Really? LISOVICZ: ... just to give you an idea of how much pent-up demand there is for this device.

NGUYEN: All right. So speaking of high tech, it sounds like a dispute over high-tech cell phone chips could cost customers.

LISOVICZ: This is an interesting story, Betty. A federal agency has decided to ban U.S. imports of new phones made with chips made by Qualcomm. That could slow the introduction of handsets with features including those designed to compete with the iPhone. It could also lead to higher prices for wireless customers.

The ban does not affect current models, only ones that are in the new product pipeline. This comes after a patent dispute between Qualcomm and Broadcom over technology. This could hurt wireless carriers like Verizon. Eighty percent of Verizon's wireless phones use Qualcomm technology.

Qualcomm asking the court to overturn the regulatory ruling.


LISOVICZ: Coming up, some beer customers are finding themselves tapped out. Some bars are left without some popular brands. Now that's drama for you.

T.J. and Betty, I throw it back to you.

NGUYEN: Speaking of drama, we're going to check in to see how that Paris Hilton stalk is doing at this hour. Thank you, Susan.

T.J., I know you've been watching live pictures of that.

HOLMES: Yes, talk about drama. Not that dramatic, I guess, this picture we're seeing. But yes, we still have that camera trained on that police car there on your left, which is carrying Paris Hilton. She's not back in jail yet, but certainly, she is back in custody.

Placed in that car a short time ago in pictures we saw by sheriff's deputies, put her in that car in handcuffs. She's been escorted, if you will. There she is. Video we saw a short time ago, but being taken to the court where a judge wants to hear from her about this mysterious medical condition and why the sheriff took it upon himself to cut her loose after three days in jail, only serving three days of the 20-day sentence.

On the right there, you're seeing the picture from the courthouse, folks gathered there, certainly a lot of media, but a lot of onlookers. Sure some fans in there. We've seen a lot of people in the live picture on the left. As the car stops at stoplights and stops and slows down. People pulling up to that car waving, people certainly aware of what's going on there in Los Angeles.

Certainly, they know about slow-speed chases, if you will, and cars being followed around the freeways and the roads of Los Angeles. So they know what's going on. And expecting her in court at any minute now. And we will bring it to you and find out if Paris Hilton will, indeed, be going back to jail to serve out the rest of that sentence.

NGUYEN: In the meantime, though, if you are planning to travel abroad this summer, you might get your wings clipped, unless you've already have your passport. The line forms here, and you are in the CNN NEWSROOM.


NGUYEN: All eyes on Los Angeles, there at the entrance there to the courthouse, where the media has gathered, because Paris Hilton is in a squad car headed to that parking garage there, where a judge has ordered her to be in court today, and determine, he will, whether she should order -- or she should be ordered to serve out the remaining of her 23-day sentence.

Now, you're looking at video from earlier when Paris Hilton was put into that squad car. She was, indeed, handcuffed according to the video that we've been watching, and that car is en route to the courthouse. It should take about 30 minutes, and we're a good -- what -- 20 minutes into it now. So it shouldn't be too long before she arrives there. And as soon as she does, of course, we'll be watching all of it.

We also have guests coming up to discuss the legal angles of that. Just kind of looking at what he is holding up there. People have been holding up signs. There have been banners in the air, and a lot of support for Paris.

But there's been a lot of criticism on whether this is a two- tiered system -- legal system there. And we'll be talking to all of these issues a little bit later.

But we are on Paris watch, as is many other people, and as soon as she arrives, we'll bring it to you live.

HOLMES: And for millions of would-be summer travelers, the anxiety of waiting for a passport might be over. Unable to handle a flood of passport applications, the Bush administration is suspending a plan meant to bolster border security.

CNN's Allan Chernoff is on this story for us. He's live now in New York.

Hello to you, Allan.



Well, it looks like the lines here at the New York passport agency have eased up, perhaps because of this change in policy.

This morning, the government announced anyone who has applied for a passport but has yet to receive it can still fly to Canada, Mexico or the Caribbean, if they have proof that they have applied.

Now, this new requirement, which went into effect in January, had led to a record demand for passports. Before today's announcement, we prepared a package showing the frustration confronting Americans who have applied for passports well in advance of their travels.


CHERNOFF (voice-over): Diana Perez is in a panic five days before her family's scheduled flight to Colombia, South America.


CHERNOFF: The family's luggage is packed, but her children's passports have yet to arrive, even though Diana applied for them nearly four months ago. So she's been calling the passport agency each morning at the crack of dawn.

PEREZ: I start calling 6:01, 6:02, 6:03, and the whole morning. I spend, like, over two mornings on the phone.

CHERNOFF: Even worse than negotiating the agency's automated phone system is the fact that Diana and her husband, Orlando, spent $1,500 in airline tickets they may be unable to use.

ORLANDO PEREZ, WAITING FOR PASSPORTS: You can't even reschedule, because you don't know when we're going to get our passports.

CHERNOFF (on camera): The Perez family is not alone. As summer vacation season begins, the U.S. passport agency is overwhelmed, swamped with a record number of applications.

Why? The U.S. toughened passport policy in January, now requiring citizens to carry a passport when flying to Canada, Mexico, and the Caribbean.

WANDA NESBITT, BUREAU OF CONSUMER AFFAIRS: We did not know exactly what the level of increase would be, and so our predictions fell a little bit short, and that's why there's currently a little bit of a crunch.

CHERNOFF (voice-over): The crunch, though, wasn't a complete surprise. The State Department's passport agency had more than two years' notice. It was back in December 2004 that Congress approved tougher passport rules, part of its response to 9/11 Commission recommendations to tighten homeland security.

The State Department did beef up the passport agency, expanding facilities and hours and hiring 280 extra passport reviewers, even asking retirees to come back to work.

(on camera) And the number of people who actually review each application or each renewal is how many?

NESBITT: About 700 right now.

CHERNOFF: And this year you expect to process 17.5 million passports?

NESBITT: That's right. It's pretty efficient.

CHERNOFF: It sounds like not enough people.

NESBITT: As I said, we're in the process of hiring more.

CHERNOFF (voice-over): About 300 more this year. Plus, they're starting up this brand new passport printing center in Hot Springs, Arkansas, though it won't be fully operating until year's end.

NESBITT: We are doing everything possible to make sure THAT we meet the increased demand that is clearly out there.

CHERNOFF: The State Department acknowledges applicants now wait 10 to 12 weeks to get their passports, far longer than the prior wait time of six to eight.

Passport officials say Diana Perez' four-month wait time is the exception.

Travelers with an upcoming trip do get priority, and the vast majority of Americans are getting their passports in time to travel, even if the documents arrive with just a few days to spare.

Next year, even tougher rules kick in, requiring passports for Americans crossing the Canadian and Mexican borders by car, which is sure to further increase demand for passports.

The State Department says it's doing everything possible to meet the extra workload but is making no promises there won't be further delays next year.


CHERNOFF: A happy ending for the Perez family: they received their passports the day before their trip this past weekend. Under the new rules, they wouldn't have had to worry at all.

And, T.J., by the way, this temporary change, only in effect until the end of September. Back to you.

HOLMES: End of September. That's cutting it a little close for that family there, Allan. Thank you so much, reporting for us in New York City.

NGUYEN: Well again, we are on Paris watch. And we understand that the squad car that she's traveling to the courthouse has exited the freeway, and it should be arriving any minute now.

Of course, this hearing at some point was believed to be held via phone from Paris' end. But the judge said, "Oh, no, no. You need to come in, and in fact, I'm sending a squad car to come pick you up." And a sheriff's deputy did arrive at her home in West Hollywood not too long ago. And she is, indeed, on her way, and she should be arriving at this location where we're watching right now any moment. And when she does, of course, we'll have that live.

In the meantime, we want to take you out to CNN's entertainment correspondent, Sibila Vargas, who is watching of this and has been for the past few days.

She was ordered to do 23 days, Sibila, and only spent, what, about three in jail?

VARGAS: She spent about three in jail, but they're counting it as five. Very interesting. Because Sunday, she went into jail, and she got in at 11:15, so they count that as a day. And then she served some time there Monday, Tuesday, Wednesday and because Thursday she ended up staying there from 12 a.m. to 2 a.m., they count that as an entire day. So very, very strange indeed.

But I've got to tell you, I'm so happy that we do have one of our reporters inside that will be inside that hearing, because that should be extremely explosive, Betty.

Paris Hilton will meet Michael Sauer. Now this is the same judge which sentenced her to 45 days in jail. This is also the very same judge that tore into her back on May 4 during this sentence, basically saying that her excuse of using Elliott Mintz, her publicist, as an excuse to say that that is why she got in the car, while she was driving under a suspended license, violating her probation, he pretty much threw that out the window. And he really, I think, wanted to make an example out of Paris Hilton of what you're not supposed to do.

So it should be extremely explosive inside there. Again, Michael Sauer, the judge who gave her the 45 days in jail, that sentence.

Also, really interesting, is that he was also the judge that said part of the condition was that she does not go home and do home detention. That is not what he wanted.

And he also said that she was not to have an alternate jail plan, so it was very interesting, because she made her way down the red carpet this Sunday before turning herself into jail.

And she said that she had a choice, either to go to a pay jail or not. But Michael Sauer had made the decision that she wasn't allowed to have an alternate jail plan. So it's very interesting.

So it will be interesting to see how the two of them interact, because obviously, there's a lot of things being said that he certainly was not in concert with -- Betty.

NGUYEN: Well, it's going to be interesting, too, to see how the judge reacts to the sheriff's department, where the decision was made by that department to let her out and put her in -- medical consideration, I guess would you call it, and then confine her to her home and possibly have an ankle bracelet there. But the big question that I think a lot of people are still trying to figure out is what is this medical condition? Have we gotten to the bottom of that?

VARGAS: You know, we have not confirmed that. And it was very interesting, because the L.A. County Sheriff's Department spokesperson was not letting us in, basically saying that it's something of a confidential matter. They can't possibly say anything about it, only to say that it wasn't a staph -- that it wasn't staph infection.

Now, apparently spoke to some law enforcement officials that said that it was a psychological condition, that it was not a physical condition, but a psychological condition. But -- and also saying that a psychologist, a very high-end celebrity psychologist, had gone to see her at her cell and basically determined that she was depressed and also on a verge of a nervous breakdown.

Now the outrage has been that, hey, you know what? There's a lot of people in the system that are very depressed that they're in jail right now. They have all kinds of ailments. They have all kinds of diseases. They have all kinds of mental problems, because they're in jail, but they're not sent home because they're not -- because, you know, they're feeling heat. They actually have to spend the time there, because that's what jail is.

And also, that they have a medical unit that is there to provide for these people. And that's what city attorney Rocky Delgadillo, who has really been spearheading this whole hearing. He's the one that really wants Paris Hilton back in jail.

He's been saying that all along. He said, hey, you know, there's a medical unit at this jail facility. Why couldn't they take care of her there?

So it will be interesting to find out what, indeed, this medical condition was.

NGUYEN: And, Sibila, as we're watching for the squad car to arrive, just any minute now. We understand it has already exited the freeway, and it's making its way there to the courtroom.

Another question that really arises, too, is today we heard that the judge had ordered Paris in this hearing in person, and not by phone. A sheriff's car was sent out to retrieve her, and it took hours for Paris to actually be put in that vehicle.

I mean, when you talk about the comparison to what Paris is experiencing compared to, say, any other person in the circumstances when it comes to similar charges, it would not be the same, would you say?

VARGAS: You know, is it -- absolutely. It's just too bizarre. Everything surrounding it is bizarre.

Let's go back to May 4 when she finally did get sentenced. Most people thought that, because she was Paris Hilton, the judge was not going to give her jail time. But she did. She got some jail time.

And what was really interesting was that Kathy Hilton, her mom, made a spectacle of herself outside of the courthouse and inside of the courthouse. Apparently, she had, you know, talked to the prosecutor and also the judge, saying that she wanted their autograph. I mean, who behaves that way?

And then later after that, sometime later, we found out that she was going to be serving, rather than 45 days in jail, that her sentence had been -- come down to 23 days in jail, and they said it was because they anticipated good behavior. But just that whole -- the way that went down, that was really bizarre.

And then on top of that, we also hear that not only is she not -- she's not going to stay with the general population at this jail, but she's staying in a very special -- a special needs housing unit away from that general population, away from any kind of person that might be able to hurt her.

So everyone, you know, scratching their head, thinking what is going on here? Is this girl getting preferential treatment?

And then, you know, it just doesn't get any more bizarre that we hear that, after three days of doing time in jail, she is then let go, free to serve some time at home in her 2,700-square-foot mansion. I think that that is really -- has been the straw that breaks the camel's back.

But as you say, there's even more, you know. She is at home as deputy sheriffs are coming to pick her up, and she's taking hours to get ready before they can actually take her to the -- to the courthouse downtown. So it just defies reason, really.

NGUYEN: Well, and isn't this the same Paris Hilton that said just a few days ago, before she went to jail, that she hopes that this is a lesson to other people that you have to do the right thing?

VARGAS: Yes, she actually did say that. She said that on the red carpet. And she said that also in her statement after they did let her -- they released her from jail so that she could serve time at home.

You know, it was very interesting. Because I have sort of an idealist view of this whole thing. I thought, you know, if she does serve her time, you know, maybe this is the turning point for Paris Hilton.

Maybe she could start a new chapter in her life, serve her time and say, "You know what? I've experienced certain things. I've been around people that maybe I would never have been around. I've learned my lesson. I want a new chapter in my life. I'm going to turn my life around. I'm going to, you know, be known as being a humanitarian, maybe even, you know, an Oscar-winning actress," maybe aspiring to that.

But it's very interesting how this thing has all turned out. You know, I've even heard about her possibly wanting to write a diary and, you know, and profiting off of this.

So everything about this, again, bizarre.

Last -- yesterday, I don't know if you got to see, our producer was out there around her house, staking out her house, and apparently, they had cupcakes sent to her home. So it's just very strange.

NGUYEN: Yes, we're all kind of scratching our heads but still watching indeed. And of course, when she does arrive, we'll bring that to you live here on CNN.

But we are going to take a quick break. There's much more in this saga to come. We've got a lot of other news to tell you about, so don't go anywhere. You are in the CNN NEWSROOM.


NGUYEN: All right. We wanted to bring you another live look at the scenario there in Los Angeles, where Paris Hilton is going to be making a court appearance in person, not by phone.

This is the area that we were watching, this parking garage. And we were expecting her to come via squad car into that garage. You see all of the media there. But they've all left.

Now a little bit earlier, we saw some of them running around the side of the building. Well, apparently, according to our affiliates, that squad car went in a different area and therefore avoided most of the media.

And we are learning from those affiliates, as well, that Paris Hilton is already in the courtroom.

And it's going to be really interesting to see how that goes down inside the courtroom, as the judge is very upset with the situation that has turned out to be, the fact that she was let out early. He wants to know why the sheriff let her out early from jail and sentenced her to home confinement with a monitoring bracelet, which is something that the judge said would not happen, that she would have to do her time in jail. There was no other option.

But after about three days -- they're doing a little interesting calculation, which they're equating to five days -- she is back in the courtroom. And we'll see if she has to endure another 20 days behind bars.

It is all playing out before our eyes, and as soon as we get the information, we will bring it straight to you.

HOLMES: Social status aside, Paris Hilton isn't the only prisoner to leave jail early. Depending on how you view it, early release is either a necessity or it's a travesty of justice. Here's part of last night's "LARRY KING LIVE".

(BEGIN VIDEOTAPE) MARK GERAGOS, DEFENSE ATTORNEY: Remember, this prison system in California, and the jail system in California, are both periodically under federal review for overcrowding. That's what the fundamental problem is here that nobody wants to talk about.

LARRY KING, HOST, "LARRY KING LIVE": Sheriff -- Sheriff Arpaio, what's the -- what's the ruling in Phoenix? Do you have control of when someone gets out, or the judge who sentenced them?

SHERIFF JOE ARPAIO, MARICOPA COUNTY, ARIZONA: No. Once they come in jail, they stay in jail. I don't let them out early.

KING: Never?

ARPAIO: They stay here. Never. Never happened. And I have 10,000 people in jail, 2,000 in these tents. They do the full time, and there's no electronic bracelets or anything like that.

KING: Don't you think some people are entitled to early release?

ARPAIO: Well, I don't know about how early you're talking about. If you get 45 days...

KING: Well, let's say someone gets a year. Might they be entitled to get out in eight months?

ARPAIO: No. That depends if they work. We can give them two for one. I make that decision. I make the decision. That's right.

GERAGOS: Why would you want to keep somebody who's a nonviolent person, at $30,000 a year, incarcerated? What sense does that make in a state that's not...?

ARPAIO: Wait a minute. Wait a minute. I'm tired of hearing about money.

GERAGOS: Well...

ARPAIO: No. See, our meals -- wait a minute.

GERAGOS: You want to pay -- you going to raise taxes?

KING: One at a time.

ARPAIO: Our meals are 15 cents. Our meals are 15 cents, 30 cents a day. These costs cost nothing. OK? So don't give me the money issue.

GERAGOS: It costs $30,000 -- it costs $30,000 a year, minimum.

ARPAIO: Maybe in L.A. it does where you feed them...

GERAGOS: No, it's more expensive real estate than out in the desert, I'm sure.

KING: We lost the sheriff there a moment. Harvey... GERAGOS: They gave him early release.


NGUYEN: Oh, my.

HOLMES: Well, just -- just keep it coming here. This Paris thing has got us all messed up. Defense attorney Mark Geragos and Maricopa County Sheriff Joe Arpaio, who had early release there, you saw on "LARRY KING LIVE" last night.

NGUYEN: We have much more to come, including some other news that we want to tell you about today. A lot of things breaking on top of the Paris Hilton headed back to court situation that we've been following out in Los Angeles. And we're going to bring you up to date on all of that when we come back. Stay with CNN. You are in the NEWSROOM.