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Vice President Possibly Named in Civil Suit

Aired July 10, 2002 - 14:21   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.
KYRA PHILLIPS, CNN ANCHOR: Today, the vice president is expected to be named in a civil suit connected to his years at Halliburton. The suit alleges that the company overstated profits, causing massive stock losses. Just yesterday, President Bush called for jail time for just that sort of alleged corporate misconduct. With more on this story, CNN's John King at the White House. Hi, John.

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: Hello to you, Kyra. The vice president's office and the White House at large say Mr. Cheney did nothing wrong and they are confident in the end that that will be proven. But this lawsuit does come at a difficult time for the administration. A conservative group called Judicial Watch filing the lawsuit, it's say, on behalf of shareholders in that company, Halliburton.

It is a Dallas-based energy company. Mr. Cheney was the CEO from 1995 until 2000. The lawsuit alleges that the company, under Cheney's leadership, used faulty accounting practices that overstated its revenues by about $445 million in the period from 1999 through the end of 2001. Again, this suit filed in Miami by a group called Judicial Watch. The head of that organization, Larry Klayman, says this suit is only putting to the test just what the president outlined on Wall Street yesterday, that if you cook the books, you should be held accountable.

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LARRY KLAYMAN, JUDICIAL WATCH: If we can show, and we're confident that we will, that Vice President Cheney broke the law, then that will set an example, a much better example, than the president with his rhetoric tried to set yesterday at Wall Street, that indeed everyone will be held accountable for these kinds of excesses.

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KING: Now, you see Cheney here with then Governor Bush back during the campaign. He was the CEO of Halliburton at a time he was helping then Governor Bush and candidate Bush look for a running mate when Mr. Cheney decided that he would accept Mr. Bush's offer and himself become the vice president nominee. He resigned as CEO of Halliburton. The Securities and Exchange Commission is also looking into the accounting at Halliburton in part during Cheney's tenure. That investigation is underway in Dallas. At the White House today, Press Secretary Ari Fleischer, asked about the lawsuit filed today, said he believes the vice president did absolutely nothing wrong.

(BEGIN VIDEO CLIP)

ARI FLEISCHER, WHITE HOUSE PRESS SECRETARY: The suit is without merit and, as you indicate, this is a suit filed vis-a-vis Halliburton, and it is appropriate to address any further questions to Halliburton.

(END VIDEO CLIP)

KING: Halliburton also issuing a statement. It's chief financial officer saying, quote, "the claims in this lawsuit are untrue, unsupported and unfounded. We are working diligently with the Securities and Exchange Commission to resolve its questions regarding the company's accounting procedures." That statement goes on to say, "Halliburton has always followed and will continue to follow generally accepted accounting principles."

Now, sources tell us that the SEC has been in Dallas investigating all this. No contact with the vice president, no efforts to interview the vice president himself. At the company and in the vice president's office, they hope that investigation is resolved quickly, and they believe that when it is resolved, it will have an impact on these lawsuits and that these lawsuits will be found to be unwarranted -- Kyra.

PHILLIPS: Can you give us a little of bit background behind the Judicial Watch, John? And isn't this the same group that chased Clinton quite a bit?

KING: It is. It is a group -- Larry Klayman is a conservative activist. He runs the group here in Washington. Some Democrats and even some Republicans consider the group to be a nuisance and they believe Larry Klayman likes publicity and that he uses these lawsuits for fundraising. But he has also filed some lawsuits over the years that have led to some significant revelations.

He is currently not only suing the vice president in this case, but suing for records of the Cheney energy task force here. And during the Clinton administration, he filed a number, more than a dozen lawsuits against the Clinton White House, and in some of them, did win access to e-mails. And it turned out that dozens, if not hundreds, of e-mails about Monica Lewinsky, about other things in the Clinton White House that were under investigation that should have been turned over to congressional investigators or the Ken Starr investigation actually were not. So, he's a controversial figure here in Washington, but some of his lawsuits have led to interesting revelations.

PHILLIPS: John King live from the White House. Thank you.

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