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CNN Live Today

Battleground State Ohio; Google Lowers IPO Share Price; Couple With 18 Children Accused Of Physical/Psychological Abuse.

Aired August 18, 2004 - 10:30   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.


DARYN KAGAN, CNN ANCHOR: Let's check the headlines now in the news. A standoff in Najaf could end today. The Iraqi defense minister tells rebel cleric Muqtada al-Sadr and his fighters to surrender or be taught a lesson they'll never forget. If there is a direct assault on the Imam Ali Mosque, Iraqi forces will make it. The latest fighting in Najaf has gone on for two weeks.
John Kerry's about to address the Veterans of Foreign Wars Convention taking place in Cincinnati. Kerry will use the speech to attack President Bush's plan to redeploy as many as 70,000 troops from bases in Europe and Asia. Kerry says the plan reduces forces when the nation is fighting terrorism and also undermines relations with U.S. allies.

An investigator looking into the disappearance of a seven-year- old Arkansas girl says there could be a substantial development today. Searchers will return to a site about 25 miles north of Memphis. Patricia Ann Miles disappeared Sunday. Her occasional babysitter, a family friend, has been charged with kidnapping. Police say the suspect is not cooperating.

Sanibel Island, Florida, reopened today for its residents, but crews are still trying to restore power and there is no drinkable water. Nearly 390,000 people across Florida are still without electricity following Hurricane Charley. In Charlotte County, crews have cleared most of the major roads of debris and power lines, and they're now working on neighborhood streets.

We're going to go to Cincinnati now. That's where John Kerry is getting ready to speak to the Veterans of Foreign Wars Convention. Dan Loathian is covering that speech. He joins us by phone. Dan, good morning.

DAN LOATHIAN, CNN CORRESPONDENT: Well, good morning, Daryn.

As you know, veterans are a key group for not only Senator Kerry, for also President Bush right now. It's almost a statistical tie in terms of the veterans' vote. Senator Kerry, as you mentioned, will be speaking to some 15,000 members of the VFW group. They're having their national convention here in Cincinnati.

And as you mentioned earlier, he will be directly talking about President Bush and his effort to withdraw some 70,000 troops from Asia and Europe. He's expected to say that such a move could impair nation security, particularly in addressing North Korea's nuclear program and in fighting the war on terror -- Daryn? KAGAN: All right, and we will check back with you. Dan Loathian. Also, dip into that speech -- actually, hear most of it as it gets started. Set to start at 10:30, running a bit late. But when Senator Kerry begins to speak, you'll see it live here on CNN.

Meanwhile, John Kerry has come out against an ad attacking President Bush. The new ad by the liberal group moveon.org says the president used his father to get into the National Guard and, quote, "when the chips were down, went missing." The ad followed a commercial questioning Kerry's military record. Kerry called the latest ad inappropriate, saying the campaign should be one of issues and not insults.

The Ohio vote seems up for grabs. You can talk to anyone there, and they'll tell you Ohio is much like the rest of the nation and opinions vary about the top candidates. Our Tom Foreman has more on that.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT (voice-over): With nearly a quarter million jobs lost, more than 5,000 citizens fighting in Iraq, and a serious split in public opinion, Ohio has become one of the most critical battleground states.

PROF. RICK FARMER, UNIVERSITY OF AKRON: Ohio is very much like the country, and Ohio is very polarized, just like the country is.

FOREMAN: And squarely divided Stark County, south of Akron, may be the tipping point. Here, the leading employer plans to close three plants which make precision bearings, dropping 1,300 jobs. Timken says that will keep other divisions growing, other jobs safe.

JIM GRIFFITH, PRESIDENT, CEO, TIMKEN: The only job security is producing something that's of value to your customer.

FOREMAN: But that's no comfort to workers facing unemployment.

BRIAN VERDOORN, TIMKEN EMPLOYEE: Ohio is going to have to find something else at this point, because we're losing the manufacturing jobs. They're going elsewhere.

FOREMAN: On other issues, the divide runs just as deep. Brian Sarver is in Iraq, and his wife Kimberly, even taking care of six kids, is so proud.

KIMBERLY SARVER, HUSBAND IN IRAQ: I think it's awesome. I think it's awesome to fight for your country.

FOREMAN: But Rebecca Jones' brother is fighting, too, and she is so scared.

REBECCA JONES, BROTHER IN IRAQ: We're losing too many. We're tired of seeing our loved ones get hurt, not come home.

PROF. PAUL SRACIC, YOUNGSTOWN STATE: I think voters here and elsewhere in Ohio are looking for anything solid to kind of hang their vote on. And that's kind of been the problem.

FOREMAN: The battle for Ohio is coming down to which reality more voters are living: the dire headlines, closed factories, and losses in combat; or the shiny new malls, growing suburbs, and a winnable war. And the presidency may be decided by which way Ohio leans at the polls.

Tom Foreman, CNN, Canton, Ohio.

(END VIDEOTAPE)

KAGAN: Personal question for you: Do you Google? Well, millions do. Perhaps that's why so many are waiting for the chance to share in the company's success, anxiously awaiting the planned IPO for the Internet's number one search engine.

Our Mary Snow joins us live in New York with details on a deal that isn't as quite as rich as it first looked like it was going to be. Good morning.

MARY SNOW, CNN FINANCIAL CORRESPONDENT: Good morning, Daryn. Yes, and investors are going to have to wait just a little longer. And while you mentioned, millions may be using Google, the question is: Is this search engine really revving up a lot of interest in investment? And it appears that that is not the case.

Now, Google has been conducting a Dutch auction. And today, it came out slashing its price for its offered shares by about 25%. The price range now is between $85 to $95 a share. That's down from $108 to $135 was the previous range. And doing so, the company will be raising less money than expected.

The total shares to be sold, 19.6 million as compared to 25.6. And also, in terms of the money it expects to raise, the market cap now, if this goes in this new range, will be around $25 billion. Analysts are saying that this is a classic sign of weak demand for this IPO.

Now, Google had asked the Securities and Exchange Commission yesterday to declare the registration effective at 4:00 p.m. The SEC did not do that. It did not explain why it did not. However, what we do know is that the SEC is asking for more information about that "Playboy" interview that the two founders of the company did back in April.

That interview was done just about seven days before the company announced that it was going to be going public. And under SEC regulations, there is a so-called quiet period. So, we do know that the SEC is asking for more information about this article.

Now, the next step is that Google has asked the SEC to declare the registration effective today at 4:00 p.m. That would effectively close out the bidding process and pave the way for this company to finally go public. It's been four months in the making. However, as we've learned, that nothing is predictable in this IPO. So, we'll have to wait and see -- Daryn? KAGAN: Except that we find out that the SEC, in fact, does read "Playboy" for the articles. They're reading something that's in there.

Besides that, you know, somebody out there is going, $25 million in -- 24, $25 billion, that's nothing to snuff out. What then does Google -- what does the company take that money -- what does it do with it?

SNOW: Well, most of the money that Google makes is from advertising, because of its search engine. It has generated -- let's see. The last quarter, its revenues were over $1 billion.

And what analysts are saying, too, about this price cut is that many people thought that the shares were priced too high to begin with. And they're saying this is not a huge surprise, because the demand for IPOs in the past couple of weeks has been pretty weak, because the market isn't all that strong right now.

So, they're not seeing it as a huge surprise that the price would be cut on these shares.

KAGAN: All right. Mary Snow in New York, thank you.

SNOW: Sure.

KAGAN: Children who were allegedly made to dig their own graves.

(BEGIN VIDEO CLIP)

DEBRA SCHMITZ, CHARGED WITH CHILD ABUSE: We have never missed a night of giving them a kiss good night.

(END VIDEO CLIP)

KAGAN: But the adoptive mother and father of a children have a completely different story.

And American children allegedly abandoned in another country. Their incredible story and where they are now, still ahead.

(COMMERCIAL BREAK)

(STOCK MARKET UPDATE)

(COMMERCIAL BREAK)

KAGAN: A woman is due in a Houston courtroom next week to explain how her seven adopted children ended up in a Nigerian orphanage. A Texas missionary found the children there last month and alerted U.S. officials. The sick and malnourished children were brought back to the U.S. last Friday. The women apparently had taken the three boys and four girls to Nigeria last October. She then allegedly left them there while she took a job in Iraq as a private contractor. To Tennessee now, one felony count has been dropped against Thomas and Deborah Schmidt, who lost custody of their 18 children because of allegations of physical and psychological abuse. Other charges are still pending and will be presented to a grand jury.

Our Eric Philips has more on the story.

(BEGIN VIDEOTAPE)

SCHMITZ: This time has been unbelievably sad. You just see the swings going back and forth, and they're motionless. And you see the basketball court where there's no children playing basketball.

ERIC PHILIPS, CNN CORRESPONDENT (voice-over): Debra Schmitz and her husband, Tom, say their children were their lives. Now they are gone, all 18 of them.

SCHMITZ: We have never missed a night of giving them a kiss good night.

PHILIPS: That was until June 21, when agents with Tennessee's Department of Children's Services and sheriff's deputies removed the children from the Schmitz's home in rural Tennessee as part of a child abuse investigation. Yellow ribbons now hang beckoning their return.

The youngsters range from 1 to 17 years old, some adopted, some foster children, one biological son, all with special medical or emotional needs. The Schmitzes say taking care of the children was their calling from God.

But investigators say the abuse they inflicted was sinister, such as throwing a knife at a 14-year-old girl, forcing the kids to dig their own graves, or making them sleep in a makeshift cage.

SHERIFF JOE SHEPARD, GIBSON COUNTY, TENNESSEE: I found the cage that was talked about where they made some of the children sleep in that cage at night. We found the graves. We had one of the kids point out the graves.

PHILIPS: Two home-care nurses alerted authority as to what they'd seen. A search warrant affidavit details, quote, "The nurse observed Debbie Schmitz slam the girl's head into the kitchen counter. According to the nurse, Debbie Schmitz was trying to get the girl to admit to something she did not do."

CARLA AARON, TENNESSEE DEPARTMENT OF CHILDREN'S SERVICES: It's when you get reports that are very substantial or that come from professionals that know the children or have some intimate knowledge, those are taken very seriously.

PHILIPS: Though investigators say they have a strong case, the Schmitzes maintain there's no evidence of aggravated child abuse they are charged with.

SCHMITZ: Please, we want our children back.

PHILIPS: Eric Philips, CNN, Memphis, Tennessee.

(END VIDEOTAPE)

KAGAN: And let's take a look at what is on the legal docket today in our look at legal briefs. The pretrial hearing resumes tomorrow in the Michael Jackson case. Yesterday, the psychologist who evaluated the victim was on the stand.

Stan Katz was asked by a Jackson family attorney whether Katz' patients included a private investigator who worked for Jackson's defense team. The judge had already warned the attorney not to follow that line of questioning and hit him with a $1,000 fine.

And in the Scott Peterson double murder trial, Amber Frey faces cross-examination today. She's been on the stand since last week discussing details of her adulterous relationship with Peterson. Jurors heard nearly 12 hours of taped phone conversations between the two.

We're standing by for live coverage of John Kerry's speech to the Veterans of War in Cincinnati, Ohio. Live picture there from hall in Cincinnati, Two days after President Bush addressed the same group. We'll bring you the speech live.

(COMMERCIAL BREAK)

KAGAN: Getting word out of Iraq, CNN has confirmed that Muqtada al-Sadr, the radical Shiite Cleric, has accepted a deal agreeing to end the crisis and the standoff in Najaf. This as the situation there has been escalating over the last couple of weeks, especially over the last day, as the interim government had sent in a delegation yesterday, and Muqtada al-Sadr had refused to meet with that delegation, citing his own security concerns.

But in light of that, the government had threatened to, what they said, liberate the holy shrine and go in and storm the shrine. Before that could happen, CNN has confirmed that Muqtada al-Sadr has agreed to a deal to end the crisis. We're going to get much more on this.

Our John Vause is in Baghdad, and will be able to explain exactly what kind of deal was struck. He'll do that for us at the top of the hour.

Meanwhile, here is some stories making news coast to coast here in the U.S. Beware what you cannot see. This is what happened when a woman in Worcester, Massachusetts, mistakenly drove her car into a sinkhole. The woman thought she was simply driving through a puddle of water, but a nearby water main break had carved a crater into the ground. The woman was six months pregnant. She escaped, so did her passenger, both without injury.

To Lansing, Illinois. A package finally arrives at its destination -- 56 years late! It was sent in 1948 from Belgium. It contained the U.S. flag that was draped over the coffin of a 25-year- old veteran who was killed in World War II. The package was addressed to the man's family, all of whom had left town. Postal workers were finally able to track down a sister in Alabama. They express mailed that package to her.

And in Los Angeles, it is no silly idea to some. The city council wants to ban Silly String from Halloween festivities in Hollywood. The reason: The goo from the string could gum up the storm drain system and eventually land in the ocean. The council voted unanimously in favor of an ordinance banning Silly String. Another vote, though, is needed to make that a final decision.

We are standing by for live coverage, final decision on that, of John Kerry's speech to Veterans of War in Cincinnati, Ohio, two days after President Bush addressed the same group. We'll bring you his speech live.

(COMMERCIAL BREAK)

KAGAN: Pushing for the medal and Olympic ballet? Let's get an update on the action in Athens. Michael Phelps picked up some more hardware in the pool yesterday, setting an Olympic record with a gold, a gold medal performance in the 200-meter butterfly. Another gold in an electrifying freestyle race. Phelps now has three gold and two bronze medals.

In Olympic basketball, the U.S. men's team bounces back. It beat Greece 77-71. The team had lost to Puerto Rico in its opening-day game.

And check out this picture: He's not competing, but the man did draw a crowd. Security officials were not amused by this Canadian wearing a tutu and polka dot tights. He jumped into the pool at a diving event yesterday. He was arrested, by the way, for the stunt. He was fined and later released.

You can keep track of all the Olympic stunts, at least the official ones, by logging on to cnnsi.com. You can track who has won what and who is the latest on whatever, and when it's all happening, again, at cnnsi.com.

(COMMERCIAL BREAK)

(WEATHER REPORT)

KAGAN: The next hour of CNN LIVE TODAY begins right 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 August 18, 2004 - 10:30   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
DARYN KAGAN, CNN ANCHOR: Let's check the headlines now in the news. A standoff in Najaf could end today. The Iraqi defense minister tells rebel cleric Muqtada al-Sadr and his fighters to surrender or be taught a lesson they'll never forget. If there is a direct assault on the Imam Ali Mosque, Iraqi forces will make it. The latest fighting in Najaf has gone on for two weeks.
John Kerry's about to address the Veterans of Foreign Wars Convention taking place in Cincinnati. Kerry will use the speech to attack President Bush's plan to redeploy as many as 70,000 troops from bases in Europe and Asia. Kerry says the plan reduces forces when the nation is fighting terrorism and also undermines relations with U.S. allies.

An investigator looking into the disappearance of a seven-year- old Arkansas girl says there could be a substantial development today. Searchers will return to a site about 25 miles north of Memphis. Patricia Ann Miles disappeared Sunday. Her occasional babysitter, a family friend, has been charged with kidnapping. Police say the suspect is not cooperating.

Sanibel Island, Florida, reopened today for its residents, but crews are still trying to restore power and there is no drinkable water. Nearly 390,000 people across Florida are still without electricity following Hurricane Charley. In Charlotte County, crews have cleared most of the major roads of debris and power lines, and they're now working on neighborhood streets.

We're going to go to Cincinnati now. That's where John Kerry is getting ready to speak to the Veterans of Foreign Wars Convention. Dan Loathian is covering that speech. He joins us by phone. Dan, good morning.

DAN LOATHIAN, CNN CORRESPONDENT: Well, good morning, Daryn.

As you know, veterans are a key group for not only Senator Kerry, for also President Bush right now. It's almost a statistical tie in terms of the veterans' vote. Senator Kerry, as you mentioned, will be speaking to some 15,000 members of the VFW group. They're having their national convention here in Cincinnati.

And as you mentioned earlier, he will be directly talking about President Bush and his effort to withdraw some 70,000 troops from Asia and Europe. He's expected to say that such a move could impair nation security, particularly in addressing North Korea's nuclear program and in fighting the war on terror -- Daryn? KAGAN: All right, and we will check back with you. Dan Loathian. Also, dip into that speech -- actually, hear most of it as it gets started. Set to start at 10:30, running a bit late. But when Senator Kerry begins to speak, you'll see it live here on CNN.

Meanwhile, John Kerry has come out against an ad attacking President Bush. The new ad by the liberal group moveon.org says the president used his father to get into the National Guard and, quote, "when the chips were down, went missing." The ad followed a commercial questioning Kerry's military record. Kerry called the latest ad inappropriate, saying the campaign should be one of issues and not insults.

The Ohio vote seems up for grabs. You can talk to anyone there, and they'll tell you Ohio is much like the rest of the nation and opinions vary about the top candidates. Our Tom Foreman has more on that.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT (voice-over): With nearly a quarter million jobs lost, more than 5,000 citizens fighting in Iraq, and a serious split in public opinion, Ohio has become one of the most critical battleground states.

PROF. RICK FARMER, UNIVERSITY OF AKRON: Ohio is very much like the country, and Ohio is very polarized, just like the country is.

FOREMAN: And squarely divided Stark County, south of Akron, may be the tipping point. Here, the leading employer plans to close three plants which make precision bearings, dropping 1,300 jobs. Timken says that will keep other divisions growing, other jobs safe.

JIM GRIFFITH, PRESIDENT, CEO, TIMKEN: The only job security is producing something that's of value to your customer.

FOREMAN: But that's no comfort to workers facing unemployment.

BRIAN VERDOORN, TIMKEN EMPLOYEE: Ohio is going to have to find something else at this point, because we're losing the manufacturing jobs. They're going elsewhere.

FOREMAN: On other issues, the divide runs just as deep. Brian Sarver is in Iraq, and his wife Kimberly, even taking care of six kids, is so proud.

KIMBERLY SARVER, HUSBAND IN IRAQ: I think it's awesome. I think it's awesome to fight for your country.

FOREMAN: But Rebecca Jones' brother is fighting, too, and she is so scared.

REBECCA JONES, BROTHER IN IRAQ: We're losing too many. We're tired of seeing our loved ones get hurt, not come home.

PROF. PAUL SRACIC, YOUNGSTOWN STATE: I think voters here and elsewhere in Ohio are looking for anything solid to kind of hang their vote on. And that's kind of been the problem.

FOREMAN: The battle for Ohio is coming down to which reality more voters are living: the dire headlines, closed factories, and losses in combat; or the shiny new malls, growing suburbs, and a winnable war. And the presidency may be decided by which way Ohio leans at the polls.

Tom Foreman, CNN, Canton, Ohio.

(END VIDEOTAPE)

KAGAN: Personal question for you: Do you Google? Well, millions do. Perhaps that's why so many are waiting for the chance to share in the company's success, anxiously awaiting the planned IPO for the Internet's number one search engine.

Our Mary Snow joins us live in New York with details on a deal that isn't as quite as rich as it first looked like it was going to be. Good morning.

MARY SNOW, CNN FINANCIAL CORRESPONDENT: Good morning, Daryn. Yes, and investors are going to have to wait just a little longer. And while you mentioned, millions may be using Google, the question is: Is this search engine really revving up a lot of interest in investment? And it appears that that is not the case.

Now, Google has been conducting a Dutch auction. And today, it came out slashing its price for its offered shares by about 25%. The price range now is between $85 to $95 a share. That's down from $108 to $135 was the previous range. And doing so, the company will be raising less money than expected.

The total shares to be sold, 19.6 million as compared to 25.6. And also, in terms of the money it expects to raise, the market cap now, if this goes in this new range, will be around $25 billion. Analysts are saying that this is a classic sign of weak demand for this IPO.

Now, Google had asked the Securities and Exchange Commission yesterday to declare the registration effective at 4:00 p.m. The SEC did not do that. It did not explain why it did not. However, what we do know is that the SEC is asking for more information about that "Playboy" interview that the two founders of the company did back in April.

That interview was done just about seven days before the company announced that it was going to be going public. And under SEC regulations, there is a so-called quiet period. So, we do know that the SEC is asking for more information about this article.

Now, the next step is that Google has asked the SEC to declare the registration effective today at 4:00 p.m. That would effectively close out the bidding process and pave the way for this company to finally go public. It's been four months in the making. However, as we've learned, that nothing is predictable in this IPO. So, we'll have to wait and see -- Daryn? KAGAN: Except that we find out that the SEC, in fact, does read "Playboy" for the articles. They're reading something that's in there.

Besides that, you know, somebody out there is going, $25 million in -- 24, $25 billion, that's nothing to snuff out. What then does Google -- what does the company take that money -- what does it do with it?

SNOW: Well, most of the money that Google makes is from advertising, because of its search engine. It has generated -- let's see. The last quarter, its revenues were over $1 billion.

And what analysts are saying, too, about this price cut is that many people thought that the shares were priced too high to begin with. And they're saying this is not a huge surprise, because the demand for IPOs in the past couple of weeks has been pretty weak, because the market isn't all that strong right now.

So, they're not seeing it as a huge surprise that the price would be cut on these shares.

KAGAN: All right. Mary Snow in New York, thank you.

SNOW: Sure.

KAGAN: Children who were allegedly made to dig their own graves.

(BEGIN VIDEO CLIP)

DEBRA SCHMITZ, CHARGED WITH CHILD ABUSE: We have never missed a night of giving them a kiss good night.

(END VIDEO CLIP)

KAGAN: But the adoptive mother and father of a children have a completely different story.

And American children allegedly abandoned in another country. Their incredible story and where they are now, still ahead.

(COMMERCIAL BREAK)

(STOCK MARKET UPDATE)

(COMMERCIAL BREAK)

KAGAN: A woman is due in a Houston courtroom next week to explain how her seven adopted children ended up in a Nigerian orphanage. A Texas missionary found the children there last month and alerted U.S. officials. The sick and malnourished children were brought back to the U.S. last Friday. The women apparently had taken the three boys and four girls to Nigeria last October. She then allegedly left them there while she took a job in Iraq as a private contractor. To Tennessee now, one felony count has been dropped against Thomas and Deborah Schmidt, who lost custody of their 18 children because of allegations of physical and psychological abuse. Other charges are still pending and will be presented to a grand jury.

Our Eric Philips has more on the story.

(BEGIN VIDEOTAPE)

SCHMITZ: This time has been unbelievably sad. You just see the swings going back and forth, and they're motionless. And you see the basketball court where there's no children playing basketball.

ERIC PHILIPS, CNN CORRESPONDENT (voice-over): Debra Schmitz and her husband, Tom, say their children were their lives. Now they are gone, all 18 of them.

SCHMITZ: We have never missed a night of giving them a kiss good night.

PHILIPS: That was until June 21, when agents with Tennessee's Department of Children's Services and sheriff's deputies removed the children from the Schmitz's home in rural Tennessee as part of a child abuse investigation. Yellow ribbons now hang beckoning their return.

The youngsters range from 1 to 17 years old, some adopted, some foster children, one biological son, all with special medical or emotional needs. The Schmitzes say taking care of the children was their calling from God.

But investigators say the abuse they inflicted was sinister, such as throwing a knife at a 14-year-old girl, forcing the kids to dig their own graves, or making them sleep in a makeshift cage.

SHERIFF JOE SHEPARD, GIBSON COUNTY, TENNESSEE: I found the cage that was talked about where they made some of the children sleep in that cage at night. We found the graves. We had one of the kids point out the graves.

PHILIPS: Two home-care nurses alerted authority as to what they'd seen. A search warrant affidavit details, quote, "The nurse observed Debbie Schmitz slam the girl's head into the kitchen counter. According to the nurse, Debbie Schmitz was trying to get the girl to admit to something she did not do."

CARLA AARON, TENNESSEE DEPARTMENT OF CHILDREN'S SERVICES: It's when you get reports that are very substantial or that come from professionals that know the children or have some intimate knowledge, those are taken very seriously.

PHILIPS: Though investigators say they have a strong case, the Schmitzes maintain there's no evidence of aggravated child abuse they are charged with.

SCHMITZ: Please, we want our children back.

PHILIPS: Eric Philips, CNN, Memphis, Tennessee.

(END VIDEOTAPE)

KAGAN: And let's take a look at what is on the legal docket today in our look at legal briefs. The pretrial hearing resumes tomorrow in the Michael Jackson case. Yesterday, the psychologist who evaluated the victim was on the stand.

Stan Katz was asked by a Jackson family attorney whether Katz' patients included a private investigator who worked for Jackson's defense team. The judge had already warned the attorney not to follow that line of questioning and hit him with a $1,000 fine.

And in the Scott Peterson double murder trial, Amber Frey faces cross-examination today. She's been on the stand since last week discussing details of her adulterous relationship with Peterson. Jurors heard nearly 12 hours of taped phone conversations between the two.

We're standing by for live coverage of John Kerry's speech to the Veterans of War in Cincinnati, Ohio. Live picture there from hall in Cincinnati, Two days after President Bush addressed the same group. We'll bring you the speech live.

(COMMERCIAL BREAK)

KAGAN: Getting word out of Iraq, CNN has confirmed that Muqtada al-Sadr, the radical Shiite Cleric, has accepted a deal agreeing to end the crisis and the standoff in Najaf. This as the situation there has been escalating over the last couple of weeks, especially over the last day, as the interim government had sent in a delegation yesterday, and Muqtada al-Sadr had refused to meet with that delegation, citing his own security concerns.

But in light of that, the government had threatened to, what they said, liberate the holy shrine and go in and storm the shrine. Before that could happen, CNN has confirmed that Muqtada al-Sadr has agreed to a deal to end the crisis. We're going to get much more on this.

Our John Vause is in Baghdad, and will be able to explain exactly what kind of deal was struck. He'll do that for us at the top of the hour.

Meanwhile, here is some stories making news coast to coast here in the U.S. Beware what you cannot see. This is what happened when a woman in Worcester, Massachusetts, mistakenly drove her car into a sinkhole. The woman thought she was simply driving through a puddle of water, but a nearby water main break had carved a crater into the ground. The woman was six months pregnant. She escaped, so did her passenger, both without injury.

To Lansing, Illinois. A package finally arrives at its destination -- 56 years late! It was sent in 1948 from Belgium. It contained the U.S. flag that was draped over the coffin of a 25-year- old veteran who was killed in World War II. The package was addressed to the man's family, all of whom had left town. Postal workers were finally able to track down a sister in Alabama. They express mailed that package to her.

And in Los Angeles, it is no silly idea to some. The city council wants to ban Silly String from Halloween festivities in Hollywood. The reason: The goo from the string could gum up the storm drain system and eventually land in the ocean. The council voted unanimously in favor of an ordinance banning Silly String. Another vote, though, is needed to make that a final decision.

We are standing by for live coverage, final decision on that, of John Kerry's speech to Veterans of War in Cincinnati, Ohio, two days after President Bush addressed the same group. We'll bring you his speech live.

(COMMERCIAL BREAK)

KAGAN: Pushing for the medal and Olympic ballet? Let's get an update on the action in Athens. Michael Phelps picked up some more hardware in the pool yesterday, setting an Olympic record with a gold, a gold medal performance in the 200-meter butterfly. Another gold in an electrifying freestyle race. Phelps now has three gold and two bronze medals.

In Olympic basketball, the U.S. men's team bounces back. It beat Greece 77-71. The team had lost to Puerto Rico in its opening-day game.

And check out this picture: He's not competing, but the man did draw a crowd. Security officials were not amused by this Canadian wearing a tutu and polka dot tights. He jumped into the pool at a diving event yesterday. He was arrested, by the way, for the stunt. He was fined and later released.

You can keep track of all the Olympic stunts, at least the official ones, by logging on to cnnsi.com. You can track who has won what and who is the latest on whatever, and when it's all happening, again, at cnnsi.com.

(COMMERCIAL BREAK)

(WEATHER REPORT)

KAGAN: The next hour of CNN LIVE TODAY begins right 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