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Ex-Playmate Details Alleged Affair; Global Markets Down Sharply; Bracket Busting March Madness; Students to March for Gun Control. Aired 6:30-7a ET

Aired March 23, 2018 - 06:30   ET

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

[06:30:00] (BEGIN VIDEOCLIP)

KAREN MCDOUGAL, ALLEGES AFFAIR WITH DONALD TRUMP: One of the big complaints with why I think my contract is illegal is because his attorney was talking to my attorney. So --

ANDERSON COOPER, CNN ANCHOR: Michael Cohen -- you're saying Donald Trump's personal attorney, Michael Cohen.

MCDOUGAL: Correct.

COOPER: Was talking to Keith Davidson, your --

MCDOUGAL: Speaking with Keith -- Keith, without me even knowing, without my knowledge. I would assume that maybe he knew. I know his attorney did. I can't say that he knew.

(END VIDEO CLIP)

ERICA HILL, CNN ANCHOR: Former "Playboy" model Karen McDougal claiming Donald Trump's personal attorney was involved in an agreement to prevent her from sharing details of her alleged affair with Mr. Trump before he was president. She is suing to be released from that agreement with AMI, which is the parent company of "The National Enquirer."

CHRIS CUOMO, CNN ANCHOR: All right. Let's bring in chief CNN legal analyst Jeffrey Toobin and CNN legal analyst Areva Martin.

It's good to have you both here.

All right, Jeffrey, help me understand why I should care.

JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: Well, I think everybody can make up their own mind about whether they care about Donald Trump having an affair.

What is bizarre and I think serious is the fact that there was this concerted effort and passing of an enormous amount of money, $150,000, to keep her silent during the campaign. I think the -- that -- that is a -- a story of legitimate news interest.

CUOMO: Not by Trump. TOOBIN: Not by Trump.

CUOMO: Not but Cohen, you know, by any indication.

So what would be the relevant, legal consideration?

TOOBIN: Well, see, that's what I find bizarre about this. I don't understand her lawsuit.

CUOMO: That's the bizarre part for you?

TOOBIN: Well, I -- there are many.

CUOMO: Bizarre, I should say, as a legal claim?

TOOBIN: Well, what can I tell you.

CUOMO: Associated --

TOOBIN: You just asked -- you just asked about the -- about the legal case.

Here she has -- she has this lawsuit to let her tell her story. She just told her story. So what's this case about? I just don't get that at all. And so I think, look, you know, we can pretend that there's a legal aspect to this. This is mostly a story about two adults who had an affair, and people can decide whether they care or not.

HILL: Well, in terms of, there are these questions about why does she want to tell her story, I want to play one more part of what she had to say and then, Areva, let's talk about that.

(BEGIN VIDEO CLIP)

COOPER: And what was the thought of selling the story, in your mind?

MCDOUGAL: To get my truth out there. I wasn't looking for money, clearly. But when he said it's worth many millions, I'm like, you know --

COOPER: That was something that was hard to pass up?

MCDOUGAL: Sure. Of course. But if you fast forward, I ended up not wanting to do that deal. So we were going to go to ABC and tell the story, just to get the story out there and -- for nothing. There was no pay.

(END VIDEO CLIP)

HILL: That's been a central question, too, is why -- why do you want to tell the story? What's the point here? And she said, I want to control -- I want to control the narrative here. And now that I'm being told I can't control it, that's why I want to talk. Although, to Jeffrey's point, Areva, we've now heard the story.

AREVA MARTIN, CNN LEGAL ANALYST: Yes, Erica, it's a little convoluted because on one hand she said that, you know, it was a lot of money -- she was being told that she could make a lot of money on telling the story. But on the other hand, as she's negotiating with AMI, she says she was glad that they decided to bury the story because she didn't want to hurt him and she didn't want the story out there. And she liked the idea that she would get to be promoted as a health and wellness or a health and fitness model in their magazines and various media platforms in exchange for them not telling the story.

So although I think it was a very compelling narrative about the relationship with lots of specifics, so no doubt in my mind that the affair occurred. Still not really clear on what the legal issue here is. Simply -- and also we should note that AMI has says you've been free to tell your story, to answer media inquiries since 2016. So they don't appear to be trying to prevent her from telling her story.

So the lawsuit is mysterious. I'll leave it at that.

CUOMO: It's certainly a very different dynamic than we see with Stormy Daniels --

TOOBIN: Very different.

CUOMO: Where you have Trump's personal attorney trying to enforce a bargain for exchange, which is, I give you this and you keep your mouth closed. This is very different. We're not hearing from AMI saying, hey, you had a deal and you're breaching that deal and everything you're saying right now is what it would be, which is in direct defiance to that agreement.

TOOBIN: Right. And, you know, obviously a very different legal situation between Karen McDougal is that that agreement is with AMI, it's not with Donald Trump. Whereas the Stormy Daniels contract is allegedly with Donald Trump.

CUOMO: Right.

TOOBIN: Although he didn't sign the agreement, and that's part of the controversy.

CUOMO: Right. Although you did hear Ms. McDougal slip in that Michael Cohen was talking to my lawyer bit about -- what does that mean? That means that she's trying to implicate -- imply that Cohen may have somehow been part of this deal with AMI, which gets to the central intrigue, legal or otherwise, which is, did a friend of Donald Trump pay somebody money to shut somebody up and squash their story?

[06:35:05] TOOBIN: Well, and I -- and I wrote a profile of David Pecker, the head of AMI, for "The New Yorker," and asked him about this Karen McDougal situation and he said, yes, we paid her because we wanted to help Trump. I mean he was not shy about that at all.

CUOMO: So, wait, he said we paid her because I wanted to kill the story for my friend Donald Trump?

TOOBIN: Absolutely. Absolutely.

CUOMO: So now, Areva, what might that mean? Does that expose Pecker in any way or AMI in any way?

MARTIN: Well, that's one of the arguments that Karen is making, is that she wasn't aware of all of, let's call it, the back room dealings that were happening with regards to the contract that she signed. And she expressed anger even last night in the interview by not knowing, she said, that Michael Cohen was talking with her lawyer. And a part of her lawsuit is that she was fraudulently induced into signing this contract without having full knowledge of Pecker's relationship with Trump, Cohen's contact with her lawyer and his potential involvement in killing the story. So that's a big part of her lawsuit because she's not only suing AMI, she's also saying her lawyer is -- her former lawyer is at fault and should be held accountable for what she calls this fraudulent contract that she entered into with AMI.

HILL: There we go. We're leaving it for this hour, but we have more coming up.

CUOMO: There's going to more --

TOOBIN: Puzzled expressions.

CUOMO: Well, I mean, this is not easy to navigate in terms of its relevance to the American people.

TOOBIN: I know.

CUOMO: The White House doesn't help when they deny the affair because now you make it about a truth issue. Who's telling the truth? So this is a little bit brought upon themselves. And that's part of strategy. But what you deal with and what you don't deal with on a personal nature when you're in politics.

We're going to have more of that interview come up.

We're also going to have counselor to the president, Kellyanne Conway, come on the show. And, look, the main reason to have Kellyanne on is not to talk about a playmate or an affair. She is spearheading the White House efforts at the president's direction to fight opioids in this country. We need to have a discussion about the urgency, about what they see as the remedy, and whether or not it will work. That is a conversation worth having.

HILL: We look forward to that.

Also, we cannot take our eye off the markets, looking at what's happening overnight. Global markets down sharply on fears that President Trump's tariffs on China could trigger a trade war and now China threatening to strike back. We have a live report from Beijing coming up next.

(COMMERCIAL BREAK)

[06:41:25] CUOMO: All right, global markets are down sharply again. And the reason is President Trump's decision to impose tariffs on China. Dow futures are pointing to a big drop at the open. We saw a massive down day yesterday because investors are afraid that these tariffs will be an escalating factor for a potential trade war with China and that China will retaliate.

Matt Rivers live in Beijing with more.

What do we know from there, Matt?

MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: We know that the Chinese have already said that they might put $3 billion worth of tariffs on American exports here to China. We know that there could be a 15 percent tariff on 120 different products, like wine and fruit, a 25 percent tariff on pork. Those are the kind of tariffs that hurt American exporters, that hurts the American economy.

But here's the thing, Chris. Those potential tariffs are not in response to what we saw yesterday. Those potential tariffs from the Chinese are in response to the aluminum and steel tariffs that the president talked about several weeks ago. Those tariffs don't hurt the Chinese economy that much. The tariffs that the president announced yesterday will have an impact on the Chinese economy. So in terms of further retaliation, we could be seeing even stronger tariffs down the road.

We heard from the ministry of foreign affairs here in Beijing earlier today with a strong statement saying that American claims were obviously arrogant and a miss judgment of the situation. The spokeswoman said China will retaliate. We have made it clear. It will -- it is impolite not to reciprocate. So there will be a response from the Chinese. We're just not sure yet in what for.

Erica.

HILL: All right, Matt, thank you.

We are following breaking news in New York. A New York City firefighter dying while battling a five-alarm blaze on a movie shoot in Harlem. Michael Davidson, a 15-year veteran, a father of four, was separated from his unit. He was found unconscious and rushed to the hospital, where he died.

In York, Pennsylvania, two firefighters are dead after a building partially collapsed while they were inside. Officials say Ivan Flanscha and Zach Anthony were trapped inside that burning building. Two other firefighters were also injured.

CUOMO: All right, from sweet to elite. We've gone from 16 to eight. Loyola-Chicago's fairytale ride in the NCAA tournament rolls on. But you have to see how they secured their bid to the next round. The "Bleacher Report" is next.

(COMMERCIAL BREAK)

[06:47:42] CUOMO: Boy, oh, boy, so many March Madness brackets just look like what happens when the puppy gets the toilet paper. But last night's games made it even worse, or better, depending on how you look at it. Prayers answered for Loyola-Chicago's 98-year-old team chaplain Sister Jean.

Coy Wire has more in the "Bleacher Report."

You like that one? When the puppy gets the toilet paper.

COY WIRE, CNN SPORTS CORRESPONDENT: I like that, big dog!

CUOMO: I saw you with that puppy the other day.

WIRE: You know what I noticed at this game last night, Chris, the energy levels of the players, of the fans, and of Sister Jean. She was taking a lot of heat, though, Chris, for her bracket. She picked her own Loyola-Chicago to lose in last night's Sweet 16 game. But she told me yesterday she has a second Cinderella dream bracket she calls it that has her team going to the top. And with 6.2 seconds left, the junior from Jersey, money! Marcus Townes, a three-pointer. More clutch than my Isuzu from the '90s. The dagger in the heart of the Nevada Wolfpack.

Sister Jean's original bracket now busted. But she's not feeling blue about it. We caught up with the 98-year-old star after the game.

(BEGIN VIDEO CLIP)

SISTER JEAN DELORES-SCHMIDT: Custer (ph) said to me as he got off the court, we broke your bracket, Sister Jean. I said, that's fine with me. Let's keep going.

(END VIDEO CLIP)

WIRE: How about Kentucky. Never having lost a Sweet 16 matchup under John Calipari, but that changed thanks to Kansas State. The old Wildcats shocking big blue nation. Barry Brown Jr. putting K-State up for good with 19 seconds remaining. And then a last-chance shot fell shy. No tie for Kentucky. This is setting up a Cinderella date between Loyola-Chicago and K-State. That's tomorrow in Atlanta. Can't wait. Sister Jean still has those glass slippers on. Thank you for that.

HILL: I love that Sister Jean. By the way, just a point to button up Chris' analogy there with the puppy. It's National Puppy Day. So there's that.

Coy, thank you.

CUOMO: He's as cute as a puppy.

HILL: That, he is.

Thousands of students calling for tighter gun control laws gathering in Washington for tomorrow's "March for Our Lives" rally. We'll talk about it with Democratic Congressman Ted Deutch of Florida, next.

(COMMERCIAL BREAK)

[06:53:57] CUOMO: Congress passing a massive $1.3 trillion spending bill that does include some gun control measures, which objectively would be called modest by those who are looking for reform. Tomorrow, thousands are expected at the "March for Our Lives" in Washington, and there will be other echo demonstrations across the country, calling for stricter gun control and changing the rules of access because of what just happened in the Florida high school massacre and so many other times across this country.

Joining us now is Democratic Congressman Ted Deutch of Florida. He will be marching with the students of Marjory Stoneman Douglas High School.

We know that that will be a source of pride for you, but also purpose. And the kids are going to be looking at you and saying, congressman, what did you get done for us? And what are you going to tell them?

REP. TED DEUTCH (D), FLORIDA: Well, first I'm going to tell them that -- I'm going to remind them that everything that's happened so far has happened because of them. That's the important thing here.

Look, we passed a big spending bill yesterday. It included, as you point out, some very modest steps. Lifting the ban on research into gun violence, the stop -- the Stop School Violence Act, which will provide grants to schools to help identify potential threats and have school -- greater school security, and then the fix NICS bill. Those are modest steps, but they're modest steps that would not have been taken -- we've been trying to do even those, but they would not have been taken were it not for this movement that these students have started, which we're going to see play out on the international stage tomorrow in marches in more than 800 cities in the United States and around the world.

[06:55:33] CUOMO: Well, if we look at the politics a little bit more closely, if Democrats had wanted to put up a bill at any time to increase the access of guns in schools and training for teachers who want them, you would have passed that bill. It is no coincidence that that part of the Stop Act and fix NICS are both things that the NRA is in favor of. Expanding the background checks as part of fix NICS in all sales and transactions, that's something the NRA does not want that the Democrats do want and you couldn't get it done. Are you worried about the kids looking at you and say, Ted, I love where your heart is, pal, but you can't get it done for me, you Democrats?

DEUTCH: Yes, no, listen, they're exactly right to look at that and say that this isn't enough. And let me be clear about that, Chris. I'm not saying that, nor should anyone believe people here in Washington who tell you that this is some great victory, that this is the response to what happened at Marjory Stoneman Douglas High School in my community. It isn't. It is -- these are modest steps. And they're modest steps that were done without the NRA trying to stick in terrible provisions like they normally do.

But, you're right, over 90 percent of the country supports universal background checks. Over 90 percent. There's no reason that we shouldn't do that. There's no reason that we shouldn't ban bump stocks. And then, ultimately, when you look at the weapons that are used in these mass shootings, they're semiautomatic assault style rifles, we need to ban those. We need to get those weapons out of our communities. So, no, this isn't the response. This isn't the end. This is just the

beginning. And when the students come here and they march, they're going to send two messages. One, they expect a lot more to get done. And, two, if you're not prepared to work to get those things done, if you're not on the side of these kids and communities and those who have suffered at the hands of these shooters and experienced these mass killings and gun violence all around the country, then you don't belong in your position. You can be with the student, you can be for public safety, or you can be for the gun companies. They're going to make that -- those options very, very clear for my colleagues.

CUOMO: So, what do we know? We know that we have heard that before, right?

DEUTCH: We have.

CUOMO: We also know that it has been a hollow threat. However, you do have an interesting demographic shift going on right now. You have the, I think, biggest portion of the generations coming up right now. Bigger than the baby boomers will be the millennials. And they are really coming into their power band of voting age right now. So these kids, like, you know, we'll show you the cover of "Time" magazine, the faces that have, for unfortunate reason, become household faces. The kids from the high school down there who are saying enough. They're going to be of voting age. And many in their generation and extended generation are of voting age. They don't come out and vote on this issue.

With all due respect, lawmakers have a tendency not to do things out of conscience. They do them out of consequence. And when it comes to gun laws, the people who fight hardest are afraid of losing their seats over it because the NRA will come and get you.

DEUTCH: Right.

CUOMO: And people who believe in Second Amendment rights vote on that issue actively. You need to get people to do the same thing for your cause or you're never going to get it done. Fair point?

DEUTCH: Yes. It's absolutely a fair point, Chris, but it's not -- again, it's not just me who needs to get this done. It's these kids who are going to get this done.

You're right, the 18-year-olds who are part of this movement, who will be voting for the first time, they are making this their issue. But for the 17-year-olds and 16-year-olds and the younger kids still who are an active part of this movement when can't even vote yet, when they can, this will be their issue. But in the meantime, their parents now understand that this is a central issue to them and to their families. What these kids are saying is they've had enough. They shouldn't be afraid to go to school. They shouldn't be afraid, wherever they are in America, that a shooter is going to come into their school. And for kids all across the country who face gun violence on a regular basis, they shouldn't be afraid to walk down the streets. These kids are going to make a difference. And, yes, the NRA likes to always try to assert that they're going to

stay here and they're going to stand up for this extremist view of the Second Amendment that says there are going to be no restrictions, which is false and they know it's false. But they keep pushing so that hopefully they'll shut the debate down. They can't do it this time.

[07:00:01] Look at what Citibank did yesterday when they joined a whole host of companies who have said, we're going to make changes to respond to these kids, to respond to this movement. That's what's happening. There have been big changes outside of Washington.