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The Situation Room

Drug Agents Join Jackson Death Probe; Interview With Marcia Clark

Aired July 02, 2009 - 18:00   ET

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

SUZANNE MALVEAUX, CNN ANCHOR: We are standing by to hear from a lawyer for Debbie Rowe, the birth mother of two of Jackson's children. We are expecting to learn if she is going to fight for custody.

Under scrutiny right now, every note, every move in this just- released video of Jackson's last dress rehearsal for his comeback tour. Look and take a listen.

(BEGIN VIDEO CLIP)

(MUSIC)

UNIDENTIFIED MALE: Hold for applause. Hold for applause. Slow (OFF-MIKE) Fade out.

(END VIDEO CLIP)

MALVEAUX: And we are about to bring you a rare look inside the home that came to symbolize Jackson's lavish and bizarre life. CNN's Larry King takes us behind the gates of Neverland.

Now to Los Angeles, where we are waiting to hear from the lawyer of Jackson's ex-wife and the birth mother of two of his children. Will she challenge Jackson's mother for custody?

CNN's Don Lemon is in Los Angeles.

And, Don, what do we know about this? What do you know?

DON LEMON, CNN ANCHOR: It is very interesting, Suzanne.

We are learning new information now, because, as we understand, the lawyers, the attorneys for Debbie Rowe, Michael Jackson's ex-wife, is having a conference call with the media as we speak. And so we are going to learn some new information from that. If that call is indeed going on, it was supposed to happen at 3:00 Pacific time. If it is going on, we will get back to you on exactly what is happening.

I just want to show you here, we woke up to this headline here in "The Los Angeles Times." It says, an estranged mother reconsiders her role. And, Suzanne, as you know, all week, I have been reporting that Debbie Rowe could have some rights when it comes to whether or not she can get custody of her children.

We know Katherine Jackson filed for temporary guardianship of those children. But if Debbie Rowe has not completely relinquished her parental rights, then she would have some rights to possibly getting the children.

Now, the specifics in all of this, we don't know. We do know that, Monday, July 6, there was supposed to be a court date where Katherine Jackson was to go in to find out about getting permanent custody of those children. And, so, that has been moved now to July 13. And, again, we are waiting to hear from Debbie Rowe's attorneys.

We have been speaking to attorneys who have been taking a look at these temporary guardianship papers that Katherine Jackson filed earlier in the week. And they have some very interesting things to say about what Debbie Rowe's legal rights or access may be to the children. Take a listen.

(BEGIN VIDEOTAPE)

LEMON: Does Debbie Rowe have any recourse in any of this? Can she get custody of the children?

UNIDENTIFIED FEMALE: Debbie Rowe -- the issue with Debbie Rowe is whether or not her parental rights were terminated. And, if they weren't terminated, she still has legal obligations as a parent.

And she has legal obligations to support those children. But at the same time, if she is, she will have priority as a mom to be able to take those children to live with her. And that's called the guardianship of the person.

But, in terms of whether or not she will financially benefit, that remains to be seen. But her lifestyle may actually improve if the children actually live with had.

LEMON: Because she has to keep the children living in the lifestyle that they have grown accustomed to?

UNIDENTIFIED FEMALE: That's correct.

(END VIDEOTAPE)

LEMON: Now, although Michael Jackson said specifically in the will that he was making no provisions for Debbie Rowe, if she does -- if she is able to legally get some sort of custody of the children, then she will have access to whatever moneys become available to keep the children in the lifestyle that they have grown accustomed.

So, we are waiting for a conference call that's happening right now with her attorney. And, then again, that hearing, Suzanne, that was supposed to be on July 6, which is Monday, it has been moved to July 13 since this new angle has come about.

I just want to tell you really quickly, we are standing here in front of the Staples Center. As you know, you showed that exclusive video that we had earlier of Michael Jackson. Now all of the other media organizations have it. But we had it first here talking about the Staples Center and his -- him performing and rehearsing here.

And you saw his last -- one of his last rehearsals. I just want to tell you, if it does happen that Michael Jackson has a viewing service here, some sort of tribute here, the Staples Center only holds 20,000 people. And they are concerned that they may not be able to hold all of the people who are going to be coming here for Michael Jackson -- for a tribute to Michael Jackson.

And we do know they have ordered monitors, big-screen televisions and what have you, speakers to go outside of the Staples Center for all of the overflow crowd that comes out. Again, it is only a 20,000- seat arena for basketball, 1,850 for hockey, and then there are 2,400 premier stands, just a little bit, about three restaurants, 24 concourse stands.

But they don't know -- when I spoke to them on the phone just a couple of days ago, they said, we don't know about -- what about season ticket holders? How do we sell tickets? How do we get people in? How do we work security on an event that would be as last-minute as this one?

Suzanne, so still a lot of details to work out here.

(CROSSTALK)

LEMON: I'm sorry?

MALVEAUX: Don, do you get a -- I'm sorry. Do you get a sense -- are people already beginning to gather at the Staples Center? Are they already beginning to try to jockey or is it just a little too early?

LEMON: It is a little too early, because there has been so much back and forth about exactly what is going to happen, where there's going to be a tribute, and whether there's going to be a public or a private memorial service. We saw people starting to gather at Neverland.

They haven't started to gather here. People have been coming by and screaming, you know, "Where is Michael Jackson?" tourists or what have you, but no, like, official big gathering just yet, Suzanne.

MALVEAUX: OK. Thank you, Don.

I am just getting information now from that conference call that you were referring to with Debbie Rowe's lawyer and what has come out of that. And what we understand is that Debbie Rowe has not reached any decision regarding the custody of the two children, that -- she is the parent of the two older of the three Jackson children, that, according to her lawyer, she has not reached any decision regarding this, that she is going to keep quiet on the matter until further notice.

So, this is what is coming from her camp, from Debbie Rowe.

What do they do now? This is -- they have extended the deadline here for this hearing. What does this mean, Judge Larry Seidlin?

LARRY SEIDLIN, FORMER BROWARD COUNTY CIRCUIT COURT JUDGE: Well, that's the problem, is, in the court system, there's delays; there's continuances. And the Jacksons' attorneys knew that there would be continuances. But they're sitting with the children now. And who knows if the hearing will even take place in July? Because you have got to take depositions. You're going to have to look at all the evidence.

But, meanwhile, time is a friend to the Jacksons, because they have the three children. And it's going to work to their benefit.

MALVEAUX: Now, Judge, I want you to hang on for a minute while we listen to the recording. This is the attorney for Debbie Rowe who just spoke to reporters through this conference call. Here is what he said. Let's listen, if we can.

(BEGIN AUDIO CLIP)

UNIDENTIFIED MALE: I am representing to you now unequivocally Debbie has not reached a final decision concerning the pending custody proceedings.

Many of you know my belief is that the pending custody proceedings are the most private and the most sensitive of matters, as they impact the lives and the fates of young children.

And, to that end, I have endeavored out of respect for Michael's children and family, especially in this time of grieving, to keep silent on these matters, to deny all interview requests, and to share only that information involving upcoming court proceedings.

(END AUDIO CLIP)

MALVEAUX: Why do you suppose they did this? She is not offering really any information except to say she hasn't made a decision. Is this basically to just kind of throw off all the reporters and the requests and all this or does this signal to you anything that she might be thinking about doing legally?

SEIDLIN: When you have a high-profile case, you not only have to win in the courtroom. You have to win in the court of public opinion.

And I think it would have been inappropriate at this time for her to act like she is in a laundromat fighting for the laundry. She is doing it appropriately, through her attorney.

I remember, when I invited Howard Stern into my courtroom, and he was in the Bahamas, and I knew he would take my invitation. I would bet you that she will eventually file an application, a motion to have custody of these children.

MALVEAUX: And, Judge, I just want to remind our audience your role in the case that you played.

You presided over the custody battle of the children -- the child of Anna Nicole Smith, and that was essentially a very high-profile situation. There were a lot of active players that were involved. It was a complicated and very emotional case for so many people. And you were dealing with a celebrity. You were dealing with multiple legal issues as well, that kind of back and forth, that fight over that custody of that child of Anna Nicole Smith.

When you see this play out, how do you see this playing out, now that we know that Debbie Rowe is not -- she is not necessarily out of the picture? She is just saying, wait a minute. Hold on. I am going to think about this.

SEIDLIN: Judges are different throughout the country. You need a judge with a lot of guts to be able to resolve this.

When I held court in my courtroom, and I was there a long time. Probably my whole adult life I was a judge. I was elected at 28. I went in with the thought, what am I going to do to make the children have a better life? That was always my goal.

Now, it is interesting. Your turn on my case was that it was over the custody of Dannielynn. It was really where the bodies should be buried.

MALVEAUX: Sure.

SEIDLIN: I turned it into what's best for the little girl, Dannielynn. That's the way I changed it.

But, remember, when you didn't see me in the courtroom, I was in my chambers. I was talking to the parties with the attorneys. I was massaging those parties. I was trying to lubricate it, where I got a good conclusion.

And many judges aren't as active. I was always proactive with my cases. And...

MALVEAUX: This case, obviously, it's going to take a lot. Do you feel that that's true?

SEIDLIN: Yes. It means the judge is going to have to really get involved and mix it up. And in family court and probate court, you have to be proactive to do the best thing for the family. Now, it is interesting. This is going to be in probate court because it is a guardianship.

MALVEAUX: OK.

(CROSSTALK)

SEIDLIN: And it will have an interesting experience for the judge.

MALVEAUX: All right, Judge Larry, thank you so much for your time once again.

SEIDLIN: Well, thank you.

MALVEAUX: All right. Thanks. Now to the investigation into Michael Jackson's death. Federal drug agents now are playing a role amid growing questions about whether Jackson's medications might have killed him.

Drew Griffin of CNN's Special Investigations Unit, he is joining us.

And, Drew, tell us what you have learned.

DREW GRIFFIN, CNN INVESTIGATIVE CORRESPONDENT: Well, Suzanne, it is not unusual for this to happen.

But the LAPD yesterday asked that the DEA's Drug Diversion Unit get involved in this, because now it seems they are focusing on those medications that were either found in Michael Jackson's body or found in his home.

We are talking about prescription medications, medications delivered to him through a pharmacy or through a doctor. The DEA will be tracing those medicines back to find out who was doing the prescribing, under which names, and also the supply, whether that supply of drugs was consistent with a medical condition or whether or not it was an oversupply.

Again, it's not unusual, but it does change the focus of this investigation slightly in the cause of death. And, as for the cause of death, I did talk with the L.A. County Coroner's Office today.

And, Suzanne, as we all wait in this 24/7 news cycle to find out what caused the death of Michael Jackson, the coroner sticking to his original timetable, four to six weeks before his examination will be made public. That puts us at the end of July, early August -- Suzanne.

MALVEAUX: OK. Drew, thank you so much -- Drew Griffin.

Jack Cafferty is joining us this hour with "The Cafferty File."

And, Jack, what are you following?

JACK CAFFERTY, CNN ANCHOR: The state of California is on the brink of a financial meltdown. Once the richest station in the union, California has run out of money. And it is being forced to issue billions of dollars of IOUs to taxpayers, county agencies, and small businesses.

California's deficit was already $24.3 billion. And the failure of the state legislature to agree upon cost-cutting measures has caused the deficit to grow by another $2 billion. Nice job there in Sacramento.

Republican Governor Arnold Schwarzenegger wants to use deep spending cuts and borrowing. The Democrats are pushing for tax hikes and less severe budget cutbacks. Schwarzenegger has declared a fiscal emergency and he is giving lawmakers 45 days to figure things out. He's also ordered state employees to take a third unpaid day each month, which brings their total pay cut this year to about 14 percent so far.

Meanwhile, the IOUs could wind up causing a lot of damage, especially for small businesses that rely on state contracts. Counties will have to find other ways to fund social programs, including those for alcohol abuse, mental health and services for the elderly and disabled.

And California's universities will look for other ways to help students who won't get state grants. The federal government is threatening to seize six California state parks if they are closed to help balance the state's budget.

California's deepening financial crisis could be a preview of things to come for other states as money dries up and citizens brace for tax increases and cuts in services.

So, here is the question. What ought to be done about California's disastrous -- and it is disastrous -- financial situation? Go to CNN.com/caffertyfile. And let's solve this thing before 7:00.

(LAUGHTER)

MALVEAUX: OK, thank you, Jack. We will see if we can do that.

A Jackson brothers first -- extended interview from a family member. Get this. Jermaine Jackson says he is in so much grief, he wishes he died instead of Michael Jackson. Wait until you hear him explain.

Could this tragedy cause the trial of the century. Marcia Clark thinks it might. She was a player in arguably the trial of the last century, O.J. Simpson's trial. Marcia Clark is here.

And Jackson long called it home. We are awaiting video from inside Neverland. You will see what we have.

(COMMERCIAL BREAK)

MALVEAUX: New reflections from President Obama on the life and death of Michael Jackson. The president was asked about the music superstar during an interview with Associated Press.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I think that Michael Jackson is -- will go down in history as one of our greatest entertainers.

I grew up on his music, still have all -- all his stuff on my iPod. You know, I think that his brilliance as a performer also was paired a tragic and in many ways sad personal life.

But, you know, I am glad to see that he is being remembered primarily for the great joy that he brought to a lot of people through his extraordinary gifts as an entertainer.

(END VIDEO CLIP)

MALVEAUX: Michael Jackson's brother, Jermaine, is now speaking out and answering questions about his brother's reported drug use.

Here is our CNN's Mary Snow -- Mary.

MARY SNOW, CNN CORRESPONDENT: Suzanne, Jermaine Jackson got tearful at times and, in an interview with NBC, he said he would be hurt if toxicology tests show his brother was abusing prescription drugs.

(BEGIN VIDEOTAPE)

JERMAINE JACKSON, BROTHER OF MICHAEL JACKSON: And may Allah be with you Michael always. Love you.

SNOW (voice-over): One week after Jermaine Jackson delivered the news of his brother's death, he is the first family member to talk more in-depth about Michael Jackson.

In an interview with NBC's "Today Show," he recounted hearing his mother crying on the phone, telling him Michael was dead. And he grew emotional when he described how he rushed to UCLA Hospital.

(BEGIN VIDEO CLIP, "THE TODAY SHOW")

J. JACKSON: Seeing him there lifeless and breathless was very emotional for me. And this sounds strange, but he went too soon. He went too soon. I don't know how people are going to take this, but I wish it was me.

MATT LAUER, CO-HOST, "THE TODAY SHOW": Why do you feel that way?

J. JACKSON: Because I have always felt that I was his backbone, someone to -- someone to be there for him.

(END VIDEO CLIP)

SNOW: Jermaine Jackson was asked whether he would be shocked if toxicology reports showed his brother used or abused prescription drugs.

When directly asked whether it was possible, he gave this response.

(BEGIN VIDEO CLIP, "THE TODAY SHOW")

J. JACKSON: I really don't know, Matt. I really don't know. And I'm being honest. I really don't know. But I do know this, that Michael was always concerned about just everybody. And, to have that weight on your shoulders, and to have that kind of pressure, I don't know. I don't know.

(END VIDEO CLIP) SNOW: But Jermaine Jackson has left no doubt about his belief in his brother's innocence when he faced child molestation charges in 2005 and was acquitted.

It's something Jermaine has been adamant about over the years, including in this interview with Larry King three years ago.

(BEGIN VIDEO CLIP, "LARRY KING LIVE," MARCH 6, 2006)

J. JACKSON: You know where my heart has been since day one. Michael's been 1000 percent innocent. I have spoke from my heart. I have spoken the truth.

(END VIDEO CLIP)

(END VIDEOTAPE)

SNOW: Now, Jermaine Jackson also said he wants Neverland to be the final resting place for his brother. And asked about whether his 79-year-old mother, Katherine, is capable of taking care of Michael Jackson's three children, as stipulated in his will, Jermaine said she is definitely capable -- Suzanne.

MALVEAUX: OK. Thank you, Mary.

And a prime-time exclusive -- CNN's Larry King will take you to the Neverland Ranch tonight. He will be joined by Jermaine Jackson. That is "LARRY KING LIVE" tonight at 9:00 Eastern right here on CNN.

Well, Michael Jackson long called it home. Many fans are there to mourn. We are keeping an eye on Neverland. We will show you some of Jackson's unusual items he kept there.

The vice president flies into the zone of danger. You should know why Joe Biden went to Iraq.

And Governor Sanford's wife details how much her husband's cheating and lying hurt. But then Jenny Sanford says something that may surprise you.

(COMMERCIAL BREAK)

MALVEAUX: You're in THE SITUATION ROOM.

Happening now: Worse-than-expected job losses in June. Republicans want to know, where are the jobs? We will see what the White House is saying.

Michael Jackson's memorial is planned for Tuesday at the Staples Center in Los Angeles, but the city and state are near broke. So, who is going to cover the cost?

And new video of Michael Jackson rehearsing just two days before his death -- all of this, plus the best political team on television. I'm Suzanne Malveaux, and you are in THE SITUATION ROOM.

We are learning new details about the memorial service for Michael Jackson and about the trust that he has established.

CNN's Ted Rowlands is outside Jackson's Neverland ranch.

Ted, what are we picking up there?

TED ROWLANDS, CNN CORRESPONDENT: Suzanne, after several days of planning, Michael Jackson will be remembered in a public ceremony on Tuesday in Los Angeles at the Staples Center. This is a 20,000-seat venue where the Los Angeles Lakers play basketball.

We are told by a source familiar with the plans that there will also be opportunities for people that don't get into this ceremony to take part by viewing on outside monitors.

Meanwhile, we are also getting more details on the will which was publicly filed in court, the only known will at this time written by Michael Jackson. It is from 2002. The public document says that all of Jackson's assets go into this Jackson trust.

Well, what does that mean? What is the trust? Well, a source who has seen these documents tells us that the trust, itself, consists of three components. Forty percent of the trust goes to -- is controlled by Katherine Jackson, Michael Jackson's mother, but it's controlled in a life estate, meaning that, when she dies, her interests automatically reverts back to her -- to Michael Jackson's children.

They have 40 percent of the trust off the bat. They will get 80 after, of course, Katherine Jackson passes. And then the remaining 20 percent goes to charities.

But what's interesting is Michael Jackson did not designate which charities. In his will, he says according to our source that the charities will be chosen by the executors of his will. Also, some things of note -- no additional beneficiaries were named by name and no instructions on death, what he would have wanted to happen in terms of burials and ceremony -- Suzanne.

MALVEAUX: Thank you, Ted.

The breaking news on Michael Jackson this hour -- his ex-wife, Debbie Rowe, reveals she has not reached a final decision on whether to fight for custody of Jackson's two oldest children -- that word from her lawyer just a short while ago.

A judge has ordered a week delay in a hearing to decide if Jackson's mother, Katherine, will remain temporary guardian of his children, that hearing now set for July 13.

Joining me now, someone who knows firsthand about high-profile celebrity legal battles. Marcia Clark was the prosecutor in the O.J. Simpson trial in 1995.

And thank you so much for joining us here in THE SITUATION ROOM.

I want to address something that you wrote in "The Daily Beast." It has gotten a lot of attention, because, essentially, you say that this could be the new trial of this century. You know what it's like, doing the O.J. trial there.

And this is the reason you give. You say: "I'm a big believer in personal responsibility. But that doesn't mean we don't punish criminals who abuse their special access to dangerous drugs. If we punish crack dealers, then we punish sleazy doctors."

Why did you write this? Do you think that this is going to end up being a case of enablers, of doctors who misprescribed, overprescribed prescription drugs for Michael Jackson?

MARCIA CLARK, FORMER PROSECUTOR: I think it very well could be, Suzanne.

I mean, right now, the way it looks, this was a man who, I don't know if he was in perfect health. Certainly, when I last saw him during the 2005 trial, he did look frail. But he was alive. And he was well enough that he passed an insurance exam, and he was about to go on a 50-date concert tour, which tells me that he had no -- there was no indication that there was anything terribly wrong with him or any natural cause that would have caused his death in such an untimely manner.

And that seems to suggest that there were drugs involved. And if those drugs turn out to be the ones that have been discussed so far in other reports, Diprivan, which is a very powerful anesthesia used only in hospitals, and could not even have been prescribed, but had to have been passed from a -- a hospital, a doctor, or a nurse, or Demerol in large quantities, that indicates that there is prescription abuse. That indicates that there is a doctor somewhere in the mix, a nurse somewhere in the mix who has the access to the kinds of drugs that no average person could get and that likely did lead to Michael's untimely death.

And if that's true, I hope they're prosecuted to the fullest extent of the law.

MALVEAUX: What do you make of the fact that the D.A. is now involved in the investigation of Michael Jackson's death?

CLARK: It's entirely appropriate. I'm very -- I was very cheered, very glad to see that that was happening. I understand that they have also brought in the Drug Enforcement Administration, the DEA. So we have federal involvement, as well.

All of this is good news to me, because I think they'll get to the bottom of this.

The autopsy will tell us a great deal. And then there is the investigation into the doctors that had access to Michael, the prescriptions that were written for him -- in what quantities and what numbers and by whom. All of this will tell us a tale as to what exactly happened and what led to Michael's death.

But at this moment, I'm extremely suspicious that there was some wrongdoing here.

MALVEAUX: Is there an appetite in the law enforcement community in Los Angeles to deal with this issue or this problem?

It sounds like you -- you feel pretty strongly that this needs to be addressed.

CLARK: I really do. I -- I think Jerry Brown -- Attorney General Jerry Brown set the tone. I think he's 100 percent right in prosecuting the people that provided Anna Nicole with the drugs that they did. And her autopsy reveals that she did, indeed, die of prescriptive drug overdose. The prescriptions, some of them were written, were fraudulent and obviously dummied up in an illegal manner. The communications that were between her boyfriend and the doctor and psychologist who were involved in the prescriptions show they knowingly violated laws to prescribe these drugs for her.

And that set the tone. That indicates that we are not just going to sweep this under the rug because it's a Hollywood abuse. It's a crime. It's a crime that is -- that seems to be occurring more and more frequently. Prescriptive drug abuse has now, to me, overtaken, almost, the illegal drug trade in this country.

And it's something that needs to be addressed. It's a very serious abuse. And when these doctors have access to celebrities who are in need, who are anxiety ridden -- I think Michael Jackson is a prime example of a vulnerable celebrity who was, indeed, under the gun for the concert dates that were coming up, maybe felt unable to deal with it on an emotional level, needed to sleep, couldn't sleep.

MALVEAUX: OK...

CLARK: Anyone like Michael would have known that sleep would deprive him of the ability to perform. He's a perfectionist.

MALVEAUX: OK...

CLARK: He's vulnerable and somebody who would have been a likely target for this.

MALVEAUX: All right. Thank you so much.

Marcia Clark.

Appreciate it.

Joining us here in THE SITUATION ROOM.

CLARK: Sure.

MALVEAUX: Coming up, inside Neverland, Michael Jackson's former home.

Our Larry King is there.

Also, a massive memorial service is planned for Michael Jackson in Los Angeles Tuesday. But who's going to pay for it -- the city and the state are broke.

(COMMERCIAL BREAK)

MALVEAUX: We're getting brand new pictures right now inside the Neverland Ranch of Michael Jackson. We are just getting these pictures, seeing them for the first time.

I want to bring in Stuart Backerman. He was a spokesman for Michael Jackson back in 2002. He has intimate knowledge of the Neverland. And he joins us on the phone.

And, Stuart, we are looking at these pictures. I want to describe it for you. But we are seeing inside the home, what looks like the second floor, a chandelier and hardwood floors looking out.

Can you describe what it was like inside this very precious place for Michael Jackson?

STUART BACKERMAN, FORMER JACKSON SPOKESMAN: Neverland was just amazing, Suzanne. It really was. You know, beyond the aesthetics and what it looked like -- beautiful landscaped gardens -- as soon as you walked through the property, the inner gates opened up and "Fantasia music wafted through the grounds. Right inside of the gates was a confectionary where kids were able to get an unlimited amount of candy and ice cream and cotton candy and popcorn. They gave out bags of these confectionaries at the gate so kids could actually take some home.

It was just an amazing place. This house, of course, was where he resided. And what I'm looking at now is Michael's bedroom area upstairs. That's the bathroom I'm looking at now in the upstairs area.

And it -- it was just amazing, Suzanne. It really was a precious place. And I feel just very fortunate to have had the opportunity to be there.

MALVEAUX: And I want to bring in our own Larry King, who's actually -- who's actually there. And he's taking a look. He's been inside -- and, Larry, we're just seeing these pictures for the first time.

Can you describe for us what it's like?

It looks like they took away a lot of the -- the furniture, the things inside of the home.

But what did you see?

LARRY KING, CNN ANCHOR: And the thing that has surprised me most is -- I didn't know what to expect (AUDIO GAP).

MALVEAUX: We're having a hard time hearing you, Larry.

We're going to get back to you in just a minute.

Do you want to try again, Larry?

KING: Dave?

(AUDIO GAP)

MALVEAUX: OK. We'll get back to Larry.

Stuart, we're looking at a do not touch volume. It looks like a control or something on a wallpapered wall there, colorfully.

Can you describe what that is?

Was that a security system?

Did he have an intercom system inside of the house?

BACKERMAN: It was both. It was a security system and an intercom system -- not the intercom system from the upstairs area to the main floor, where his library was, the kitchen was and various other rooms.

MALVEAUX: How many floors are inside of this -- his home?

BACKERMAN: There were three. There was the main floor. Then there was one level up and then an additional level up. So three floors in the main house. And just kitty corner to the main house was four beautifully appointed cottages where I stayed when I was there and Elizabeth Taylor and his parents and various close people and associates stayed, right adjacent, as I say, kitty corner to the main house.

There we are. We're now looking at the main house. And the cottages were just on the other side of this picture. And it was, you know, just really beautiful.

I'll just never forget -- just very, very briefly -- the night of his 45th birthday, or actually about a week after his official 45th birthday. We rolled out a big birthday cake.

To make a long story short, we had an incredible food fight where Aaron Carter took a piece of Michael's 45th birthday cake and rubbed it in Michael's face. And then Michael said, you're not going to get away with that, and he rubbed it into -- back into Aaron Carter's face. And then I got involved.

And there was about 60 people who had just sung "Happy Birthday" to Michael in this huge food fight. And I remember...

MALVEAUX: (INAUDIBLE)...

BACKERMAN: And I remember looking over to him and saying, this is the way it should always be, because he was squealing with joy.

And it was really quite a memory for me.

MALVEAUX: Stuart, I want to bring back in our own Larry King, who went on a tour of the grounds -- can -- Larry, you were telling us something that surprised you or struck you during your tour.

KING: Yes, Suzanne. I was stricken -- I guess is the word -- by the beauty of Neverland. I had no idea what to expect. And, frankly, I was expecting rides and a little bit of a Disneyland kind of concept. Of course, I've seen nothing of that. The rides are a little distance away from where we'll be broadcasting tonight.

But this is a lovely, lovely place. It's a place of -- serenity is the word I'd use -- the beautiful fountains. We're going to show you shots of the -- of the tree -- the tree where he wrote "We Are the World." It's one of the most beautiful trees I have ever seen.

This is a magnificent setting. What a piece of landscaping. What grounds. I had no idea, Suzanne. I had no -- I didn't know what really to expect, but I did not expect this.

I'll tell you how peaceful it is, Suzanne.

I'm not going to wear braces tonight.

(LAUGHTER)

MALVEAUX: Really?

KING: I'm going to -- I'm going to have an open shirt. There's no need -- you would feel ridiculous with a tie here. This is just -- I can't tell you -- Suzanne, you ought to come out.

MALVEAUX: I -- I would love to. I would love to. And, really quickly, you spoke with Jermaine.

Do you have a headline for us on your -- that conversation?

KING: Jermaine is going to be -- he'll be with us throughout almost the whole -- practically the whole hour. He'll be sort of a co-host. We'll show you other scenes.

And Jermaine is -- well, I'll tell you one thing he's very concerned about is Tuesday. They really don't have everything locked in, which surprises me. Security is going to be a major problem -- how they're going to handle all that.

And there's some concerns about -- there's nothing, you know, definitively locked in with this, because you know why?

There is no one decision maker. And when you don't have a decision maker, you've got a problem.

So there will -- it's not going to be easygoing next week.

MALVEAUX: OK. Well, we look forward to so much more later -- later this evening in your special report.

Thank you, Larry.

KING: Thank you, dear. Good talking with you.

MALVEAUX: Thanks.

Well, as you can see, Neverland Ranch now stands barren and empty.

Let's go first to our, Abbi Tatton -- Abbi, Neverland used to be teeming with a lot of different folks and unusual artifacts and jewelry and furniture...

ABBI TATTON, CNN INTERNET REPORTER: That's why it's so amazing to see these pictures right now that are just completely empty. Because the pictures we've seen over the years are of rooms absolutely overflowing with art and collectibles -- an often eclectic collection.

We can go to the -- what was in the main living room of the main house that we were just looking at. There was not only a grand piano, but also a replica castle. Walk the rooms elsewhere, in the halls, you will see a guilded thrown, canopy beds, these very heavy, ornate pieces that really were just overflowing through these rooms.

And one of the other things we saw -- this was all from an exhibition earlier this year that displayed all of this collection. You saw how many life size statues Michael Jackson had that were lining the halls and greeting visitors; butlers -- we saw three or four butlers; chefs; a policeman all there, as well. And this extended outside, as well -- 2,800 acres of statutes, of games, the gate bearer of Neverland -- really, just so much stuff -- 2,000 items in this exhibition.

MALVEAUX: And, so, Abbi, where is all of this stuff now?

TATTON: Well, it was taken out sometime last year for an auction -- an auction that never went ahead. But it was put on exhibit back in April. Jillian's Auctions was the auction house and they say they gave it all back a few weeks ago, so...

MALVEAUX: OK.

TATTON: ...(INAUDIBLE) going back.

MALVEAUX: All right. Thanks. It's fascinating.

Thank you, Abbi.

A memorial service for Michael Jackson now set for Tuesday at the Staples Center in Los Angeles. Tens of thousands of people are expected to attend.

But with the city and state both in financial crisis, who is going to cover the costs?

Our CNN's Thelma Gutierrez is investigating -- and, Thelma, what are you finding out? THELMA GUTIERREZ, CNN CORRESPONDENT: Well, Suzanne, at the current moment, not many people are willing to go forth and exactly talk about how this will be dealt with. But I can tell you, the City of Los Angeles is facing a $530 million deficit. And the governor just said today that the state is in a fiscal state of emergency.

And so it's a fair question -- who will foot the bill for this memorial service?

(BEGIN VIDEOTAPE)

GUTIERREZ (voice-over): City officials expect it to be the biggest memorial service Los Angeles has ever seen -- an estimated 20,000 people inside Staples arena, hundreds of thousands of more outside.

How the area is secured and the massive crowd control will be up to Los Angeles police. It won't come cheap. Taxpayers will have to foot a big chunk of the bill for public safety.

JOSE HUIZAR, LOS ANGELES CITY COUNCIL: We are under some very difficult financial times.

GUTIERREZ: Los Angeles City Councilman Jose Huizar, who's on the Budget and Finance Committee, says the city is in a financial crisis, with a $530 million deficit.

HUIZAR: And people's lives are being affected. So, you know, we're saying we can't do any more this year -- this coming fiscal year.

GUTIERREZ: How much will it cost taxpayers?

No one is saying for sure. But during the Lakers championship parade, nearly 2,000 police were called in, at a cost of nearly $2 million. But the city was reimbursed for most of that by the Lakers and other private donors.

UNIDENTIFIED FEMALE: I think probably, given the state's financial situation, that doesn't seem to me to be the best use of funds.

UNIDENTIFIED MALE: I love Michael for what he's done. I don't mind. I'll dish out whatever money.

UNIDENTIFIED MALE: No. I don't think tax dollars should go for, you know, any kind of tribute for Michael Jackson or anything like that. If there's a way to fund it privately, then that's fine.

UNIDENTIFIED MALE: Oh, I wouldn't mind, because this is a once in a lifetime deal.

(END VIDEO TAPE)

GUTIERREZ: And you can see that many people here in Los Angeles have very different opinions how this should be dealt with. Now, the councilman says he's also a fan of Michael Jackson's and he's hoping that philanthropists, that people in the entertainment industry will come forward and help the city foot the bill, because the city is really going through hard times -- Suzanne.

MALVEAUX: Thank you, Thelma.

A second stimulus package?

Republicans are pouncing on President Obama over the first stimulus.

Who benefits from bad economic news?

(COMMERCIAL BREAK)

MALVEAUX: Republicans are hammering President Obama with some grim jobless numbers.

Joining us to talk about that and more, CNN senior political correspondent, Candy Crowley; CNN's senior Congressional correspondent, Dana Bash; and Mike Allen, chief White House correspondent for Politico.

Obviously, the economy was a big topic today -- some real bad numbers for the president. I want to first go to Republican response and criticism here. This from Eric Cantor. And he says: "Unemployment -- employment," rather, "must our focus, yet Speaker Pelosi and the unchecked Democratic majorities continue to increase Washington's hand in the free market, at the expense of job creation. At some point, even the speaker must realize that is" -- that enough, essentially, is enough."

I want to start off with you, Dana.

How much does this hurt the president, that you have so many people coming forward saying, you know, we're -- we're tired and we're running out of patience?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well, certainly, it would be more helpful to him politically if things were to turn around, particularly since, obviously, he came into office begging Democrats to pass this $787 billion stimulus bill. And people are waiting for that to actually take effect.

But, on the other hand, look, I talked to one Republican aide in Congress today who said, we just need to be careful to not just, you know, slam the president, but also come to the table with ideas.

And that is still the Republican problem, Suzanne. Republicans need to be much more forceful, much more out there with their own ideas, not just slamming Obama.

MALVEAUX: Mike, is it possible that they could get a second stimulus package or is that just completely dead in the water? MIKE ALLEN, CHIEF WHITE HOUSE CORRESPONDENT, POLITICO: No. I mean, they absolutely would consider that because not only does the president need numbers to move his direction, but, also, he has sold his two biggest programs -- energy and health care -- on the idea that they're going to help turn around the economy.

Now, it look likes he's going to get them -- or some version of them. And that means that he now has to deliver. And it's going to be tough because there's going to be tough months here. The staff says that in the next month or two, unemployment will hit 10 percent. They recognize that when it gets into double digits, that will break through with Americans in a way that this job hasn't before. We'll go back and look at 1983, the last time in double digits. And all that is going to put him off his message.

So he's going to be out there saying, no (INAUDIBLE) quick fix. This will take a while.

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: I think in terms -- I think you're seeing that already. And they're talking about lagging indicators, that, you know, the jobless number always falls behind in an economy that's already improving, which they insist it is -- the whole glimmers of hope thing.

The problem is everybody understands the unemployment rate.

BASH: Yes.

CROWLEY: It's not like the GDP in the second quarter and the this and the that. And that's where it hurts him.

But I think Republicans may be a little premature in the criticism. I think that the polls and the American people are not ready to begin to blame him for not producing...

(CROSSTALK)

MALVEAUX: Is there a timetable here, Dana?

What do you think?

But what -- what were you going to say?

BASH: Well, no. I mean I think there could be a timetable. But one thing -- I'll tell you a very funny conversation that I had with a top Democratic aide about this whole question about a second stimulus bill.

I got on the phone and he said, not going to happen, never get another -- we're never going to get another bill through the Senate, period, end of story. Next question.

(LAUGHTER)

BASH: I brought that quote because...

MALVEAUX: He was very adamant.

BASH: ...that is so funny -- very adamant because, look, I mean the timetable is -- is -- it what it is. I mean they're waiting. They're going to see -- see what turns around. They're going to hope that, just as Mike says, eventually, down the road, things like health care reform, things like energy reform, do make a difference.

But, you know, when it comes to doing more legislatively, particularly on the stimulus bill, no way. The votes are not there.

MALVEAUX: The president has been trying.

Does he need to change his message here, Mike?

ALLEN: Well, no. That's why he's trying to get out ahead of this. You saw him -- he went out and did an interview today, so he could talk about the fact that he's worried about the economy. We're going to see him out a lot. Next month is going to be Health Care Month and he's going to be interspersing that with conversations about the recovery.

He's trying to build the case that he acted to -- with lots of little appearances, put in people's minds that, yes, he has been out there doing things.

And, you know, the staff says that, in a way, it doesn't matter if they work. It's -- it's important that people know that he's out there doing it, because they can put out a chart to say that this was on his path long before he talks.

MALVEAUX: I have to leave it there.

Thank you so much for all three of you joining us here. We're running out of time.

ALLEN: (INAUDIBLE).

MALVEAUX: Jack Cafferty joins us again -- Jack.

CAFFERTY: What should be done in California's disastrous financial situation?

The deficit out there is north of $26 billion now. The legislature can't agree on much of anything. And -- and it's a mess.

Joe writes: "Mandate that any recipient of social services must be a taxpaying citizen or a legal immigrant."

Benjamin writes: "Time to hike up taxes. Other countries enjoy similar services that California provides, but without going broke. Why? Because they pay for them."

Abe says: "Well, seeing as California seems to be the testing ground for new national legislation, why not give marijuana taxes a trial run? What's the worst that could happen? They could put a small dent in the deficit. More likely, they could put a huge dent in it." Damon says: "I think the federal government should take notice. California has voted for extensive social welfare programs, but they vote down tax increases. They dug their own grave, just like Congress is doing for the whole country. It doesn't take a genius to figure out you can't spend more than you take in."

A.G. in South Carolina: "I don't live in California. This is one reason why. They made their bed, now they can sleep in it. It's not our problem. They need to learn a lesson and restructure the government. Hopefully, pain will snap them into reality."

Jim writes: "To start, stop electing movie stars to run the state."

Colleen in North Carolina: "Why doesn't Schwarzenegger do what my ex-boss did, fire everybody and then hire them back at 50 percent pay?"

John in San Diego writes: "We should do what the Feds have done -- print more money, write more checks and hope for change."

And Tom in Florida says: "I've been told all my life that California would fall into the Pacific Ocean. I guess they were right."

If you didn't see your e-mail here, you can go to my blog at CNN.com/caffertyfile and look for yours there -- and, Suzanne, have a terrific Fourth of July weekend. I'm off tomorrow and I'll be back on Monday.

MALVEAUX: All right. You, too, Jack.

Thank you so much.

CAFFERTY: Yes.

MALVEAUX: Instead of frisking suspects, these two officers were getting caught getting frisky in their squad car. The dash cam proves it.

(COMMERCIAL BREAK)

MALVEAUX: Police officers misbehaving and caught on camera. Here's Jeanne Moos.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN CORRESPONDENT (voice-over): We've seen lots of weird dash cam video -- from a grandma driving the wrong way on an expressway to a leaping deer.

(VIDEO CLIP)

MOOS: But oh my dear, check out the kanoodling (ph) cops. He was the 57-year-old chief of police. She is a 30-year-old officer in Perry Township, Ohio. Both are married -- but not to each other. (BEGIN VIDEO CLIP, COURTESY WKYC)

LARRY MERRILL, PERRY TOWNSHIP RESIDENT: For doing something like that? It's a mor -- he's a moron.

VIRGINIA KLOHA, PERRY TOWNSHIP RESIDENT: And if he wanted to mess around, why didn't he go someplace off-duty?

(END VIDEO CLIP)

MOOS: The pair were transporting a prisoner. Officer Janine England kept checking to make sure he was asleep in the back seat. When the video surfaced, Chief Tim Escola resigned and apologized. His attorney made no excuses.

CRAIG CONLEY, ESCOLA'S ATTORNEY: There's no way in hell I can say with a straight face that this conduct was acceptable. It's not acceptable.

MOOS: But at least the chief kept the car under control, unlike Charlie Sheen being chased by police in "The Chase."

(BEGIN VIDEO CLIP FROM "THE CHASE," COURTESY TWENTIETH CENTURY FOX)

CHARLIE SHEEN, ACTOR: What the hell is he swerving all over for?

(END VIDEO CLIP)

MOOS: "The Chase" almost makes the chief seem chaste.

(on camera): Now, there's usually a little red light on the dash cam that shows up when it's operational. Now, in this case, the red light wasn't on.

CONLEY: And apparently, that light had been tampered with.

MOOS (voice-over): The former chief's attorney believes another officer with an ax to grind turned in the chief after allegedly extorting him.

UNIDENTIFIED MALE: Resign right away and this tape will disappear.

MOOS: The part-time female officer wasn't disciplined, under the theory that her superior should have known better. Town trustees say he was a great police chief.

As for the kissy face.

CONLEY: There is no sexual conduct of which I can -- I'm getting kind of old to remember sexual conduct. But from what I remember of it, I don't see it on that tape.

MOOS: At least they didn't taser anyone. The only thing these two frisked was each other. CONLEY: When you get my age, sexual foreplay is five hours of begging.

MOOS: Jeanne Moos, CNN, New York.

(END VIDEO TAPE)

MALVEAUX: Up next, "LOU DOBBS TONIGHT."

Kitty Pilgrim is in for Lou -- Kitty.