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The Story Is with Elex Michaelson
Trump Slaps U.S. Tariff On Iran's Trading Partners; DOJ Investigation Of Fed Chair Powell Sparks Backlash; ICE, Protesters Clash During Operation In Minnesota; Hilton And Romero Launch GOP Ticket In California Governor's Race; Interview with California GOP Candidates Steve Hilton and Gloria Romero; Backlash Mounts Over Musk's Grok A.I.-Generated Sexual Images; Interview with L.A. Local CEO Michele Siqueiros; Paramount Files Lawsuit in Pursuit of Warner Bros. Discovery. Aired 1-2a ET
Aired January 13, 2026 - 01:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
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ELEX MICHAELSON, CNN ANCHOR: Steve Hilton and Gloria Romero trying to be the first Republicans to lead the Golden State more than 16 years. They're here live.
UNIDENTIFIED MALE: Live from Los Angeles, The Story Is with Elex Michaelson.
MICHAELSON: Welcome to The Story Is. I'm Elex Michelson live in Los Angeles. Tonight the top story is in Iran. The U.S. President Donald Trump sending new warnings over Tehran's brutal crackdown with on anti-government protesters.
President Trump says he will issue a 25 percent tariff on countries that do business with Iran. He also said he is considering some very strong military options if protesters are killed.
In response, Tehran is reiterating its threat to target U.S. military bases, ships and personnel in the Middle East if the U.S. launches strikes. U.S. lawmakers hope that the Trump administration will does not pursue military action.
(BEGIN VIDEO CLIP)
SEN. RAND PAUL (D-KY): I don't think it's the job of the American government to be involved with every freedom movement around the world and I do believe that bombing them may have the opposite. It's like how do you drop a bomb in the middle of a crowd or a protest and protect the people there? Bombing is not the answer. Plus, there is this sticking point of the constitution that we let president's bomb countries just when they feel like it.
(END VIDEO CLIP)
MICHAELSON: Now, despite the escalating warnings, Iran's Foreign Ministry spokesperson says that back channels of communication between the two countries remain open. Here's what the White House press secretary says.
(BEGIN VIDEO CLIP)
KAROLINE LEAVITT, WHITE HOUSE PRESS SECRETARY: Well, I think one thing President Trump is very good at is always keeping all of his options on the table. And airstrikes would be one of the many options that are on the table for the commander in chief.
Diplomacy is always the first option for the president. He told all of you last night that what you're hearing publicly from the Iranian regime is quite different from the messages the administration is receiving privately. I think the president has an interest in exploring those messages.
However, with that said, the president has shown he's unafraid to use military options if and when he deems necessary. And nobody knows that better than Iran.
(END VIDEO CLIP)
MICHAELSON: Now according to a U. S based human rights organization, at least 512 Iranian protesters, including nine kids, have been killed so far. CNN cannot independently verify these figures could actually be significantly higher. CNN's Jomana Karadsheh has the latest and a warning. Some images in her report are disturbing.
(BEGIN VIDEOTAPE)
JOMANA KARADSHEH, CNN CORRESPONDENT (voice-over): From behind the walls of the Iranian regime's censorship, a chilling video has emerged. Every movement of what may be a hidden camera reveals a terrifying picture of what's been unfolding on the ground. They butchered him this mourner wails, the camera drifts past grief not lingering long enough for us to be able to tell the stories of loss and pain of so many who gathered at the Kahrizak Forensic Medical Center outside Tehran, searching among rows and rows of body bags that line the courtyard for loved ones missing.
At the same facility, lines of lifeless bodies are stored in a warehouse turned morgue. Inside the center, distraught family members stand anxiously in front of a screen that flashes photos of the dead. They page the family of a man named Mohammed, who he and others were, how they were killed is hard for us to verify.
State media had its own pictures and narrative from the Kahrizak Forensic Institute reporting the majority of the bodies are those of ordinary citizens. They blame their deaths like the protest, on foreign backed terrorists carrying out what they say are indiscriminate killings. These pictures the regime decided to air, perhaps a warning to those who dare take to the streets.
It's almost impossible for us to get real time updates from Iran. The regime shut down communications across the country on Thursday, just as nationwide protests against the clerical establishment drew larger crowds to the streets of every province. It's a tactic out of its playbook on crushing dissent cover it's used in the past to unleash bloody force.
The little testimony and images that have been trickling out only a small window into what a ruthless regime doesn't want the world to see. Video like this that purportedly captures the feared state security forces out on the streets is slowly surfacing, sent out by those who are risking their lives to get it out.
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In this one location, an estimated 250 bodies with hundreds more confirmed killed elsewhere, according to activists. The world now braces for what may come when Iran finally emerges from the dark. Jomana Karadsheh, CNN, London.
(END VIDEOTAPE)
MICHAELSON: Joining me live on set is Benjamin Radd. He is a senior fellow at the UCLA Berkeley Burkle Center who studies these issues and himself Persian. Benjamin, welcome to the story is good to see you again.
BENJAMIN RADD, SENIOR FELLOW, UCLA BURKLE CENTER: Thank you.
MICHAELSON: I know you feel like these protesters can't really do this all on their own. They need some outside help. What do you mean by that?
RADD: Just looking at the images, the videos that you just played, it's difficult to see how they can sustain that type of pushback. I mean, the regime is deploying everything it has to kill, to maim, to terrorize, and that requires constant effort. And they can sustain that effort for a while.
At what point does the crowd decide, we've had enough death. We've had enough grieving. We need something to help shift the tide, to either weaken the regime or to cause the loyalists in the regime, the security apparatus, to defect to have second thoughts about doing what they're doing. We haven't hit that threshold yet, but who's to say when we will.
MICHAELSON: And every time since 1979, there have been these movements to have the regime taken down, but then the protesters simply run out of gas. I mean, that's what we've seen over and over again.
RADD: They do. But we should be mindful that even the '79 revolution, it took about 13, 14 months for it to happen. There are moments where it moves quickly and then there are weeks or months where nothing really happened and all it took was a mistake by the leadership or some action or something to reignite and spark and then finally be the final cross crack in the wall that brings the whole thing down. That could still happen, but it's difficult to pace these things.
MICHAELSON: And it's also been difficult to get information out of Iran because of this internet blackout. People have been struggling even to send text messages on their phones. The Starlink technology has worked, though, in some cases to be able to get information out. Starlink is basically Elon Musk's satellite that operate independent of everything going on in Iran. If you've got one of these boxes, you can beam up to his satellite technology. Really important in all this.
RADD: Yes. The regime's attempted to try to jam block those signals and has not been able to do so. The downside is it requires you to be near those units, have access to those units. Not everyone does, but it's played a huge role, especially for the young population, Gen Z, which makes up the majority, I should say those now who were born after the revolution make up well over the majority of the country.
They use social media not just to promote what they're doing to support each other during this time, but to learn about the west and the outside world and the liberties they enjoy and realizing the inequality and the difficulty that they live under. And it's not -- it's something that they no longer want.
MICHAELSON: What do you make of what you know, President Trump's role and his strategy?
RADD: Yes.
MICHAELSON: He's threatened that if you kill protesters, we're going to go after you. We know they've killed a lot of protesters and we literally see body bags on the ground of Iran. We hear it directly from people who have the Starlink were able to get out of there. What should the U.S. do now?
RADD: Well, President Trump is the statement he made about 24 hours ago indicating that negotiations were requested by the Iranians, that the United States is considering that they're sending someone to talk. But he said this last summer at the same time as he was planning military strikes against Iran during the so called 12-day war.
I wouldn't be surprised if the United States is undergone, planning and possibly beginning to implement something either covert or overt as a way to disrupt what the regime can do and to support those who are protesting.
MICHAELSON: That would obviously be a huge game changer. Meanwhile, we see Americans in the streets here this weekend here in Southern California, a whole lot of people protesting on this in like a sentence or two. What's their main message?
RADD: Well, their main message is for this regime to go. They are pushing for regime change. They're pushing for aggressive action by the United States, by the president, and they're hoping to see this happen sooner rather than later.
MICHAELSON: And these are some of the pictures from just this weekend here in Los Angeles. A tremendous outpouring that we saw of people that are trying to make that message be known. Benjamin Radd, thank you so much. Great to see you. Appreciate your perspective.
RADD: Thank you.
MICHAELSON: Tensions are high in Washington. As President Trump's own pick to run the Federal Reserve, Jerome Powell now being investigated by President Trump's own Justice Department. Officially, prosecutors are looking into whether Powell mismanaged a $2.5 billion renovation of the Fed headquarters and then lied about some of that to Congress.
Unofficially, this is seen by many as an escalation of tensions between the White House and the Fed that have been building for months. President has been critical of Powell because he hasn't lowered interest rates to Trump's liking.
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(BEGIN VIDEO CLIP)
LEAVITT: The president has every right to criticize the Fed chair. He is a First Amendment right, just like all of you do. And one thing for sure, the president's made it quite clear, is Jerome Powell is bad at his job. As for whether or not Jerome Powell is a criminal, that's answer the Department of Justice is going to have to find out. And it looks like they intend to find that out.
(END VIDEO CLIP)
MICHAELSON: Every living former Fed chair says this investigation threatens the central bank's independence. In a joint statement, Janet Yellen, Ben Bernanke, and Alan Greenspan, who worked for Democratic and Republican presidents, all called the probe an unprecedented attack on the Fed's autonomy.
Powell himself echoed those claims in a video unlike we've ever seen from a Fed chair before, released on Sunday.
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JEROME POWELL, U.S. FEDERAL RESERVE CHAIR: This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings. Those are pretexts. The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public rather than following the preferences of the President.
(END VIDEO CLIP)
MICHAELSON: Now, some Republican lawmakers tell CNN's Manu Raju they want the investigation to wrap up fast.
(BEGIN VIDEO CLIP)
MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Do you think the White House is trying to stop the independence of the Fed?
SEN. THOM TILLIS (R-NC): Somebody at DOJ, I mean, the President said he wasn't in the mix. Another example of amateur hours for as I'm concerned.
RAJU: Should they drop the investigation?
TILLIS: I'm not going to get into that. What I'm going to do is drop any consideration for any board confirmation until it's done.
RAJU: Are you concerned about --
SEN. STEVE DAINES (R-MT): Well, I support the independence of the, of the Feds, and I hope that this investigation wraps up very, very quickly.
RAJU: And what's the impact of it? It isn't wrapped up.
DAINES: It will wrap up quickly It needs to.
RICHARD QUEST, CNN ANCHOR: Had presidents come out and say lower interest rates, lower interest rates. But this next move to actually have an investigation. And remember, Elex, this is not an investigation into the overruns and the over costs of the Fed building, which are considerable, which might be legitimate.
This is an investigation into Jay Powell's testimony. Did he perjure himself? So this nonsense idea that somehow taxpayers money, we need to make sure that there was no overruns. No, the investigation is into Jay Powell and that makes it personal. And that's why Powell said it's a pretext.
MICHAELSON: Well, and a lot of folks, certainly on the left and even some folks on the right think that this whole thing is politically driven. Is there a possibility, though, that Jay Powell may have actually perjured himself in this Congressional testimony. Does he have any reason to worry?
QUEST: The perjury involved, by the way, is what was going to be involved in the Fed building, for instance, the marble, the dining rooms, the elevators, all those sort of things. And by the way, there has been numerous subsequent testimonies, clarifying, correcting evidence, amplifying on and on about this project and how it's a massively old building, requires vast reconstruction.
But to your point, is it possible? Absolutely. Totally. Of course. But can I think of a person more unlikely to perjure himself this than Jay Powell, who has been with the Fed years, who is a man of probity, whose integrity, who has not risen to the bait? People are laughing. I cannot think of somebody that you would put that.
Now, does it mean he couldn't have done it? Let's be clear, let's be honest, let's be fair. Of course he could have done it. Is it likely? No.
(END VIDEO CLIP)
MICHAELSON: Part of my conversation with Richard Quest during the last hour here on CNN are thanks to Richard. The White House is still defending its immigration crackdown despite some protests condemning ICE over the weekend.
(BEGIN VIDEO CLIP)
LEAVITT: ICE is doing an incredibly important job that's not just important to our homeland security, but our national security. And this administration will continue to stand wholeheartedly by the brave men and women of ICE, including that officer in Minneapolis who was absolutely justified in using self-defense against a lunatic who was part of a group, an organized group, to interject and to impede on law enforcement operations.
(END VIDEO CLIP)
MICHAELSON: Sources tell CNN about 1,000 more immigration officers are heading to Minneapolis as clashes with protesters in that city ramp up. This comes as Minnesota is now suing the Trump administration and seeking a court order to stop immigration operations in the state. Sherrill Hubbard has our story.
(BEGIN VIDEOTAPE)
SHERRILL HUBBARD, CNN CORRESPONDENT (voice-over): The Department of Homeland Security has responded to a lawsuit filed Monday accusing Minnesota politicians of not doing their jobs.
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That's after the state of Minnesota in the Twin Cities, Minneapolis and St. Paul sued the Trump administration to put a stop to its immigration crackdown.
KEITH ELLISON, MINNESOTA ATTORNEY GENERAL: The deployment of thousands of armed mass DHS agents to Minnesota has done our state serious harm.
HUBBARD (voice-over): Federal agents dispersed a group of protesters after a fight within the crowd on Sunday night. Or an ICE agent pushing a man who was blocking an ICE vehicle to the ground said Saturday. All this after unrest over ICE agent Jonathan Ross shooting and killing protester Renee Good last Wednesday.
One resident visited the site of Good's killing, adding to the growing memorial where she died as she tried to drive away from an ICE agent last week.
UNIDENTIFIED FEMALE: It's been heartbreaking, horrifying. I cannot believe this is happening in our community.
HUBBARD (voice-over): Residents and local government alike expressing grave concern for an immigration crackdown that's only set to grow around a thousand additional U.S. Customs and Border Patrol agents are expected to deploy to Minnesota.
UNIDENTIFIED FEMALE: Minneapolis used to be known as an open city, as a loving city, and now it is invaded.
ELLISON: In essence, a federal invasion of the Twin Cities and Minnesota. And it must stop.
HUBBARD (voice-over): City leaders say they are committed to keeping the pressure on. JACOB FREY, MINNAPOLIS, MINNESOTA MAYOR: As long as federal agents are
in our city acting unconstitutionally against our neighbors, we will continue to push back with everything we got.
HUBBARD: I'm Sherrill Hubbard reporting.
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MICHAELSON: Minnesota state officials are accusing the federal government of violating the 10th Amendment and targeting the Twin Cities due to its sanctuary polys. CNN's Elie Honig, a former federal prosecutor, explains what we're talking about.
(BEGIN VIDEO CLIP)
ELIE HONIG, CNN SENIOR LEGAL ANALYST: It's filed in federal court and it's asking this federal judge to do a couple things. First of all, to declare ICE's presence in Minneapolis unconstitutional and unlawful. And then also there's a whole list of demands about the way that ICE goes about its policing. Essentially, the state is asking the federal court to oversee and manage and limit some of the tactics that ICE has been using.
If you look at this complaint, essentially it lists out the recent history of this surge of ICE agents into Minneapolis and it does mention prominently the recent fatal shooting of Renee Good. That's a key component of this lawsuit.
(END VIDEO CLIP)
MICHAELSON: Elie Honig speaking to Kasie Hunt earlier. Coming up, Grok, Elon Musk's AI is facing some backlash around the world by several countries are now banning the artificial intelligence tool.
Plus, Republican running mates Steve Hilton and Gloria Romero standing by live. They plan to win the governor and lieutenant governor's races in deep blue California. And why, Gloria, former Democrat now running as a Republican. You see that Republican Red, Stay with us.
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GLORIA ROMERO, FORMER CALIFORNIA STATE SENATOR: I was the Majority leader of the California Senate, the first woman elected to this historic office. And yes, I was a Democrat. But after seeing years of Democrat one party rule in Sacramento and its failed outcomes for everyday people, I left the party. I walked away.
(END VIDEO CLIP)
MICHAELSON: That is Gloria Romero announcing that she's running for Lieutenant Governor of California as a Republican and she's joining a ticket with Steve Hilton who is also running as a Republican for Governor of California. The two of them here with us live right now on the story is Gloria Romero, Steve Hilton, welcome to the show and congrats on the run.
STEVE HILTON, REPUBLICAN CANDIDATE FOR CALIFORNIA GOVERNOR: Great to be with you. Thank you.
MICHAELSON: We've talked to you about your run before. So let's start with you, Gloria, to talk to you about your run. You been the majority leader for the Democrats. You're the first woman to ever be in that job in California, a trailblazer for the Democratic Party. You worked as a co-chair on the Obama campaign. Why are you doing this?
ROMERO: Well, I think the transition has been coming for quite some time. Even though I was termed out of Sacramento. It's been some time. Back then, people knew me as somebody who would work across the aisle.
But I also was able to do that because I understood that when you don't have one party rule, you do have to strike the compromise. And at that time, we had a Republican governor, legislative chambers dominated by Democrats, but for me, comfortable working with various political parties. It meant you've got to get something that works for everybody. So it's been a long time coming.
Finally, though, I decided, especially after the political coup, when Joe Biden was thrown out and suddenly we magically had an appointment of another candidate to take his place. I said, that's a bridge too far. And I finally called Steve, my dear friend, whom we had worked together on a number of issues, and said, I'm out. This is the last straw for me.
MICHAELSONL And now you're running for lieutenant governor. We don't have tickets in California. So it's not like on some states it says governor and lieutenant governor in one space. These are independent offices. Traditionally, people do not run for them together in this state. Why are you guys deciding to do this as a package deal?
HILTON: It is a first, Elex. And look, I've always said we talked about this before. I think it's time for change in California. A majority of Californians agree with that, over 60 percent. But it's not going to be easy to win as a Republican in this state. It's been a long time since a Republican won statewide.
And so I've always said we've got to do it differently. And I've always believed in the idea of a team that's going to turn things around in California.
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And I'm running as an outsider, a business owner, worked in the government back in the UK. Now this is my home. I'm a proud American and a proud Californian. So I'm going there to take on the failure and corruption in Sacramento.
But right by my side, Gloria is going to be helping me with all her years of experience in the state Capitol, in the legislature, understanding how it works or more often these days doesn't work with, going to be a really strong team. What we call the golden ticket.
MICHAELSON: Yes, well, let's talk about the math because you mentioned it's been a while. No Republican has won this state since Arnold Schwarzenegger won it in 2006.
HILTON: Yes.
MICHAELSON: He was one of the most famous people on the planet and he was married to a Kennedy Democrat at the time. Since then, we haven't been any Republicans that have won. There are twice as many Democrats as there are Republicans in this state. Newsom in every statewide race has won by about 20 points. Schiff won by about 20 points.
How do you find that 20 percent? Where did they come from to say all of a sudden I'm going to vote for a Democrat or vote for a Republican at a time when our politics has even gotten more partisan?
HILTON: Well, I'll start with the number that I just touched on, which is regularly in polls in California now. 60 percent, sometimes even higher, 65 percent say the state is going in the wrong direction.
MICHAELSON: Yes.
HILTON: And after, you know, just look at everything. We have the highest cost for everything that matters.
MICHAELSON: They've said that for a while and they haven't voted for.
HILTON: But it's getting worse, it's getting tougher, especially for regular working class Californians. And I think it's been a long time since they've had in front of them the opportunity to vote for a ticket and to vote for a vision for California that is very practical, very positive, not ideological. It's $3 gas, cut your electric bills in half, your first hundred grand free of state income tax, a home you can afford to buy. Positive, practical things that don't divide people along ideological lines just say, look, we can get in there with common sense ideas to just make your life less of a struggle in California. That's the appeal, I think, of what we are putting out there.
MICHAELSON: Gloria, you know the legislature, you know that it's dominated by a Democratic super majority in both the assembly and the Senate. You've served in both of those chambers before. How do you get something done as a Republican governor and lieutenant governor given those numbers? And what do you think could actually pass in a bipartisan way.
ROMERO: Remember when I left Sacramento, there was not one party rule. One party rule has been the consequence of years of basically just people voting the same way over and over and expecting a different result, which we'll never get.
So let me go back to this idea about the golden ticket. Yes, we run independently, but the governor and the lieutenant governor should work together. Right now, what you see are basically statewide constitutional officers who really don't work with each other, who don't collaborate.
The lieutenant governor, it's interesting. I call it the Seinfeld of basically our statewide offices because nobody knows who the lieutenant governor is and what they even do.
MICHAELSON: You mean it's a job about nothing? Is that what you're trying to say?
ROMERO: Well, it's a job that nobody knows.
MICHAELSON: OK.
ROMERO: There's the joke saying you just basically check to see, is the governor alive?
MICHAELSON: Yes.
ROMERO: Steve will be alive. He's very healthy. But I think there's so --
MICHAELSON: Jerry Brown and Gavin Newsom, when Gavin News was lieutenant governor famously, they didn't talk to each other for years.
ROMERO: Right. Right.
MICHAELSON: Like didn't even speak to each other.
HILTON: Used to say it's the worst job. You don't get to do anything. It's going to be very different. But Gloria, what -- the thing we first worked on as a team with my policy organization, Golden Together, was education policy. That's where Gloria really led so strongly in the state legislature.
Now the teacher unions didn't like it because she was there for parents school choice and so --
ROMERO: Merit paid school choice.
HILTON: You look at the UC system, you're going to have an important role there. And so that's going to be a really good complement to my focus on the core economic issues. So this really is a partnership. We've already been working together for three years.
And so I persuaded Gloria to take that next step and actually run with me. I'm really excited about not just the campaign and our chances in this election. I'm not saying it's going to be easy. I know we can do this and California needs it. We desperately need change in this.
MICHAELSON: Yes. And the lieutenant governor has a seat both on the UC board and also the CSU board as well, some of the most important --
ROMERO: And the Board of Governors as well for --
MICHAELSON: Yes.
ROMERO: -- the community colleges. I'm a product of all three.
MICHAELSON: Yes.
ROMERO: And the part that I really like as well too is that the lieutenant governor should be the leading voice on education policy. We have a crisis in public education. Gavin Newsom wants to throw more money into K through 12. Right now less than half of our students are even proficient at the basic levels when it comes to reading and to mathematics.
But we can do the math. We must do the math. We want to do things differently. The last election showed that the voters are willing to walk away, and that's what I signify.
MICHAELSON: Yes.
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ROMERO: I walked away, not away from my principles, not away from my values, but away from the domination of one-party rule that has really screwed over working-class, middle-class families.
HILTON: Exactly.
MICHAELSON: There is something that it seems like you agree with Governor Newsom on, which is this wealth tax, which is being thought of right now in California.
Ro Khanna, the Congressman, supports this idea of a tax on the very wealthy. Governor Newsom has been against this for many years --
HILTON: Yes.
MICHAELSON: -- giving an interview tonight to "The New York Times", to Politico, saying it's a really bad idea. I'm going to do everything within my power to stop it, trying to stop it.
Do you think Governor Newsom is right when it comes to that?
HILTON: He's right on this. I absolutely agree with him. I'm glad he's fighting it. I hope he can persuade the unions to not go ahead with it.
But the terrible thing Elex is, it's already having a damaging effect, just the threat of it. You've seen a bunch of billionaires, whatever you think of them, remember that half the income tax in California, the revenue is paid already by the top 1 percent.
We have already lost just in the last few weeks, billions of dollars in revenue because billionaires have already moved out of California.
Regardless of whether this is on the ballot or not, it's already damaging the revenue that we need to pay for essential services.
MICHAELSON: Yes. And just to reiterate that point, more than half of the revenue in California comes from just 1 percent of people. HILTON: Exactly.
ROMERO: Right.
MICHAELSON: And the -- and depending on how, frankly, rich people are doing --
HILTON: Yes.
MICHAELSON: -- you're either going to have massive surpluses or massive deficits --
HILTON: Exactly.
MICHAELSON: -- every year. And maybe that could use a little reform too.
But you got a lot of work to do.
HILTON: You can say that again. We're excited about it.
MICHAELSON: Yes. Steve Hilton, Gloria Romero -- great to see both of you. Thanks so much for coming in.
HILTON: Thank you, Elex.
ROMERO: And if I can say forget the Powerball, the Mega Millions -- the Golden Ticket is good for California.
MICHAELSON: There you go. And if you give us all a couple billion dollars, I think we'll all be happy.
HILTON: Yes.
MICHAELSON: Thank you very much.
We'll be right back. More of THE STORY IS after this.
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MICHAELSON: Grok explain this. The A.I. tool embedded in Elon Musk's X app is once again drawing controversy. This time for generating illicit images on demand, including sexually explicit content involving minors.
In a world first Grok has been blocked by Indonesia and Malaysia as international pressure mounts against Musk.
CNN's Hadas Gold looks into the latest allegations against the so- called "everything" app.
(BEGIN VIDEOTAPE)
HADAS GOLD, CNN CORRESPONDENT: Elon Musk, defiantly defending his A.I. chatbot Grok's ability to digitally undress images of real people as countries around the world take action against the A.I. tool after Grok's X account was flooded with requests to create deepfake, non- consensual, nearly nude images of adults, and in some cases, children.
KEIR STARMER, BRITISH PRIME MINISTER: This is wrong. It's unlawful. We're not going to tolerate it. I've asked for all options to be on the table. It's disgusting.
GOLD: X has said it is taking action against those who prompted Grok to create sexually exploitative images of children, and has since restricted image generation requests on Grok's X account to paid subscribers, though users can still digitally undress images by chatting with Grok directly.
Meanwhile, Elon Musk repeatedly attacked U.K. Prime Minister Keir Starmer on X and reposted A.I.-generated images of him in a bikini. "They want any excuse for censorship," Musk wrote and reposted a claim that no similar action is being taken against other A.I. companies, though no other major A.I. model is woven into a social media platform like Grok is with X.
Musk's A.I. company is also facing challenges in Asia, where Indonesia and Malaysia are enacting temporary bans on the A.I. chatbot. Indonesia's digital minister saying over the weekend that the ban is meant to protect women, children and the broader public from the risks of fake pornographic content generated using artificial intelligence technology.
Meanwhile, the United Kingdom's communications regulator Ofcom announced on Monday it is launching a formal investigation into X that could lead to fines or even blocking the platform in the country.
LIZ KENDALL, U.K. TECHNOLOGY SECRETARY: The government is crystal clear. We want those images taken down. They are despicable. They are abhorrent.
GOLD: In the United States, the Departments of Justice and Homeland Security have said they will prosecute any producer or possessor of sexually explicit material of children.
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Ok, there we have it.
GOLD: Last year, President Trump signed the Take It Down Act, which makes it a crime to publish non-consensual, intimate deepfakes and will soon force platforms to remove such images within 48 hours of notice.
Now, experts on A.I. and the law say more needs to be done so A.I. companies can rigorously test their models and prevent them from producing such content in the first place.
RIANNA PFEFFERKORN, POLICY FELLOW, STANFORD INSTITUTE FOR HUMAN- CENTERED A.I.: The laws don't have any exceptions for good faith testing or research type purposes. And so we found that there was a real fear of these laws that was impeding what are called red teamers, people who are trying to act as a malicious actor would, and test the model to see if it can be misused from doing that kind of work in the context of child sex abuse imagery.
GOLD: Hadas Gold, CNN -- New York.
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MICHAELSON: Much has been said about the so-called death of local news, but a local news outlet here in L.A. is bucking the trend by expanding. It's a brand-new model for nonprofit news that could be replicated around the world. We'll explain how it works. Their big announcement, next.
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MICHAELSON: Here at CNN, we often cover geopolitics and our audience is the world. The show's on in 200 countries.
But right now were going to take a closer look at the importance of local news. As local newsrooms across the country struggle to stay alive, a nonprofit called the L.A. Local is expanding and will soon cover another ten neighborhoods in the metro area of the U.S.' second biggest city. That's thanks to a major philanthropic effort and investment.
with me here in Los Angeles is Michele Siqueiros, the founding CEO of the L.A. Local. Pronounce your last name for me.
MICHELE SIQUEIROS, FOUNDING CEO, L.A. LOCAL: Siqueiros.
MICHAELSON: Siqueiros. Great to have you. Congratulations on the expansion.
SIQUEIROS: Thank you.
MICHAELSON: What is the L.A. Local?
SIQUEIROS: The L.A. Local is a new community independent, nonprofit newsroom dedicated to serving the people of L.A. We are committed to building trust, to doing news, not just for the community, but with the community. Doing a lot of listening and making sure that we're lifting up the stories that people in Los Angeles need to know about, want to know about, to really affect change.
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MICHAELSON: So, as we know, traditionally the model has been for- profit news, and we've had all these papers across the country. Here in Los Angeles, it's "The L.A. Times". There's so many other papers around the country that have either dramatically shrunk their staffs, like "The L.A. Times" has, or in so many other parts of the country just gone away entirely, the areas that are called news deserts, where there aren't people reporting.
That was the for-profit model, which has kind of fallen apart as classified ads have gone away. How does the nonprofit model work? How do -- how do you -- how do you stay afloat with that?
SIQUEIROS: Well, in Los Angeles, we've Had a huge philanthropic investment by community leaders that really did a lot of listening.
So we have civic leaders that care about local news and information, about making sure that people can get access to trusted facts, sourced news. And they've made a commitment.
We've raised over $90 million to support the L.A. Local. And we're also going to continue to really build on that to ensure that we're providing a real service to community.
MICHAELSON: And a big part of what you're doing also is collaborating with other organizations to get stories out. How so?
SIQUEIROS: Well, we're investing in reporters at L.A., the local NPR affiliate at CalMatters, which covers statewide policy news, and smaller publications across the Los Angeles region.
And the idea, Elex, is really to say, you know, we're stronger together if there's information that's important to somebody in Los Angeles, then it doesn't matter how they get it, whether they get it from CNN or they get it from the L.A. Local.
What we want to make sure is that people get access to information that they need, that is useful for their lives, and that gives them a sense of connection to their neighbors.
MICHAELSON: What's the kind of story that maybe makes it in a nonprofit paper, but doesn't make it in a for-profit paper?
SIQUEIROS: Well, I mean, I think a lot of stories would be covered by both. But for example, last year has been an incredibly difficult year for Los Angeles.
We've had wildfires. We've had immigration enforcement. We've had the economic impact of immigration enforcement across our region and affordability is still a huge issue.
Those are issues that I think would make it in any news, but maybe locally we get to talk to neighbors and we see the impact much sooner because we're talking to community.
We do a lot of listening. We walk the community, we do pop ups to hear what are the things that are really affecting and interesting to our neighbors.
MICHAELSON: And local news is just so important. You think about L.A. County alone. There's 87 cities in L.A. County, on top of the four other counties just in this region.
So all of those have their own mayors, their own city councils. And oftentimes nobody's covering these cities. So all of this corruption happens, and many times because nobody's minding the shop, nobody's keeping these people accountable. And across the country, we're seeing this in these news deserts where people are able to get away with stuff. That's why sometimes local news is so important. Just showing up at the school board meeting can be so important.
SIQUEIROS: Just showing up. And we have professional reporters showing up. We have youth journalists that we're training through our youth high school internship program, and we have L.A. documenters. These are residents like regular folks, everyday folks that are paid, they're trained to go to public meetings and take notes and to publish those notes on our Web site.
So you can actually find out what did the LA police commission talk about? What is the Inglewood City council doing today? That's important. We deserve to know.
MICHAELSON: It is. And we've seen in places like Bell and Vernon and other places, when there aren't people there, oftentimes people end up literally becoming criminals because they think they can get away with it.
Michele, congratulations. People can check out the L.A. Local right now as it launches. Thank you so much.
SIQUEIROS: Thank you.
MICHAELSON: Coming up, Paramount taking its pursuit of Warner Brothers Discovery, our parent company, to court. The latest on that takeover bid and WBD's reaction to the moves as we look at a live picture from right outside our window at the Warner Brothers lot.
Stay with us.
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MICHAELSON: Paramount is ramping up its push to purchase CNN's parent company, Warner Brothers Discovery. The latest moves include a lawsuit as Paramount attempts a hostile takeover of the entertainment company.
CNN's chief media analyst Brian Stelter has the details.
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BRIAN STELTER, CNN CHIEF MEDIA ANALYST: Hey there.
Yes, Paramount's checking all the boxes, taking the next steps in its months' long pursuit of Warner Brothers Discovery, CNN's parent company.
On Monday, Paramount filed a lawsuit in Delaware, a frequent venue for corporate disputes, and foreshadowed a proxy fight over control of the WBD board.
Right now, Paramount's mounting a hostile takeover bid for all of WBD, including CNN and other channels. Meantime, there's already a deal on the table between WBD and Netflix to take control of the HBO streaming library, the HBO Max streaming service and the Warner Brothers movie studio.
Netflix says that deal is moving forward. WBD says the same thing. But Paramount is trying several different ways to take control of WBD.
The number one plan right now is what's known as a tender offer, where Paramount is trying to buy up shareholders shares of WBD for $30 per share.
In this lawsuit filed on Monday, Paramount is seeking more information about how WBD valued the assets, including CNN and other channels, before going ahead and agreeing to the deal with Netflix and rebuffing Paramount's competing offer.
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STELTER: Here's part of what Ellison wrote in his letter to shareholders, quote, "We are surprised by the lack of transparency on WBD's part regarding basic financial matters. It just doesn't add up," Ellison said. "Much like the math on how WBD continues to favor taking less than our $30 per share all-cash offer for its shareholders."
Indeed, Netflix's offer for HBO and Warner Brothers is closer to $28 a share, a little bit less. However, the idea from WBD's board is that CNN and other cable channels are going to be part of a new publicly traded company called Discovery Global that has considerable value. And if you add it all up together, then that makes the Netflix deal superior.
That's what we've been hearing from the WBD board again in a statement on Monday. Here's what the company said on Monday afternoon. Quote, "Despite six weeks and just as many press releases from Paramount Skydance, it has yet to raise the price or address the numerous and obvious deficiencies of its offer. Instead, Paramount is seeking to distract with a meritless lawsuit and attacks on a board that has delivered an unprecedented amount of shareholder value."
Major WBD shareholders have been split over Paramount, with some siding with the Netflix deal that's already on the table and signed, and with others suggesting that Paramount bid is superior.
So this corporate tug of war is going to continue probably for months to come.
Brian Stelter, CNN.
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MICHAELSON: In the meantime, we'll keep doing our jobs and put our head down.
The International Space Station has a new commander.
(BEGIN VIDEO CLIP) UNIDENTIFIED MALE: This has been passed on for a long time. It's the key to the ISS. So Sergey --
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MICHAELSON: NASA held a change-of-command ceremony Monday on board the ISS. The agency is bringing SpaceX crew back to earth earlier than planned due to medical concerns for a crew member.
Our thanks to you for watching THE STORY IS. I'm Elex Michaelson.
We'll see you tomorrow with more.
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