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CNN NEWSROOM

Postal Service, No Mail on Saturdays; Panetta Speaks on Defense Cuts; Jodi Arias on Trial Today; Musician Advocates for Multiple Sclerosis Research

Aired February 6, 2013 - 11:00   ET

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


(COMMERCIAL BREAK)

ASHLEIGH BANFIELD, ANCHOR, "CNN NEWSROOM": Hello everyone I'm Ashleigh Banfield. I want to get you started with quick headlines right out of the gate.

Home mail delivery on Saturday, about to be a thing of the past. The Postal Service just announced it's going to stop weekend delivery of letters and other first class mail starting August 1st.

You will still get your packages, though. But the cash strapped post office says this move is going to save them billions of dollars.

Defense Secretary Leon Panetta is dropping a bombshell on active duty troops and their families. We have exclusive information he will ask today for their pay raises to be cut from 1.7 percent to just 1 percent.

Obviously, this looks a lot like a shot across the bow over those possible automatic defense spending cuts that are in the works.

And, in fact, Secretary Panetta minced no words in speaking at Georgetown a short while ago. He says the upcoming automatic defense spending cuts threaten, quote, "the most serious readiness crisis faced by the military in more than a decade."

(BEGIN VIDEO CLIP)

LEON PANETTA, DEFENSE SECRETARY: For more than a year and a half, the joint chiefs of staff and I have been extremely vocal about our deep concerns about taking another half trillion dollars out of the defense budget in an across-the-board fashion that hits every area, and that guarantees that we hollow out the military, across the board cuts, that would deeply damage our national security.

(END VIDEO CLIP)

BANFIELD: The secretary urged Congress to accept President Obama's call yesterday for smaller package of cuts to avoid the across-the- board reductions known as sequestration. You've probably heard a lot about that.

That sequestration would reduce defense spending by $45 billion through September. The national board of the Boy Scouts of America has decided to put off an important vote to decide on lifting or not lifting a ban on gays until May.

The vote was expected to come today, but moments ago, the board said it need more time for a more deliberate review of the membership policy due to quote, "the complexity of the issue."

If the national ban is eliminated, it could be left up to the local Scout units to decide if they will accept gay leaders and scouts or if they will not.

In the South Pacific, a powerful magnitude 8.0 earthquake struck off the Solomon Islands today and that triggered a tsunami.

Five people were killed when a three foot high wave hit the Santa Cruz Islands, part of the Solomon chain.

The tsunami warning for several countries has now luckily been canceled.

In Egypt, a rude welcome for Iranian President Mahmoud Ahmadinejad. Take a look at the pictures. It might look good when he was mobbed by a crowd of supporters in Cairo, but suddenly a man -- right there -- threw a shoe at him.

It was captured on a news agency video. The aim was off. The officials say the shoe did hit a security guard, and the shoe is a huge sign of disrespect in those parts of the world.

There is a price to be paid for coming clean after years of playing dirty, and for Lance Armstrong, that price could just be starting at $12 million.

CNN can now confirm that the sports insurance company that paid Armstrong an eight-figure bonus for winning the Tour de France in 2002 and 2003 and 2004, well, that company has had it. And they are going to file a lawsuit.

They've made the decision, and it's going to be filed as early as today to get the money back from Armstrong.

Jeffrey Tillotson represents SCA Promotions. He joins me live from Dallas. He is the attorney who will likely be headed to the courthouse to file that paperwork.

Mr. Tillotson, this has been talked about for a long time. There was something like an ultimatum that I believe you gave to Mr. Armstrong saying, pay up or else. Is this the or else?

JEFFREY TILLOTSON, ATTORNEY, SCA PROMOTIONS: That's correct, Ashleigh. We've made our demand for the return of the money we paid him for winning the Tour de France races where the titles were stripped.

Mr. Armstrong and his legal team have not complied with that demand and have publicly said he's not going return prize money.

So, we're left with little choice but to institute legal proceedings, which my client plans on doing.

BANFIELD: And let's be clear, so that the viewers understand what's at stake here.

This was Lance Armstrong who sued you for the money when you dared to question whether you should be paying these bonuses, given all of the rumors about the drugs.

And you guys had to come to a settlement on this. Didn't you? And you paid him in that settlement.

TILLOTSON: That's correct. I mean, he was the official winner of those races, and our contract required that we pay him if he was the official winner.

But both he and his lawyers almost taunted us and said, if we are ever stripped of those titles, we'll give you the money back.

I think at that time, Mr. Armstrong thought he would never be caught. Of course, he has been caught, exposed, confessed, admitted essentially to perjury.

And, so, we're simply going to ask him to finally live up to his word and give that money back.

BANFIELD: Not to suggest you can from memory quote everything that is in your paperwork, but have you got the price tag listed in your suit?

TILLOTSON: Yes. We've paid him a little more than $12 million in prize money for winning three different Tour de France races. We'll seek repayment of that $12 million plus our costs in legal fees.

My client spent an inordinate amount of legal fees and investigatory fees to develop the evidence that was later turned over to USADA.

BANFIELD: How much?

TILLOTSON: In excess of seven figures. I mean, the amount ...

BANFIELD: So, what's the total that you're looking for from Mr. Armstrong?

TILLOTSON: Between $13 million and $14 million.

BANFIELD: And that includes the interest after all of these years of waiting this out?

TILLOTSON: Yes. The total sum from Mr. Armstrong is going to approach, depending on when the lawsuit is ultimately resolved, close to $15 million.

BANFIELD: So that's essentially the headline here today, is that you are going after him. You are doing it possibly today, at the latest tomorrow. And the price tag for Lance Armstrong could be upwards of $15 million.

TILLOTSON: I think that's right. We've made that demand. And lawsuits are about making people do things that they won't otherwise do. He's got to comply with the law and give that money back.

BANFIELD: I want to bring in Jeff Toobin. Don't go away, Mr. Tillotson, if you could stay for just a moment.

Jeff Toobin is our senior legal analyst. This is fascinating. Because I mean you have been in probably a lot of settlement rooms where you have to sign off, this thing is closed for good. I'm never going back. I can't go back. Here's your money. I never want to see you again.

That was sort of the essence of this settlement, too. How can you now revisit it?

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Well, if it was procured by fraud, if the argument is here that Armstrong procured this settlement by engaging in fraud, fraudulent conduct, specifically lying about whether he used these drugs, a court could reopen the settlement.

But it's by no means certain that Mr. Tillotson will win the lawsuit even though Lance Armstrong is a very unsympathetic defendant.

BANFIELD: Jeff Toobin -- Lance Armstrong's lawyer has said this, and I'm going to have to quote it because he doesn't give a lot of interviews these days, and there aren't a lot of quotes that we can actually read from, but I can say this.

"No athlete has ever gone back and paid back his compensation. Some were suspended, but nobody said you've got to give your paycheck back."

Is that correct? And who cares, if no one ever has before, doesn't mean it can't be done.

TOOBIN: It doesn't mean it can't be done, but the argument is the settlement was made with the understanding -- Armstrong's argument will be the settlement was made with the understanding is that circumstances may change in the future.

The world is going to keep spinning. There's going to be more news, but you are signing away your right to file this case, and this settlement is the end of the case.

BANFIELD: Mr. Tillotson, just quickly, the amounts that you've quoted me look like you're just trying to get what is yours after what Jeff Toobin described as a fraudulent payout. The winnings weren't clean.

Is there not an aspect of punishment that you want to inflict on Mr. Armstrong after dragging your group through the mud and accusing you of not doing the right thing by paying him and daring to question his cleanliness?

Is there not something else you want, some punitive damage there? TILLOTSON: It's tempting, but it was Mr. Armstrong and his lawyers that had the vendetta, that went out and tried to punish people.

My client isn't interested in punishing anyone. It's interested in getting back money it improperly paid Mr. Armstrong.

That said, one difference between what Mr. Toobin says and what happened with us is Mr. Armstrong committed what I would call relentless perjury in our legal proceeding.

He didn't just lie about performance enhancing drugs. He lied about virtually everything. And we are going to ask the arbitration panel that heard that perjured testimony to punish him and hold him accountable for it.

It's pretty astonishing what he said and did.

TOOBIN: No, I mean, there's no doubt that he lied in those depositions. He's acknowledged that.

But you settled the case, and didn't you then just give up the right to reopen it? Is that -- you could have gone forward. You could have kept this thing going. You could have proved he lied.

But you didn't. You settled the case and don't you have to live with that now?

TILLOTSON: Well, no, the legal posture of the parties was, as long as he was the official winner of the tour de France race, we had to pay him.

His lawyers and Mr. Armstrong himself testified that, if he was ever stripped of those titles, we could come back and get the money back from him because we no longer had that legal obligation.

TOOBIN: That's in the settlement papers, that you have that right to go back?

TILLOTSON: Yeah, that was part of the proceedings we had, and that will be detailed, as we go forward in our legal proceedings. This is sort of a do-over.

BANFIELD: I was just going to say, I'm flat out of time because I have so many other legal cases that actually involve Lance Armstrong I need to talk about today.

But, Jeff Tillotson, if this every ends up in a courtroom in front of a civil jury, I want to be there for jury selection because I don't know anybody who ain't seen that Oprah interview, and it's like a jury pool all over the country.

Doesn't matter where you change the venue to, it wouldn't even be a change of venue.

But, Jeff Tillotson, thank you for sharing that information with us, and we'll be staying on the story with you. TILLOTSON: Thank you very much. I appreciate it. Goodbye.

BANFIELD: And, Jeffrey Toobin, you're not going anywhere because as I said, Armstrong faces that potential -- as Mr. Tillotson said, at the end, probably $15 million lawsuit.

And that might look like a parking ticket for Lance Armstrong when Jeff Toobin comes back at the bottom of the hour. We're going to talk about all of the others things that this guy is going to face, and whether what happened today makes a difference.

We're back in a moment.

(COMMERCIAL BREAK)

BANFIELD: A brutal attack on six Spanish women vacationing in Acapulco, Mexico. Masked gunmen broke into a bungalow, tied up the men who were staying there, and raped the women who were there.

Police say they have strong leads and that arrests could be coming any time.

Skiing champion Lindsey Vonn is thanking her doctors and thanking her fans after a terrible accident at the Alpine Ski World Championships in Austria on Tuesday.

Vonn seriously hurt her knee, and she issued this statement today. And here it is. I quote. "I can assure you that I will work as hard as humanly possible to be ready to represent my country next year in Sochi."

That's the Russian city where the Winter Olympics are set to be held next February.

BANFIELD: Do you remember Chris Brown and his plea deal after he assaulted his famous girlfriend Rihanna four years ago? That deal included 180 hours -- excuse me, days -- of community service.

But the Los Angeles district attorney is not so sure it was done right. And he wants Chris brown to redo it.

He called Brown's records quote, "at best sloppy documentation, and at worst, fraudulent reporting."

Out with the iron and in with the cat. This is all going to make sense here. Monopoly has switched things up: Hasbro announcing a brand new playing token just this morning. They let the fans weigh in and replace one of the tokens, so the iron is out, the cat is in, and thank god the thimble was saved for another decade.

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BANFIELD: A second day of riveting and let's just say very graphic testimony in Phoenix, Arizona, from a woman who is on trial for the savage killing of her former lover. Her name is Jodi Arias, and there she is sitting on the stand. And here's what the jury heard yesterday, when Ms. Arias decided to talk in her own defense.

(BEGIN VIDEOTAPE)

BANFIELD: A bombshell case, a bombshell defendant. Jodi Arias, a woman on trial for her life in Arizona, walking silently up to the witness stand to tell the world why she did what she did the night her ex-boyfriend was stabbed, slashed and shot to death -- she says in self defense.

JODI ARIAS, DEFENDANT: The simple answer is that he attacked me and I defended myself.

BANFIELD: The questions from the get-go are friendly. After all, this is direct exam, her lawyer asking the questions. A chance to explain everything, right from the moment she met Travis Alexander in September '06, the man she is now accused of murdering, a man she met at a company party in Vegas.

ARIAS: There was a crowd of people everywhere and out of the corner of my eye I saw somebody walking toward me. He stopped right in front of me and stuck his hand out and introduced himself.

BANFIELD: She said it didn't take long before Travis became, quote, "friendlier and friendlier." So much so she tried to cool things off by telling him she was living with someone else. But later, in an elevator, it didn't seem to matter.

ARIAS: He leaned in very close as if he wanted to kiss me and he was licking his lips and staring at my lips, like he wanted to kiss me, but he didn't.

BANFIELD: They stayed in touch after Vegas, Jodi testifying that Travis convinced her break up with her boyfriend and, within days, at a party, Jodi says the heat between them turned way up.

ATTORNEY: Was he touching you?

ARIAS: Yes, we were -- I don't really recall the specifics, but we were getting intimate. We were making out. I didn't want to do anything that would maybe displease him, not because I feared like he would get angry or anything, but I didn't want him to feel rejected.

BANFIELD: After lying through her teeth for years about this murder to police, to friends, and anyone else who would listen, she's now trying to convince a jury that she had no choice but to kill her overbearing ex-boyfriend. Just two days on the stand, and they barely scratch the surface in a story of love, lies and a grisly murder that now has Jodi Arias face to face with a death-qualified jury.

Ashleigh Banfield.

(END VIDEOTAPE)

BANFIELD: Well, let's bring in Beth Karas now from "IN SESSION", our sister network on truTV. She's been following this every single day and I'll tell you what, Beth. Every day there are more jarring details that come out on the stand no matter who takes it, whether it's Jodi herself or all of the former lovers and friends who've weighed in on this relationship, because it is all about the relationship and whether she needed to defend herself.

But first things first. She looks so quiet and mousy on the stand. And now there's this report that she has to wear a stun belt in court. What's the story?

BETH KARAS, CORRESPONDENT, "IN SESSION" ON TRUTV: Well, actually, it's a leg iron. She can't be stunned with it. It's a leg iron that would prevent her from running. So she limps a little bit. It's on her right leg, I believe, and it affects her knee joint so she can't run.

So she goes up to the stand and she leaves the stand when the jury is out of the courtroom, just so they don't see that. I mean, I'm sure the jury - they're not stupid. They probably know she's incarcerated. This is a brutal slaying, she's charged with first degree murder, the jury knows the state is seeking death, so this is not a woman walking the streets. Nonetheless, there is a prejudicial factor to the jury seeing her with this iron that clanks a little bit while she is walking.

BANFIELD: And you know it's been often said that what happens in the courtroom is like a theatrical performance in so many respects. And Jodi Arias does not look a thing like she looks in her photographs when the crime happened, and when this relationship was in full steam. Is it accidental? Or is there something more mechanical to spending, oh, I don't know, four or five years in a cell awaiting trial?

KARAS: Well, it's probably a combination of things, Ashleigh. But there's no way her attorneys would allow her to dress the way she did in some of those photos, right? They bring her her clothes, so she's dressed very conservatively, she's wearing the glasses, her hair is a natural color now. And she is sitting up there so demurely, so politely, it's hard to contrast that the Jodi Arias we have heard about from Travis Alexander's friends and seen in the photos.

But this won't be lost on the jury and I'm sure that the prosecutor is going to point this out. I mean, she's up there saving her life. She's the one who has all of the motive to tailor her testimony to make her look the best, the sweetest and most innocent, and Travis Alexander to look like the villain.

BANFIELD: And just quickly, you and I have covered a number of trials where female defendants have come out with -- this is going to sound crazy, but dark roots having gone in as blonde bombshells. And it's not every jurisdiction that will allow you to continue looking the way you look when you go in. You don't get hair dye or highlights in the clink.

KARAS: Oh no. Absolutely not. She was a brunette by the time of the slaying and, for all we know, I think she continued to be a brunette. I think she was a brunette when she was arrested, yes, in her booking photo. By the way, she wanted to put on makeup before her booking photo. She was allowed to do that and she had a nice little smile in that booking photo. But you're not allowed to have makeup -- or it's a very controlled setting. And I've had inmates tell me the tricks that they use, women incarcerated, to put makeup on. Like, even dye from magazines, they will put on their cheeks.

BANFIELD: All right. There's all sorts of tricks of the trade. That's for sure. But makeup for the booking photo, that's a new one.

Beth Karas, watching it for us, thanks very much, with our sister network truTV. And we're going to be watching today as Ms. Arias yet again, day three. And next hour on CNN.com, HLN and truTV, there will be full coverage, so make sure you stay tuned.

(COMMERCIAL BREAK)

BANFIELD: Clay Walker is a country music star living out his childhood dream, but good country music is not the only thing the fans are getting from Walker. He's also sharing with them his fight against a chronic disease, multiple sclerosis.

Here's Dr. Sanjay Gupta with today's "Human Factor".

(BEGIN VIDEOTAPE)

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Growing up in a small town the oldest of five children, Clay Walker began his life overcoming modest routes and make it on the big stage. Years later, he realized that dream: singing, touring, jamming. He was a bona fide country music star.

Almost as soon as he made it big, that dream started to fall apart.

CLAY WALKER, COUNTRY MUSIC STAR: My hands, trying to play the guitar, I couldn't even hold a guitar pick in my hand and I was devastated. I knew that something was wrong neurologically.

GUPTA: That neurological problem was multiple sclerosis. He was 26 years old. According to the first doctor he visited, his life was effectively over.

WALKER: He said I would be in a wheelchair in four years, and I would be dead in eight.

GUPTA: Walker spent years huddled with family, gripped by fear, and then he made an emotional turn. He wanted to share information about his disease with his fans. It was one way he thought to fight it.

WALKER: The biggest obstacle for people when they are diagnosed with a disease, any disease -- cancer, MS, you name it -- any disease, is the fear of it.

GUPTA: He first hunted for an expert about his disease called Relapsing Remitting MS. He wanted someone who could offer hope and knowledge about the best medications. And then Walker made a holistic change to his life: a new diet, exercise, spirituality.

WALKER: Hi, I'm country music artist Clay Walker and I live every day with relapsing remitting multiple sclerosis.

GUPTA: He regularly educates others with MS about finding a regimen that works for them. And so far, he says, he's avoided relapse for 16 years.

He also started an organization called Band Against MS, where people with MS can find information, hope, that they can live a full life, even with this chronic disease.

WALKER: I was told that I was going to die. Once you conquer the fear of the disease, it's kind of liberating.

GUPTA: Dr. Sanjay Gupta, CNN, reporting.

(END VIDEOTAPE)

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