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NEW DAY

Rim Fire Burns 144,000 Acres; Fighting The Flames From Above; UN: Snipers Fired On Inspection Vehicle; Sandusky Settlements; Powerball Winner Revealed; New Amanda Knox Appeals Trial; Donald Trump Sued; Taylor Swift Drama?; MTV Video Awards; Justin Timberlake's Big Night

Aired August 26, 2013 - 07:30   ET

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


CHRIS CUOMO, CNN ANCHOR: Hope the morning is working out the way you want. Welcome back to NEW DAY. It's Monday, August 26th. Coming up in the show, Amanda Knox turns out that she is going to be retried for murder in Italy, but she has no plans to be in the courtroom or even in the country. She told us that this is the moment that has haunted her. You are going to hear what she had to say coming up.

KATE BOLDUAN, CNN ANCHOR: Also Donald Trump back in the headlines. He is being sued for tens of millions of dollars. We are going to tell you why the state of New York is taking him to court over his real estate school. New York Attorney General Eric Snyderman is talking to us in a live exclusive.

CUOMO: All right, a lot of news this morning. So let's get right to the top stories -- Michaela.

MICHAELA PEREIRA, CNN ANCHOR: Top story is the fire we are watching, only seven percent containment reported on California's rim fire, which has now burned through 144,000 acres, 3,400 firefighters now battling the wildfire, which has charred 12,000 acres inside Yosemite National Park. Check out the video posted on YouTube by the California Air National Guard providing a really unique perspective for what it is like for those crews fighting this massive wildfire from above.

U.N. inspectors in Syria investigate a possible chemical attack when snipers started shooting at their vehicle. U.N. officials say the team made it safely back to their checkpoint. They are getting another vehicle and will return to their task. The Assad regime had promised a cease fire in cooperation for this inspection. U.S. officials say the access comes too late to be credible.

Jerry Sandusky's adopted son and six other victims have settled lawsuits against Penn State. Amounts of the child sex abuse settlements were kept confidential. Sandusky, the university's former assistant football coach was convicted last year and is serving at least 30 years for child sex abuse. Penn State is facing some 30 lawsuits related to the Sandusky case and set aside $60 million for payouts.

A New Jersey man claiming the last share of this month's $448 million Powerball jackpot, Mario Scarnichi, chose the cash option and will get about $62 million after taxes. Sixteen New Jersey vehicle maintenance workers and a Minnesota man had the other two winning tickets.

All right, these young Texas ladies aren't worried breaking a nail. They are noodlers. What is that you asked? Well, my friends, it means they get into the water and grab huge catfish with their bare hands. One of them is 19-year-old Lucy Millsap, won a tournament this summer by noodling a 72 pounder. The sport was actually illegal in Texas until a couple of years ago and then they came to their, question mark, senses?

BOLDUAN: There is a show about this.

PEREIRA: Hand fishing is a different thing. They go into a mud bank.

BOLDUAN: The only reason I knew about noodling is Paul Ryan is into it.

CUOMO: I think it is hard core. The intro to the show is something like sitting in a boat with a rod and catching fish, where is sport in that? What have I been doing my entire life?

PEREIRA: Are you going to come up with a different way of doing it?

CUOMO: Way too much of a woos.

BOLDUAN: I don't know. I don't understand it. Why was it illegal? We'll continue to contemplate that.

CUOMO: A big announcement from Amanda Knox. Her lawyer says she will not go back to Italy to stand trial yet again for murder. Knox was convicted and then acquitted. Now the case is being examined once more specifically the discredited theory that Knox killed her roommate during a sex game gone wrong. The possibility of another trial has haunted Amanda Knox since we spoke to her in May.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Will you go face the trial? Will you go back?

AMANDA KNOX, FACING NEW MURDER TRIAL IN ITALY: I don't know yet. It is a really complicated question.

CUOMO (voice-over): The answer turned out to be simple. No. Amanda Knox will not return to Italy for a new appeals trial over the 2007 murder of her British roommate, Meredith Kercher. In May, Knox relayed her deep and obvious worries about what might happen in the country where she spent four years behind bars.

KNOX: I'm afraid to go back there. I don't want to go back into prison. I don't want them to do a court order when I'm there just respecting the court and going there and the prosecution asks that I be put in preventive detention again. I mean, I was there for four years.

CUOMO (on camera): Could you handle it?

KNOX: I'm having to handle things. I am not really being given a choice and I think people sort of under estimate what that means and what affect that has had on me in my life. I'm afraid. I'm so afraid.

CUOMO (voice-over): A fear born when Knox at just 22 years old was convicted of brutally killing her roommate. That ruling was overturned in 2011 due to lack of evidence. Knox returned home to Seattle.

KNOX: Thank you to everyone who has believed in me.

CUOMO: Italian law doesn't recognize double jeopardy is in the U.S. The Supreme Court there announced it would retry the case saying the jury hadn't considered all the evidence and must resolve deficiencies and contradictions of witness accounts. The case made world headlines in large part because of the prosecutor's unorthodox theory. Knox and her then boyfriend killed her in a sex game gone wrong. The media dubbed Amanda foxy-Knoxy though no concrete evidence justified the bizarre accusations or linked Knox to the murder.

KNOX: No one has claimed I was taking part in deviant sexual activity, none of my roommates and friends. That is simply coming out of the prosecution. No witnesses have ever come out saying anything like that. They created this idea about me because it would legitimize their accusations against me.

CUOMO (on camera): That means in your mind you spent four years of your life in jail because of a perverted prosecutor?

KNOX: That's what I think.

(END VIDEOTAPE)

CUOMO: Imagine living with that. This has been years for this young woman since she beat this case. Italy is different than the United States. They could order in Italy that you come back for a retrial. There is an extradition treaty I have in my hands. But United States law does not avail its citizens to threats of double jeopardy. Once you are acquitted or convicted the case is over barring very specific exclusion.

So the U.S. in all likelihood would not send her back to do this. It is one of the reasons we criticize the U.S. legal system until you compare it to any other. This is haunting for her. When we did the interview all Amanda Knox wanted was to deal with the harshest ammunition that the prosecutor had. They were ugly questions, ugly suggestions.

She said let me answer them because this is all the case was about over there and when you look at the evidence, you do see where Amanda Knox is coming from that this theory which is dominated discussion of the case in the absence of real proof of it. Now we have to see what happens.

BOLDUAN: The saga continues. It has been years for her that she has been dealing with it. CUOMO: Really going on with your life when you never know if the system will let you go. She doesn't know if she will ever be able to go back to Italy.

BOLDUAN: Coming up next on NEW DAY, life or death? Will convicted murderer Jodi Arias heading back to court today. A new trial set to start, will she get the death penalty?

CUOMO: Plus, the Donald, he is big and brash. He is a lot of things, but is he a fraud? That is what New York Attorney General Eric Schneiderman says he is. We will have an exclusive live interview with the attorney general and then we're going to get Trump's rebuttal straight ahead.

(COMMERCIAL BREAK)

BOLDUAN: Welcome back to NEW DAY. A $40 million lawsuit filed against Donald Trump by the state of New York. It charges Trump's real estate school was making false promises and building thousands of students out of money. In just a moment, we're going to hear from the man who filed that lawsuit, New York Attorney General Eric Schneiderman, but first here is CNN's Alison Kosik with the background.

(BEGIN VIDEOTAPE)

ALISON KOSIK, CNN BUSINESS CORRESPONDENT (voice-over): He is America's most famous billionaire, never one to shy away from the spotlight. From his "Apprentice" reality show to his almost run for the White House to his demand that President Obama hand over his birth certificate, now Donald Trump is grabbing headlines again in a bomb shell lawsuit accusing him of fraud.

DONALD TRUMP, REAL ESTATE MOGUL: At Trump University we teach success. That is what it is all about success. It is going to happen to you.

KOSIK: But New York State's attorney general says that promise was empty for students at the real estate mogul's investment school, Trump University. The state wants $40 million for what it says the school wrongly took from people who attended classes.

TRUMP: We are going to teach you about business and teach you better than the business schools teach you.

KOSIK: It alleges Trump misled perspective students with a bait and switch. If they wanted to get rich they would have to pay $1,500 for a three-day work shop and then came the push for a yearlong force at $35,000. The lawsuit says instructors even urged students to call their credit card companies to increase limits so they could sink even more money into classes.

Classes Trump defended in a tweet saying there was a 98 percent approval rating of students per courses. Another allegation says students were told Trump would make an appearance during the seminars. Instead they had their photo taken with a life-sized picture of him. LAURA RIES, MARKETING STRATEGIST: They wanted to be near Donald Trump and I think that was the biggest problem.

(voice-over): A Trump attorney says the lawsuit has no merit and it is a cheap publicity stunt. Alison Kosik, CNN, New York.

(END VIDEOTAPE)

CUOMO: Well, here to refute Trump's claim that the lawsuit is a stunt is the New York Attorney General Eric Schneiderman himself. Thank you for being here, Mr. Attorney General. Appreciate it. Can you tell us -- this lawsuit wasn't initially targeting Mr. Trump. It was part of a larger investigation, right? Tell us about it.

ERIC SCHNEIDERMAN, NEW YORK ATTORNEY GENERAL: Well, we have been looking into for profit schools. We had a $10 million settlement with another one a week or so ago. We started looking at Trump University and discovered that it was a classic bait and switch scheme. It was scam starting with the fact it was not a university. They never registered. They lied. Part of the charges are they lied to the State Department of Education repeatedly. They never got their teachers certified as required by New York law. They promised to teach people with handpicked experts by Donald Trump.

The teachers were neither handpicked nor experts. Some of them had just come out of bankruptcy from their real estate ventures. It was really a bait and switch. People were told in the pre-seminar you have to pay for the $1,500 seminar. They said you have to go with these elite packages from $10,000 to $35,000. We got the play book, telling the Trump instructors what to say and they were clearly instructed that if one of them broke ranks and said you don't need to buy the packages that would hurt the whole enterprise.

CUOMO: Can you show that Trump knew because, you know, he lends his name to lots of things.

SCHNEIDERMAN: We had the sworn testimony of the former president of the Trump University. Mr. Trump claims he wrote the curriculum. The president said he insisted on seeing all the promotional materials and he was the pitchman. He was in the videos. People came to the seminars thinking they would meet him. In fact, all they got the chance was top stand next to a poster of Mr. Trump. He clearly was involved.

CUOMO: Mr. Trump says you were begging him for campaign contributions and that's what this is about. Your response?

SCHNEIDERMAN: We are used to people who commit fraud making wild accusations when they are caught and it's just an effort to distract from the substance of the case. He has not rebutted. We have provided in our pleadings copies of the ads, copies of the scripts, transcripts of what his instructors said. We have dozens of affidavits and complaints.

CUOMO: He says you met with the president on Thursday and filed this on Saturday suggesting a connection. Fair to say Mr. Trump did not come up when you met the president of the United States?

SCHNEIDERMAN: The president and I had much more important stuff to talk about than Donald Trump. He was giving a speech about education in Syracuse. Trump didn't come up. I never discussed Mr. Trump with the president of the United States and he didn't know anything about this case.

CUOMO: Mr. Trump also says he could have settled this suit if he wanted to, but he is not going to now. Do you have an interest in settlement or are you going to litigate?

SCHNEIDERMAN: We are always open to discussions. This is a pretty straightforward case. The documents we have submitted already I think pretty much entitle us to a judgment. Again, we have the sworn testimony of the former president of the Trump University acknowledging pretty much everything I told you, that they didn't comply with the law. He called it an oversight. This is a case that will move quickly.

CUOMO: I have to believe that Mr. Trump stirring the pot is not helping them with your office.

SCHNEIDERMAN: I think that's fair to say. He is a showman. He doesn't seem to think there is any such thing as a bad headline where he is concerned.

CUOMO: Mr. Attorney general, thank you for joining us this morning. I appreciate your perspective on the case. In the next hour, we are going to get live reaction from Donald Trump himself. Kate, over to you.

BOLDUAN: Thanks so much, Chris. Coming up next on NEW DAY, Justin Timberlake cleans up at the VMAs and brought along new friends to help celebrate.

Plus, why everyone is talking about Miley Cyrus.

(COMMERCIAL BREAK)

BOLDUAN: Welcome back, a big night last night for Justin Timberlake at the MTV Video Music Awards. He won video of the year for "Mirrors," but he also gave fans a highly anticipated blast from the past. Entertainment correspondent Nischelle Turner is here with the big highlights.

NISCHELLE TURNER, CNN ENTERTAINMENT CORRESPONDENT: Yes. It was the big rumor, guys. Would 'n sync give us a blast of boy band love and on a night when Justin Timberlake was crowned the king of pop, only fitting for the fellows to reunite.

(BEGIN VIDEOTAPE)

TURNER (voice-over): A beloved boy band got a big welcome back. The hotly rumored 'N Sync reunion became reality, finally, at Sunday's MTV Video Music Awards.

(on camera): Might be a little excited about 'n sync?

UNIDENTIFIED FEMALE: A little too excited.

TURNER (voice-over): It a night full of memorable moments for Justin Timberlake. The singer capped off a near 20-minute medley of his hits by receiving the "Michael Jackson" video vanguard award from his pal Jimmy Fallon. The show famous for its surprises had a few more to offer. Lady Gaga returning to live performing after hip surgery in April opened the broadcast with four costume changes while performing "Applause."

And somehow seemed tame when compared to Miley Cyrus while singing "Blurred Lines" a stripped down Cyrus got R-rated with a foam finger. Macklemore and Ryan Lewis were the night's top winners taking home best hiphop video and best video with a social message for "Same Love," a marriage equality anthem.

(on camera): Not only were you making fun music, but making socially conscious music, too.

UNIDENTIFIED MALE: At the same time.

TURNER (voice-over): Taylor Swift lit up Twitter after appearing to utter an expletive when One Direction, and rumored former love interest, Harry Styles appeared on stage. The more than two-hour show wrapped with a live Katy Perry concert under the iconic Brooklyn Bridge.

(END VIDEOTAPE)

TURNER: All right, Katy Perry was great, good for Gaga coming back from hip surgery. Miley, I think, is in traction this morning.

BOLDUAN: I don't even. Let's just move it on. Thanks so much, Nischelle.

CUOMO: Coming up on NEW DAY, Trump University, a $40 million lawsuit says it's neither Trump nor university, but he's going to respond, coming up.

BOLDUAN: Also ahead, U.N. inspectors granted access to decide of an alleged chemical attack in Syria. But will the U.S. be forced to act?

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: This is probably one of the worst ones that I've been on, if not one of the more extreme fires I've been on.

(END VIDEO CLIP)

CUOMO: Defending Yosemite, thousands of firefighters working nonstop as a wildfire tears through the iconic park. The famed giant sequoias gnaw in the crosshairs. We're live with the latest. BOLDUAN: The U.S. now says the Assad regime almost certainly did use chemical weapons on the Syrian people. The calls for action are growing, will the U.S. send in airstrikes?

PEREIRA: Trump fires back. The Donald is sued claiming his Trump University are a scam. He joins us live this morning.

CUOMO: Your NEW DAY continues right now.