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NEW DAY

Fire Rages on in California; Shinseki Grilled, but Won't Leave; Sterling Might Have Lawyered Up

Aired May 16, 2014 - 06:00   ET

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


(COMMERCIAL BREAK)

CHRIS CUOMO, CNN ANCHOR: Breaking news, the battle raged all night long. Firefighters up against more than they can handle from unprecedented wildfires as tens of thousands are evacuated in Southern California. Now two teens have been arrested. Did they start these fires?

And what you're looking at right now, why so many fire natives?

KATE BOLDUAN, CNN ANCHOR: Fighting back. Donald Sterling's lawyers respond to the NBA saying he did nothing wrong and he's not paying the multimillion-dollar fine. Battle lines are being drawn as the Clippers get knocked out of the playoffs overnight.

MICHAELA PEREIRA, CNN ANCHOR: Under fire. The head of veterans affairs says he's not stepping down in the face of evidence that veterans died waiting for help. Congress grilled him over what went wrong. Should he leave or is he the man to fix it?

CHRIS CUOMO, CNN HOST: Your NEW DAY starts right now.

This is NEW DAY with Chris Cuomo, Kate Bolduan, and Michaela Pereira.

CUOMO: Good morning. Welcome to NEW DAY. it is Friday, May 16th. Just after 6:00 in the a.m. In the east at least. We're going to begin with the worst wildfires we've seen in a while. A battle that has turned deadly in southern California. Police believe this was all done intentionally. Two arson suspects are under arrest.

KATE BOLDUAN, CNN HOST: In Carlsbad, fire fighters made a grim discovery during a hot spot check, a badly burned body. Here's where they stand in terms of devastation this morning. At least eight fires are burning. 10,000 acres have been scorched and dozens of structures are destroyed or heavily damaged. Dan Simon is in Escondido, California, with the very latest.

DAN SIMON, CNN CORRESPONDENT: Raging on overnight. At least eight fires in San Diego county consuming home after home. Smoke even visible from space as the blazes ravage over 10,000 acres. Evacuations now call for nearly 16,000 residences as the flames turn fatal. Fire crews discovering a badly burned body in a Carlsbad encampment. The unseasonably erratic winds with gusts up to 50 miles per hour, spreading the flames rapidly. UNIDENTIFIED FEMALE: I have never seen the Santa Ana winds, also called devil winds, in the month of may.

SIMON: Winds whipping in multiple directions causing terrifying fire tornadoes.

UNIDENTIFIED FEMALE: Another tornado right there on the other side.

SIMON: Watch this flaming vortex atop a hill spin wildly, nearly engulfing the house in front. Thousands of firefighters and military crews bombarding the blazes from all sides. Still, no match for the swift moving flames fueled by acres of dry brush.

UNIDENTIFIED MALE: It came down the hill. Once you start seeing black smoke, it was upon here within 15 minutes.

SIMON: With so many wildfires erupting one right after the other, speculation of arson on the rise. Two teens 30 miles north of San Diego now in custody being questioned for two smaller brush fires in Escondido.

UNIDENTIFIED MALE: We have developed reasonable suspicion, probable cause to believe that they were involved in setting fires.

SIMON: Unrelated to San Diego's eight major brush fires, reducing almost 20 homes now to ashes.

UNIDENTIFIES FEMALE: It was absolutely gorgeous. And now it's all gone. All gone. What can I say?

SIMON: Fortunately not everything was destroyed. Sophie's family safe salvaging a few family photos. And their dog rocky, his fur singed from the flames, found alive after being trapped in the house.

UNIDENTIFIED FEMALE: After all of this devastation, the house is completely on the ground. We were just praying at least we could find our little dog here.

SIMON: And it has been a very busy night of fire fighting in the San Diego area. In fact, it still is. We are in the town of Escondido. This is the latest area to get hit. You can see this home completely leveled. You really can't make out anything. Where you see those flames appears to be some kind of bedroom or perhaps a living room.

Chris, with so many fires breaking out basically at once, there has been real concern that we're looking at arson and, as we know, two people were taken into custody, a 19-year-old and a juvenile. They're being questioned about whether or not they are responsible for some of these other wildfires. At this point they're saying they may have started a brush fire. But a really concern that arson may be a play. Chris.

CUOMO: Just when you think it couldn't get any worse, if this was intentional, takes it to an entirely new level.

The Thunder beat the Clippers to end their season. That's not a huge shock. Neither is the latest news in the Donald Sterling scandal. CNN hasn't confirmed it yet but there are reports this morning that Sterling has lawyered up, hiring a prominent anti-trust lawyer, anti- trust is a key word there and we'll tell you why. The lawyer telling the NBA, of course, that his client has done nothing wrong and won't be paying the $2.5 million fine for his racist comments.

Let's bring in Malik Rose, game analyst for Comcast sportsnet Philadelphia and Mr. Danny Cevallos, criminal defense attorney and CNN legal analyst. Danny, I start with you for the legality here. He hired a anti-trust lawyer. Seems odd unless you understand how this situation works. Why an antitrust lawyer, Danny?

DANNY CEVALLOS, CNN LEGAL ANALYST: Well, Donald Sterling's basic argument is going to be that the NBA and its owners s colluded to essentially fix the price -- or effect the price that he would otherwise get at market value for his team. That's what antitrust is all about. You may have heard it discussed in the context of gasoline, oil cartels.

Getting together in a room and agreeing, hey, we're going to fix prices. If you raise your price I'll raise my price. That's the spirit of antitrust. What Donald Sterling is going to try to argue here is that even though he signed all of these agreements as part of the privilege of being in the NBA, the other NBA owners and commissioner Silver, what they did is they got together and agreed in some sort of conspiracy to edge him out and set a price for the Clippers that would be substantially below market value.

CUOMO: Malik let's get you in here because I need you to play professor. There's a more specific reason, also, that he picked antitrust. That's the only carve-outs as we understand it in the agreement he signed with the NBA that allows you to take a matter to ordinary courts. He waived all other types of litigation. Right? Except antitrust, so it's the only way he can go. Tell us what we know about these documents, Malik.

MALIK ROSE, GAME ANALYST, COMCAST SPORTSNET: Well, first of all, the league expected this. Ever since Adam Silver went up on the podium and said that Mr. Sterling was banned for life he knew this was coming. His lawyers around him knew it was coming. But to get into the NBA you have to sign a charter which has rules and regulations that all owners are governed by.

And that's what Donald Sterling did. He's a lawyer so he knew what he was signing. And those -- I think we have it on the screen, we can put it up. Two or three key things in those charters of the franchise agreements say specifically that the one, the NBA commissioner is the final authority on all matters involving behavior.

Series of legal documents that contain covenants directly related to unethical conduct and immoral positions and it expressly forbid owners from engaging in unethical conduct or taking positions that have an adverse effect on the NBA. That's what the league is going to go after him on. He's in violation of those agreements in that charter.

CUOMO: So, Danny, if the commissioner is the final authority on whether or not the provision is breached that you have done something or held a position that's unethical or hurtful to the league, is a lot of this more smoke than it is fire in terms of what Donald Sterling can achieve here?

CEVALLOS: That's a pretty good legal assessment. Basically because Donald Sterling agreed to all these terms, the NBA can internally do whatever it wants essentially. I mean, this may sound like a violation of due process but you don't have any due process rights when there's no government actor. And the NBA is not an arm of the government. The NBA is a private club that Donald Sterling agreed to be part of. So most experts are saying that this antitrust attack or this prong is going to be a long shot, but according to the NBA constitution, it may be one of his only shots.

CUOMO: Now, Malik, it will be interesting. Is it going to be perceived as he's just protecting his rights or do you believe this move really waters down the apology?

ROSE: Well, the apology was, let's just say, a great TV event in and of itself. I don't really know if we can classify that as an apology. But this is definitely designed -- I think Mr. Cevallos is right, this is definitely designed to slow down the process and kind of muddy the waters for the NBA. But commissioner Silver is a very, very intelligent individual and he's smart enough to hire even smarter lawyers around him to fight stuff like this.

And it's -- it's almost just like, you know, an exercise in rhetoric. This is going to have to play through and it's going to take a long, long time, which is the scary part for the NBA because listen to the players in the union, the people I have spoken to, the players are serious about this. If this takes too long and runs into next season, I don't want to think about what could happen.

CUOMO: And, Danny, let's just look down the road a little bit. First of all, he has the interview where he said I made mistakes, I hurt the league, I hurt the league. That's not going to help him in his case if he ever gets one, which he probably wouldn't. If he doesn't pays the money and they wind up oust him, do you think the league comes after him for the money or do you think they just want him gone?

CEVALLOS: That's a good question. I think the league at this point would just love for this to go away and I think that's Donald Sterling's biggest leverage at this point. Irrespective of what a jury may actually do years down the road, the one thing Donald Sterling has with the threat of litigation is leverage. The NBA would love for this to disappear if there is prolonged litigation it will do anything but disappear.

And that may be the crowbar that Donald Sterling is really bringing to bear against the league. Even if they may not fully expect their chances are that good at trial, to win an antitrust or a due process claim, they can hang the threat of litigation and actual litigation costs over the NBA for many years. And that alone may be the leverage that Sterling needs to maybe get the NBA to capitulate on some of his demands.

If they capitulate or walk back -- go ahead, Malik, make the final point.

ROSE: If they capitulate or walk back it's really going to be a problem because then it's going to fall on the players to ratchet it up. It's one thing to be able to say all of these things of Mr. Sterling but there's another thing to prove it. I don't see how he's going to be able to prove that he didn't adversely affect the brand of the NBA.

CUOMO: Well said. Better than what I was going to say anyway. Malik Rose, thank you very much. Danny Cevallos, appreciate the analysis. The scandal continues and we will continue to watch it.

Lot of other news as well though so let's get to Mick for the news.

PEREIRA: Here's your headlines. New U.N. Report warning of an alarming deterioration of human rights in eastern Ukraine. This amid a potential game changer on the ground. Thousands of steelworkers retook the city of Mariupol from pro-Russian separatists. This is a blow to the separatists who recently seized the region and held a much criticized referendum for independence.

The world's largest election has come to and with an overwhelming win for the opposition. The ruling Congress party has now conceded it has lost to a party headed by a Hindu nationalist. Corruption allegations plagued the Congress party in recent years. Millions voted in this election that lasted five weeks.

And in Turkey, at least 18 miners are still feared trapped after the worst coal mining disaster in that nation's history. Nearly 300 people are now confirmed dead. Many were laid to rest Thursday in mass burials. Now grieving family members are railing against what they call poor safety conditions and the government's indifferent response. We continue to watch that story in Turkey.

Of course, here at home, weather is a concern for us always. We know that they certainly could use rain out west but let's look at what overall we can expect for the weekend, Indra.

INDRA PETERSON, CNN METEOROLOGIST: What a contrast, the west it's so dry but out east the concern is the flooding. Thirty-four million of us today do have the threat for flood advisories. You can see them really in New York stretching through Virginia. That's going to be the problem phase. We're still talking about the exact same cold front we've been talking about all week long. This is the same one that brought snow in Colorado, if you remember way back then.

Now look at all the moisture is still hanging out on the east coast. This moisture is lining up with exactly where that cold front is. It's a slow moving cold front. That's the problem. You have rain over the same place for long period of times. You can see the radar right now and the rain is already out there and only more of it is expected to fall. And heavy amounts. The mid-Atlantic, that is the highest amounts of rain. Two to four inches possible in the mid- Atlantic and one to two in the northeast over the next two days. You can have a lot of rain in a short period of time. That's the biggest concern. Finally by Saturday this guy actually kicks out of here. Lasting a little bit longer towards New England. Scattered showers behind it. A mini short wave. This is the major system. Keep in mind the temperatures are going to back off. The weekend will get a lot better as it goes on. A little bit rainy for most people in the first half. Second half looks good. Saturday and Sunday looks good. I don't think there's anyone complaining about that.

PEREIRA: Keeping a close eye out west. Thanks.

CUOMO: It's going to rain, rain winds up the ocean. Hearing reports here among the crew that the bait is coming into the bays. Fish are coming.

BOLDUAN: Reminder, we are now entering the season where we hear Chris talk about fishing every day.

CUOMO: Fishing, also know as America's most popular past time.

BOLDUAN: Or not. Very wonderful time if you would ever take me.

CUOMO: I'll take you.

BOLDUAN: Thank you.

CUOMO: We'll go very far out into the ocean.

BOLDUAN: Oh gosh, and we'll never come back. A three-hour tour, people.

Coming up next on NEW DAY, the secretary of veterans affairs say he's mad as hell and faced a grilling from lawmakers but he's sticking with the job. Should he be pushed out? Most importantly, what is going to be done to fix the problems of the V.A.. One of the nation's top veterans organizations joining us next.

CUOMO: Wildfires, as you know, devouring southern California and drought is creating risk for more everywhere else in the state. How bad could it get, next.

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BOLDUAN: This morning, President Obama continues to stand by veterans affairs secretary Eric Shinseki who has come under withering criticism. He was grilled on Capitol Hill over allegations, uncovered in a CNN investigation, that veterans died while waiting for care at V.A. hospitals as those hospitals were holding secret waiting lists. Shinseki vowed to stay on the job saying he is not abandoning the nation's veterans. Listen.

ERIC SHINSEKI, SECRETARY OF VETERANS AFFAIRS: Any allegation, any adverse incident like this makes me as -- makes me mad as hell. I could use stronger language here, Mr. Chairman, but in difference to the committee, I won't.

BOLDUAN: Here to discuss, chief of staff for Iraq and Afghanistan veterans for America, Derek Bennett and former army captain and special assistant to General David Petraeus. Served two tours in Iraq. Derrick thanks so much for being here. Secretary Shinseki says he is mad as hell, are you, are your members?

DEREK BENNETT, CHIEF OF STAFF, VETERANS FOR AMERICA: Our 200,000 members and supporters are absolutely outraged. I personally as a veteran am outrage and quite frankly general Shinseki says he's mad as hell in the most even tone I think I have ever heard. He hasn't demonstrated to us, nor has the president, that they are actually angry about this issue.

BOULDUAN: Where is your organization right now? I have not heard if you -- if Shinseki still has the support of your organization. Does he?

BENNETT: We're still debating what we're going to decide to do as a member-driven organization. We've been polling our members for last week talking to help on the ground. We were really interested to see what the secretary was going to say yesterday. We've been disappointed with the lack of plan that has come forward from either of the V.A. or the White House.

BOLDUAN: The two largest veterans organizations in the country, they've come out. They both have different positions on if the secretary should keep his job or not. What more do you need to hear?

BENNETT: We really hoping yesterday to hear an actual plan of action with some timelines, something more than just this is the status quo, we're doing an IG investigation. We'll come back to you in August. Veterans don't want to hear that and they don't want to continue to wait in line.

BOLDUAN: Why is that not enough, Derek, for your members to know if they have to confidence in Eric Shinseki to do the job now which is most important, which is fixing the problem?

BENNETT: It was pointed out yesterday in committee that there have been dozens, scores actually of IG reports, GAO reports --

BOLDUAN: Dating back years.

BENNETT: Dating back years, exactly. This is not a new issue. So something else needs to happen beyond, just were going to giving you another report.

BOLDUAN: What is that?

BENNETT: I think the president needs to come forward and say this is the actual plan. It's not giving you another deputy chief of staff to watch secretary Shinseki work. It is here is what we're going to do over the coming weeks, not months, to solve this problem.

BOLDUAN: So the inspector general, their internal review is supposed to be out, to be finished up and reported out, we expect, by August.

BENNETT: We hope.

BOLDUAN: Is that an acceptable timeline? BENNETT: It is not, not at all. This is an issue that should be solved in weeks and days. There are actually steps that can be taken before the report comes out. We have set up with the project on government oversight a separate website, vaoversight.org that allows whistle-blowers to come forward and provide additional evidence to get all the facts on the table.

BOLDUAN: Derek, what is going on here? What is wrong with the system? What are you hearing from your members? If this -- if there are memos dating back years saying there are scheduling crisis under way, if we now have these allegations against these clinics that are horrific, that they're trying to find out if there is a causal relationship between scheduling problems and the deaths of some of these veterans, that is to be determined. What needs to be done? What are you hearing from your members? Why have people not been pounding their fists on the White House doors?

BENNETT: You know, the thing, you mentioned that it's been going on for years. It's actually been going on for decades. If you talk to Vietnam vets they will tell you they are not surprised by any of this. This is the same run around they have been given by the bureaucracy for 40 years.

We have been, our members have been, Vietnam generation veterans have been pounding on the doors of Congress, on the White House, asking for change. Folks haven't been paying attention. Now this story needs to continue to be in the public awareness. We need to continue to pay attention. Otherwise it's going to just bubble way again.

BOLDUAN: It is a huge bureaucracy, the veterans affair system. Likely not a silver bullet quick fix. Is there one thing you know that could be done that would at least start you down the real path of actual change for our nation's veterans?

BENNETT: The first and most important thing I would say is the V.A. accountability and management act which chairman Miller has brought to the house. Which increases the secretary's hiring and firing power. As you said it's a huge bureaucracy. Over 300,000 employees. It's very difficult for him to impose his will on that system.

BOLDUAN: To be quite honest, I know you're pooling your members, you're waiting to hear from your members. You are a veteran yourself. Do you personally have confidence from what you've heard from Eric Shinseki yesterday, the track record that you've seen from the V.A. Do you have confidence that he is the man to fix the problems going forward?

BENNETT: I served under General Shinseki when he was chief of staff in the army. I've seen what he can do. I'm aware of the challenges the bureaucracy has. I would give him one more shot, but he has to do some things very, very quickly and illustrate bolder form, as does the president.

BOLDUAN: You should be the one setting the timeline. What is the timeline from your organization that you need to see action? BENNETT: We would like to hear in the coming weeks, certainly before memorial day when this country takes a pause and recognize the sacrifice of it's veterans, what the plan of action is going to be, what bold steps are going to happen, not just more of the same.

BOLDUAN: Jeff Miller, you mentioned, the chairmen of the House Veterans Affairs Committee. He has said there's no way that internal review should have any confidence. He has no confidence in an internal review at the department. He says the only thing that would have his confidence is an independent bipartisan commission. Real quick do you support that?

BENNETT: We would support that.

BOLDUAN: Derek Bennett, thank you so much. Thank you for your service. Please keep us updated. Chris?

CUOMO: You know you've got a problem when you're leaving it up to the politicians to look into what happened. That's for sure. It states the urgency of the matter.

Break right now. Coming up on NEW DAY, was it arson? The number and location of those wildfires making many wonder what exactly what happened here? We're going to examine it.

Plus, who has the flight 370 data? The Malaysians say the satellite company INMARSAT didn't give it to them. The company says, yes, we did. The Australians say, well, we don't have it. Meanwhile, the families once again forced to wait. We're going to get to the bottom of it coming up.

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CUOMO: One of the scariest things about wildfires, what you're looking at right now. That is a fire-nado. One of the big problems in fighting those wildfires in California right now. The question becomes, what's going on with them? They kind of look like a twister of fire and that's because that's exactly what they are. I'll tell you I know personally to be standing when one perks up is frightening and they're tough to fight. How do they form? Lucky for us, Indra Petersons is here to explain. Tell us science.

PETERSONS: One of the biggest things that causes a fire-nado has to do with the fire brush. When you talk about the fire season you want to think about the drought conditions. This has been one of the worst drought conditions in many recent years in southern California. So what do you have? You have all of this available brush out there. Right?

Let's talk about that. We're going show you a little animation here. Fires have their invisibility circulation already on the ground. That's the concern. You have this little eddy out here. Then that eddy picks up all of this dry brush. What is brush? It releases carbon, right? We know that's combustible. You typically don't see it because there's no, general inside this tunnel. Once it gets to the top you have all of that available oxygen so you see the entire thing engulf in flames. That's what that long line is that we now know as a fire-nado.

Here is the problem, you cannot but these out in a firefight. You have to fight the fire around it because it's that invisibility combustion of gas. Another problem, they can shoot up 1,000 meters high and jump the fire lines. With that you have that huge concern of seeing those fire lines spread further and they can have damaging winds of 120 miles an hour. That's the equivalent of an ef2 tornado. The good news, Michaela, we are going to be seeing some relief. Temperatures are already going to be backing off. Marine layer is coming in and that humidity is going to go up and that's going to be the biggest factor.

PEREIRA: Yes, you and I both have been hearing, Indra, from our people in California about how hot it is. One thing that is contributing to the fires is the persistent drought. The entire state of California is in severe or worse drought conditions right now. Governor Jerry Brown is citing climate change as a factor.