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North Korea: "Framed" For Sony Hack By U.S.; White House Weighs Response To Sony Cyberattack; Raul Castrol Hails Thaw In U.S. Relations; What's Driving The Drop In Oil Prices?; Sony CEO: We Tried To Get The Movie Out; Former Employees Sue Sony

Aired December 20, 2014 - 12:00   ET



FREDRICKA WHITFIELD, CNN ANCHOR: Developing now, North Korea slamming U.S. claims that it is responsible for the cyber terror attack against Sony, saying the two countries should investigate together to find the culprit. This as the CEO of Sony says his company vows to push on.


MICHAEL LYNTON, CEO, SONY PICTURES: We have not caved, we have not given in, persevered and not backed down.


WHITFIELD: And it could be a nightmare before Christmas, as millions hit the roads and airports, a major winter storm is threatening to wreak havoc this holiday. We've got the timing and the places that could be the strike zone.

Plus, new details coming out today from the prosecutor in the Michael Brown case, what he has to say about witnesses lying to the grand jury. It's all next. You're in the CNN NEWSROOM.

Hello, again, everyone. I'm Fredricka Whitfield. Welcome to the CNN NEWSROOM. North Korea is no longer keeping quiet about the cyber- attack on Sony Pictures.

In a detailed statement reported today by the state-run news agency, North Korea claims it is being framed by the United States for the hacking.

It also threatens, quote, "serious consequences," if the U.S. continues to link Pyongyang to the attack and if it refuses to team up with North Korea in the investigation. Here now is CNN's Kyung Lah.


KYUNG LAH, CNN CORRESPONDENT (voice-over): Just hours after President Obama lands in Hawaii for the holiday, the regime lashes out via a state-run television, with all of its usual bluster, the regime slams a U.S. government's investigation of the Sony hack as childish.

That North Korea is being framed, saying, "It can prove its innocence without using any torture methods like the American CIA." Those digs come in response to President Obama that the evidence points to Pyongyang.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: They caused a lot of damage and we will respond. We will respond proportionately, and we'll respond in a place and time and manner that we choose.

LAH: North Korea directly rebuked the president, saying, it is the one who should respond, after insults to its supreme leader. But adds, it will not conduct terror against innocent moviegoers, rather, target the originators of the insults.

UNIDENTIFIED FEMALE: You two are going to be in a room alone with Kim and the CIA would love it if you can take him out.

LAH: The movie and the hack at Sony also got North Korea's bankroller and ally, China, to respond. In China's state-run "Global Times," an editorial calls the movie's vicious mock of Kim senseless cultural arrogance and that China was once a punching bag for Hollywood.

But now that the Chinese market sits as a gold mine for U.S. movies, the teasing shifts to impoverished North Korea.


LAH: The North Koreans and their fiery rebuttal to President Obama by curiously suggesting that the two countries work together in a mutual investigation to find the real culprits. North Korea saying if America refuses, there will be serious consequences. Kyung Lah, CNN, Seoul.

WHITFIELD: And federal agencies here in the U.S. have given the White House a list of possible responses to the Sony cyberattack. U.S. officials briefed on the matter say the options include economic and banking sanctions, but not adding North Korea to the list of state- sponsored terrorism.

All right, joining us now from New York, Gordon Chang, the author of "Nuclear Showdown: North Korea Takes On The World" and a columnist with, good to see you.

So, Gordon, you recently wrote in an article for "The Daily Beast" that the U.S should make North Korea pay for the Sony hack, in what way?

GORDON CHANG, COLUMNIST, FORBES.COM: Well, there are many ways that we can do that, but I think that we should impose the sanctions that the Bush administration put in place in 2005, and cutting North Korea off from the global financial system. Those were extremely effective.

And also, I think that we need to name China, because China cooperated with North Korea on these attacks. If we were to do that, we would Show the Chinese that we're not afraid to talk about the obvious. And, of course, we need to make sure that this movie gets into North Korea. That's what they were trying to prevent. And if we do that, and maybe by itself, that would be enough to deter future attacks because that's exactly what the North Koreans were worried about, that North Korean citizens would then get the idea that they could get rid of their government.

WHITFIELD: So now that North Korea has this latest response, talking about the U.S. framing North Korea and that the U.S. would suffer serious consequences if there wasn't a joint investigation, does this same something different about the motivation?

Does it say more that North Korea, you know, was grandstanding, or that this is a cry out for help, or is there some other theory behind the motivation in your view?

CHANG: Well, I think that this is typical North Korean propaganda. And, of course, they're going to try to turn the tables on the administration in Washington. But nonetheless, making sure that Sony doesn't release this movie on either online streaming sites or in DVD is really what they are looking at.

And so, they are, of course, they're looking at what Washington is going to do. But more important, they're looking at what Sony is going to do with this movie.

WHITFIELD: So do you worry now that this, that Sony, saying we're not going to have the opening, and in large part, Sony, the CEO, said it's because theaters said it would not show the movie in the United States.

But how does this empower or further embolden North Korea that, OK, this hacking thing works. Maybe there's something else up the sleeves of the North Korean government.

CHANG: Well, certainly, you know, they were happy to do that, but the theatrical release in the United States was not what they were worried about. They were worried about is South Korean activists taking DVDs, putting them into balloons that are lofted across the demilitarized zone, which separates the two Koreas and then having Korean citizens watch this.

WHITFIELD: Go ahead, sorry.

CHANG: So this is really going to be the main area of concentration of North Korea. Not what Washington does, but what the studio does.

WHITFIELD: And you think it would be interesting if Sony or maybe a third party would find a way to make sure that North Koreans do see that movie?

CHANG: Well, absolutely because that's what they were worried about in the first place. The North Koreans are willing to go to great lengths to do anything to stop that. And so we have to be prepared for escalation.

There will be escalation regardless of what Washington does, whether we do something or whether we do nothing. And if we do nothing, perhaps the escalation will be worse.

President Obama wisely talks about proportional response, but what we need is an effective response, because what North Korea did in this particular case really goes to the core of American democracy.

WHITFIELD: Yes, it really does. All right, Gordon Chang, thank you so much. Good to see you. Happy holidays.

CHANG: Happy holidays. Thank you.

WHITFIELD: All right, well, before we headed out on vacation to Hawaii, President Obama addressed the cyberattack. Erin McPike is at the White House for us now.

So Erin, the president said the U.S. will respond. You heard that underscored by Gordon there. But do we know anything more about the specifications?

ERIN MCPIKE, CNN CORRESPONDENT: Fred, I was e-mailing with a spokesman for the National Security Council earlier this morning, and she was saying that they don't have anything yet beyond what the president said yesterday, though we do know that U.S. agencies are talking about banking and economic sanctions.

But we do know also from yesterday's press conference that President Obama is resolute that the U.S. will take action.


PRESIDENT OBAMA: We take them, with the utmost seriousness.

MCPIKE (voice-over): Condemning what he called a cyber-assault from North Korea. In his year-end press conference, President Obama called out Sony Pictures for pulling the movie "The Interview," following threats to theaters.

PRESIDENT OBAMA: Sony's a corporation. It, you know, suffered significant damage. There were threats against its employees. I am sympathetic to the concerns that they faced. Having said all that, yes, I think they made a mistake.

MCPIKE: He insisted American citizens and businesses cannot be bullied into a pattern of censorship, and promised retaliation against North Korea.

PRESIDENT OBAMA: They caused a lot of damage and we will respond. We will respond proportionately and we'll respond in a place and time and manner that we choose.

MCPIKE: He also defended his most recent sweeping initiative. This week's surprise move to normalize relations with Cuba.

PRESIDENT OBAMA: What I know, deep in my bones, is that if you'd done the same thing for 50 years and nothing's changed, you should try something different, if you want a different outcome.

MCPIKE: The administration hopes its actions by helping to bring more western business to the communist nation will open it up.

PRESIDENT OBAMA: It offers the prospect of telecommunications and the internet, being more widely available in Cuba in ways that it hasn't been before. And over time, that chips away at this hermetically sealed society.

MCPIKE: And after a frenzied years end, he's got his game face on for last two years to come.

PRESIDENT OBAMA: My presidency is entering the fourth quarter. Interesting stuff happens in the fourth quarter. And I'm looking forward to it. But, you know, going into the fourth quarter, you usually get a time-out. I'm now looking forward to a quiet time-out, Christmas with my family.


MCPIKE: Now as to North Korea's new claim that it was framed, we did reach out to the White House about that and they're not yet responding about that -- Fred.

WHITFIELD: Erin McPike, thank you so much, keep us posted from the White House.

All right, so the president left to spend Christmas in Hawaii right after that news conference. And if you're also traveling for the holidays, well, guess what. You're going to want to hear the forecast, coming up. We'll have that.

Also, next, Cuba reacting to that historic change in policy with the U.S. Rosa Flores is live for us in Havana.

ROSA FLORES, CNN CORRESPONDENT: Hi, Fred. Well, days after the U.S. and Cuba reestablished relations after more than 50 years, Raul Castro makes a few requests. What he's asking from whom, next.


WHITFIELD: All right. Happening a short time ago, Cuban President Raul Castro speaking out on the major developments with the U.S. He hailed the U.S. decision to thaw relations in a speech before the country's national assembly today.

But also told lawmakers there is still a long road ahead for the two countries. CNN's Rosa Flores is in Havana for us today. So what more did President Castro say?

FLORES: Well, Fred, good afternoon. You know, one of the easiest ways, probably, to summarize this is by a quote from Raul Castro, which he said a message to his people. That's going to be, a long and tough fight for the U.S. and for Cuba as well.

That was a message to his people, because he knows, as we all know, that even though there's this reestablished diplomatic conversation, lifting of the embargo still requires action by Congress. Now, Raul Castro also had a message for other groups, including President Obama, first of all. He said, he's asking him to exercise the full powers of the executive office, through those executive orders. His message to Congress, to lift the embargo.

And he mentioned repeatedly how it impacts the economy here in Cuba. Now, the other thing that he requested from the United States is the removal of Cuba from the terrorist list.

He made it very clear, he said it very clear in that speech that Cuba has never supported or funded any activity that has caused terrorism in the United States, and that wherever Cuba has known, has had intelligence of a terrorist attack in the United States, that they have shared that information with America.

Now, here's one of the things that he didn't mention, that probably the Cuban people were expecting to hear. And those are the little details as to how this new established relationship would impact their daily lives -- Fred.

WHITFIELD: And, so, what are ordinary Cubanos saying about the potential now that the two countries are coming together and thawing and also beefing up diplomatic relations?

FLORES: You know, initially, there was this euphoria. People were very excited and happy, shocked, in fact. People they talked to on the street said, you know, the announcement came during the work, so people were at work. So at work, they were hugging.

The students had a demonstration on the streets of Havana, and then, they stepped back and said, wait a minute, so how is that going to impact our daily lives. So they're measuring their optimism at this point, trying to figure out, how is this going to impact my day-to- day.

And that's what they were hoping to hear today. We didn't hear those details, but I'm sure they're going to be anxious to learn.

WHITFIELD: Right, I guess it's still early. Nobody really knows. And in some circles, that's very exciting, and in others, that's very nerve-racking. Rosa Flores, thank you so much. We'll check back with you from Havana.

All right, that reaction is more mixed now, particularly in the U.S. some Cuban-Americans had these strong words for President Obama.

Anger coming from older generations, but in the younger generations, the feelings are much more hopeful and optimistic. For more on this, I'm joined now by a young Cuban American joining us from Miami. Raul MOAS, with the nonprofit, Roots of Hope.

Their goal, the group, is to help young people in Cuba build better futures. So Rosa Flores, I think, is also still going to join us. So Raul, what is the conversation like these days, since the announcement from President Obama, with your elders? RAUL MOAS, EXECUTIVE DIRECTOR, ROOTS OF HOPE: Sure. Fred, it's great to be here. The conversation in Miami has been very mixed and very muted. I think the clip we just saw exemplifies a very vocal, but small minority in Miami, that doesn't necessarily reflect the general trend and the general sentiments in the community.

President Obama's announcement was really broad and really deep. Not only are we republishing diplomatic relations with Cuba and its commerce increasing, but there's also a prisoner swap. So some of these moves particularly the re-establishment of diplomatic relations was really welcomed.

I would say, by most Cuban Americans, whereas others like the prisoner swap had really much more stronger feelings from that move. And so overall, though, I'd say that there is cautious optimism that the spaces created through these moves will be encouraging and will be strengthening for Cuba's society.

And that's really our homework now. How can we then take these opportunities to further grow private enterprise, further increase access to technology, further increase the flow of information, to and from the island.

WHITFIELD: So, Raul, what excites you most about the possibilities?

MOAS: Our work at Roots Of Hope has focused on using technology, private enterprise, to really further strengthen Cuba's societies, particularly young Cubans, who all they really want is to have a dignified life for themselves and their kids and their families in Cuba.

The average Cuban does not want to leave the island. If we can provide more opportunities for young Cubans to stay on the island, build a better Cuba for themselves and future generations, and in the process, be change makers, changing the society from the ground up, that really would be amazing.

And that's what I think these changes and policy on both sides hopefully represent. It's very early. We need to see how both sides implement these changes. I'm under no illusion that Raul Castro and the Cuban government will all of a sudden open up the democratic reforms.

I don't think anyone is. But we have to now put them to the test. We have to not hold them accountable to that.

WHITFIELD: And then Rosa, let me bring you back into this from Havana because many of the people living in Havana really are living in a time warp. Because there is no other reference point, to some, you know, there are no real complaints.

But when you hear Raul talk about the use of technology as something to be excited about, the average Cuban hasn't had their hands on a cell phone, are not on the internet regularly, so what is the point of view of the potential of the use of technology there from the Cubans that you've spoken to? FLORES: You know, I had a very dynamic conversation, in an area of Havana called the hot corner. People go there to chat just about anything. And it's always a very dynamic conversation. In fact, one of the individuals who was there was talking about the importance of the internet.

He called it survival. The people here needed for survival. They'd be able to communicate, for example, with their family in the United States, which is essential, because a lot of these people have been separated.

So there's the issue of separation of families that technology in the U.S. has helped even people living on coast-to-coast to keep communicating. That was one thing, of course. Intellectually, it's one of the things that, of course, a lot of these people would want to have access to.

The other thing that they pointed out was jobs. One man simply said, Rosa, we just want to work. We just want to have opportunities. And that's what people here see when they hear about the reestablishment of diplomatic relations and the lifting of the embargo.

They see opportunity. Americans coming into the United States, buying goods, tipping people, this is a tourist area, but where are the tourists? And so there's a lot of excitement and hope and there's, I think, the establishment of hope.

Simply with the establishment of a conversation between Raul Castro and President Obama, and it doesn't stop there. There are people who are really hoping that this means something new for the next generation.

WHITFIELD: And many of the tourists right now in Cuba are Europeans. So I wonder, Raul, for you, or maybe even for some of your contemporaries, are you starting to talk about or even envisioning the idea of visiting Cuba, whether it be for business opportunities or just simply to get to know the island and get to be closer to your roots?

MOAS: Without a doubt. I think you hit the nail on the head there. The genesis of our movement of roots of hope really was a desire to connect with our heritage. We are American. This is our country, but we deeply care for our parents and grandparents.

I was able to visit Cuba for the first time in March of 2011, and what I heard from every person that I met was, welcome, welcome back, in some ways. You are as Cuban as we are. And as soon as we flipped the page on this ugly chapter in our shared country's history, we're going to be OK.

The Cuban family will be OK. So we promote what we call purposeful travel. We encourage those who visit the island to bring a cell phone, to bring a flash drive, to bring information, and then to leave as well, we encourage them to go off the beaten path.

As Rosa is there, she can tell you firsthand, all the new businesses have come up, all the private bed and breakfasts and private restaurants. So really connecting with the average Cuban is something that's transformational both for the tourists that goes with that purpose and for the Cuban.

WHITFIELD: Raul Moas and Rosa Flores, thank you so much.

So let's talk about traveling within the U.S. right now for the holiday season, next week, in particular, the weather, guess what, well, it could be a bit of a problem. Meteorologist Karen Maginnis is here with us now. Karen, I wish you had good news for us.

KAREN MAGINNIS, AMS METEOROLOGIST: I do too, but we're looking at the chances for a significant winter storm developing. And a major pacific storm blasts the west coast. We'll bring you details right after this.


WHITFIELD: A winter storm is expected to create quite the delays for the holiday traveler, much like we saw over the Thanksgiving holiday. But, guess what? This time it could be worse. The storm is expected to bring snow, rain, and high winds to more than two dozen states.

CNN meteorologist, Karen Maginnis, is here to tell us what we can expect and any way to avoid it?

MAGINNIS: It looks like the Midwest is going to be the worst, but that's not going to be confined to that. We're looking at it up and down the eastern seaboard but mostly a rain event in places like New York and Boston and Washington, D.C.

But if you are traveling into or out of Minneapolis, Chicago, and Detroit, those are the key cities that you might expect some delays. That takes us through Monday, and this is going to be the pesky area of low pressure that the computer models are struggling to come together.

But it looks like out ahead of it, we've got rainfall on the backside of this, drawing in all that cold air, and the wind is going to be brisk. So we take you, going into Christmas eve, there you can see, wrapped around that area of low pressure from Minneapolis, Chicago, Detroit, maybe some of these lower Great Lakes regions.

But out ahead of it, it's wet weather in Boston and New York. But then going into Christmas day, watch out for the brisk winds along the eastern seaboard.

For the west coast, I want to show you some pictures out of King Vale. This is in the sierra Nevada, they're expecting between 1 and 3 feet of snowfall. And you can see major travel delays. And one of the things that we're looking at is a lot of rainfall in some of the coastal areas.

You may remember back in Thanksgiving, all the travel delays that we saw then. Now for the Pacific Northwest, all the way from Seattle to Portland, all the way down through San Francisco, although lighter amounts expected there, we could see upwards of 10 plus inches of rainfall in some of these areas.

I know, Fred, as incredible as that is, but this moves out into the Rockies as we go into the next several days, but it looks like pretty much big headaches for the Great Lakes region.

WHITFIELD: My goodness, something tells me a lot of folks are adjusting their travel plans now.


WHITFIELD: All right, thanks for the warning, Karen. Appreciate that.

All right, it's not just snow catching people's attention as they travel for the holidays, gas prices, too. Now, the cheapest they've ever been in five years.

It's as low as $1.69 in Dallas, hard to believe. Not that anyone is complaining about cheap gas prices. But just how did all this happen? Here's CNN's Rachel Crane.


RACHEL CRANE, CNN MONEY CORRESPONDENT (voice-over): The price of oil has plunged, falling to the lowest level since the 2009 economic crisis. But this isn't just about money lost in trading pits or saved to the gas pump, oil is a signal for the global economy.

It powers the planet, supplying a third of all energy consumed. So, in a sense, the economic activity of billions of people is reflected in the price of a single barrel of crude. Let's break down the global game of supply and demand that's driving the drop.

The world is producing more oil, especially in America. New technologies allow companies to extract oil from shale rock, boosting U.S. production nearly 90 percent since 2008.

Meanwhile, OPEC, the international cartel that represents many of the biggest oil-producing nations, isn't turning off its spigot, keeping production levels stable.

While new oil floods the market, demand is falling. Economic stumbles in Europe and China have curbed the world's thirst and oil consumption will grow by less than 1 percent this year. Low demand, high supply, a perfect recipe for falling prices, which helps one part of the economy and hurts another.

Who's benefiting? Consumers. The Energy Department expects prices to average $2.60 a gallon next year, the lowest in five years. That gives U.S consumers an extra $60 billion to spend.

Getting hurt, the American energy industry, U.S. production costs are high, and if companies scale back, that could threaten jobs, especially in states like North Dakota, Pennsylvania, and Texas.

Local jobs, international demand, American production and Chinese consumption, all that activity is summed up in a drop of oil. So watch out when oil drops.


WHITFIELD: All right. Thanks so much to CNN Money's Rachael Crane giving us details behind the drop in gas prices.

President Obama made headlines when he said Sony made a mistake in cancelling the movie theater opening after threats from North Korea. Now the CEO of Sony Pictures is firing back.


MICHAEL LYNTON, CEO, SONY ENTERTAINMENT: The president, the press, and the public are mistaken as to what actually happened.


WHITFIELD: He explains what did happen, coming up.


WHITFIELD: All right. Welcome back. I'm Fredricka Whitfield. Here's a look at the top stories making news right now.

In Australia, a woman suspected of killing eight children has been arrested. Seven of the kids who range in age from 2 to 14 were her own. The eighth child was her niece. Australian media reports that at least some of the victims were stabbed. The 37-year-old suspect also had wounds. She is being hospitalized and under police guard.

And Chrysler is expanding its recall of cars and trucks equipped with Takata air bags to more than 3 million older model vehicles worldwide. The recall comes over fears the air bags can explode and send shrapnel into drivers and passengers. Chrysler had limited its recall to areas with high humidity, where the air bags are believed to be more likely to rupture.

And amazing video to show you from an accident northeast of Atlanta, you can see an officer making a routine traffic stop. As he is returning to his car, whoa, right there, a FedEx truck barrels right into him. Rescue workers needed the Jaws of Life to pull the FedEx driver out. He was airlifted to a hospital. The officer, not seriously injured.

And a major break in one of the biggest art heists in history. Nine of 12 paintings recovered stolen from a home in Encino six years ago. Following a tip, investigators set up an undercover purchase from a man in an L.A. area hotel back in October and he's now been arrested. The recovered art is worth about $12 million.

And now a new accusation of wrongdoing in the cyberattack of Sony Pictures, and this time, it's being leveled by North Korea. Alexandra Field joining us now live from New York.

Alexandra, North Korea issuing a statement today and kind of offering a new threat? ALEXANDRA FIELD, CNN CORRESPONDENT: Yes, this comes from their state- run central news agency. The response is long, it's rambling, it's accusatory, and at the end, it has a bizarre request. We'll take a look at part of it.

In this response, they say, "Whoever is going to frame our country for a crime is going to present concrete evidence." The statement goes on to say, "That America's childish investigation result and its attempt to frame us for this crime shows their hostile tendency towards us."

And then finally it says, "We will not tolerate the people who are willing to insult our supreme leader, but even when we retaliate, we will not conduct terror against innocent moviegoers. The retaliation will target the ones who are responsible and the originators of the insults."

This statement goes on a little bit farther, but it wraps up by saying that North Korea and the United States of America should do a joint investigation. And the statement says if the U.S. fails to participate in that investigation and continues to accuse North Korea of the attack, there will be consequences.

Fred, we know, for our part, that the White House has already responded, saying there will be a proportional response to this attack. They are not talking about what the specifics of retaliation might look like at this point.

WHITFIELD: Right. And no response from this latest response from North Korea as yet. Alexandra Field, thanks so much, in New York. Keep us posted.

Meantime, CNN's Fareed Zakaria sat down for a TV exclusive interview with Sony Entertainment CEO Michael Lynton, who insists the company did not back down.


FAREED ZAKARIA, HOST, "FAREED ZAKARIA GPS": The president says Sony made a mistake in pulling the film. Did you make a mistake?

LYNTON: No. I -- I think actually, the unfortunate part is in this instance the president, the press, and the public are mistaken as to what actually happened. We do not own the movie theaters.

We cannot determine whether or not a movie will be played in movie theaters so, to sort of rehearse for a moment the sequence of events, we experienced the worst cyber-attack in American history, and persevered for 3-1/2 weeks under enormous distress and enormous difficulty, and all with the effort of trying to keep our business up and running, and get this movie out into the public.

When it came to the crucial moment when a threat came out from what was called the GOP at the time, threatening audiences who would go to the movie theaters. The movie theaters came to us, one by one, over the course of a very short period of time, we were completely surprised by it, and announced that they would not carry the movie. At that point in time, we had no alternative but to not proceed with the theatric release on the 25th of December. That's all we did.

ZAKARIA: So you have not caved in --

LYNTON: We have not caved. We have not given in. We have percent veered and we have not backed down. We have always had every desire to have the American public see this movie.


FIELD: And I asked Fareed what Lynton thinks about the big-picture message this sends that a country can be threatened unless you acquiesce to demands.


ZAKARIA: Michael Lynton was the CEO of Sony Entertainment was the publisher of "Penguin," the big publishing company, and he was publishing a few years after the "Salmon Rushti" business. And he said that the big difference there was when Salmon Rushti published his book and the Romanian government issued a fatwa, all other publishers supported Penguin Press.

All the authors came out in support of Rushti. There was general support. Margaret Thatcher famously gave police protection and security protection for his for essentially the rest of his life. In this case, he said, or he implied that they were alone. That the movie -- no other movie has stood with them.

No other movie studio stood with them. The theaters all abandoned them. George Clooney in an interview points out that he tried to get a petition signed and he could not get a single person, not an actor, not a director, to sign it, which is a really stunning and very sad commentary on the defense of the freedoms of speech. Sony seems to have been sitting there -- standing there alone.


WHITFIELD: And you can watch Fareed's full interview with Michael Lynton tomorrow on "FAREED ZAKARIA GPS" tomorrow at 10:00 a.m. and 1:00 a.m. Eastern.

All right, up next, the legal side of the cyber-attack on Sony Pictures. Former employees are suing the company for not protecting their information. Our legal guys are here. What they say about this case.


WHITFIELD: All right. Another long list of problems for Sony Pictures, former employees have now filed four lawsuits against the company. The suits claim the company ignored warnings about the attacks and failed to protect their personal information.

The suits also claim the company knew its systems were vulnerable for years. The group responsible for the attack is called the Guardians Of Peace. It says it has social security numbers of 47,000 current and former employees.

Let's bring in our legal guy, Avery Friedman, a civil rights attorney and law professor joining us from Cleveland. Good to see you.


WHITFIELD: And Richard Herman, a New York criminal defense attorney and law professor joining us from Las Vegas. Good to see you.


WHITFIELD: OK, so Richard, you first. You say, this really isn't a good case. Why?

HERMAN: Well, first of all, they hired David Boyce to represent Sony. So having said that, I think you could turn around and walk away. He may be the best attorney in the United States, but having said that, these cases are really -- I mean, they're very, very difficult to prove.

They'll probably get class action status. The damages in these cases are not large at all. It's more in a sort of remedial step to try to help Sony prepare in the future. But were they negligent? Were they reckless? Were these notices placed? Can they prove that Sony had knowledge that this was going to happen --

WHITFIELD: So even though these employees and former employees say that it was common knowledge that the system was vulnerable, even if they didn't have any real specificity of who might be hacking into it, that's just not enough, that's not enough of a defense?

HERMAN: This is the largest hack in the history of the United States.

FRIEDMAN: But the thing that I agree with is, 95 percent of the existing protocols and systems essentially would have been defeated anyhow with this kind of hack. While I agree, it might be a challenge, you know what, if you're one of the 15,000 employees, and there were 35 million files released and put in the public domain, you're going to do something.

And I think, ultimately, where this winds up is the matter is going to be granted class action status. There will be remediation. Systems, including encryption, will be put into place, but in terms of recovery, not very much.

This is an important case, principally, but in the terms of the big load on the other end, the only people that will make out will be the attorneys.

WHITFIELD: So I wonder -- I mean, I guess every employee hopes they can entrust their employer -- if I'm going to give you my social security number or anything else that is personal, that you have a safe place for it. So, is it the case that these employees would say, wait a minute, you offered us those assurances, but there are vulnerabilities, there have been vulnerabilities, and so, on that basis alone, Avery, I can, you know, build my case against you?

FRIEDMAN: And that's what the theory would be. But, again, the ultimate factual question is, were the efforts made by Sony Pictures and the corporation at large reasonably sufficient to protect employees? And that's the standard that a federal district judge is going to have to answer.

I think it's likely, since we know the existing protocols are what most companies use, as technology evolves, yes, there are going to be better ones, but in a case like this, I think it's going to be difficult for the employees ultimately to prevail on the merits.

WHITFIELD: So Richard, are there any other potential legal recourses?

HERMAN: Well, some of the legal recourses may be from the actors -- now that the movie is not being put out there in the public and they may have had a piece of the proceeds of the movie, so they can consider suing Sony based on that. I know Seth Rogen said he's not going to do it.

FRIEDMAN: What's the claim?

HERMAN: What's the claim is Sony's not releasing the movie.

FRIEDMAN: But that's different. That's different than the employee claim. We're talking about litigation.

HERMAN: The potential litigation.

FRIEDMAN: The speech issue we're --

HERMAN: We've moved on from the employee claim. I don't think it's a viable claim, Fred. I don't think it's going to go. They may smoke and mirror it up.

FRIEDMAN: The class action, the class action, Fredricka, I think is the minor legal issue. The big legal issue, to me, the speech issue. How on earth, and we got a taste of Robert Lynton's position that we'll see in more detail tomorrow.

But the fact that there was a capitulation, and I agree with the president. I think there was. Hooray for George Clooney, shame on the industry for not standing about --

HERMAN: What are you talking about? The movie theaters wouldn't show the movies?

WHITFIELD: Lynton says, we didn't acquiesce. It wasn't Sony that made that decision. But if movie theaters say we're not going to show it, there are no --

HERMAN: Exactly! WHITFIELD: There isn't a venue or place to show it.

FRIEDMAN: A contract between Sony and the exhibiters. Maybe Mr. Lynton talked about that, but it seemed to me the fear was corporate risk aversion. It wasn't about speech, it wasn't about expression. There should have been an effort. The idea of physical threats from a tin horn dictator, come on. I mean, I think -- shame on --

HERMAN: And a bomb goes off in that movie theater. Who do you think they're going to sue? They are going to sue the movie theater and sue Sony.

FRIEDMAN: That's not reasonable. That's an awful argument.

HERMAN: No, it's foreseeable and it would happen that way.

WHITFIELD: All right. And now we know what kind of arguments may have taken place in the boardroom there at Sony, right?

FRIEDMAN: I'm sure.

WHITFIELD: Stick around. We've got more. Another case we want to talk to you about. This one involving the Ferguson grand jury and words that some of the eyewitnesses lied that the D.A. knew that. Straight ahead.


WHITFIELD: The prosecutor who brought the police killing of Michael Brown before a grand jury now says some eyewitnesses were clearly lying. It has been a month since the grand jury decided not to indict Officer Darren Wilson for Brown's death.

St. Louis County Prosecuting Attorney Robert McCulloch spoke to radio station, KTRS, about this case.


BOB MCCULLOCH, ST. LOUIS COUNTY PROSECUTING ATTORNEY (via telephone): Even though they're not under oath, that's another potential offense, a federal offense. But I thought it was much more important to present the entire picture and says, this is what this witness said she saw.

Even though there was a building between where the witness said he was and where the events occurred, so they couldn't have seen that or the physical evidence didn't support what the witness is saying.


WHITFIELD: All right, let's bring back our legal guys. Avery and Richard, OK, I'm seeing the head shaking already. McCulloch says that eyewitnesses were lying and he won't pursue perjury charges.

Should these witnesses be prosecuted for perjury or Richard, should it be the case that the prosecutor faces some sort of charge or admonishment for knowing that they were lying but still presenting them to the grand jury?

HERMAN: Well, Fred, I actually praised him the way he handled the grand jury process in the Michael Brown case. Now I'm calling for his immediate resignation as a prosecutor.

Fred, you have no conception of how important the grand jury is. If you don't make a deal before there's an indictment, you're in another realm. Any plea deal you make is going to be through the roof. You're not going to get such a good deal anymore.

People do not know the impact of an indictment once it hits someone. People lose bank accounts, they lose friends. They lose partnerships. They lose jobs. Just on a mere indictment. Just on an allegation. The grand jury process is sacrosanct. And if some people get in front of a grand jury and intentionally lie

and the prosecutor knows they're lying, they must be prosecuted Martha Stewart, while she's setting the Christmas table, can't believe it.

She got convicted of lying to the feds. Not securities fraud. These people are going to walk. They should all be indicted, all these people who lied, including the grand jury.

WHITFIELD: OK, so Avery, why do you disagree so vehemently against what Richard is saying because he's talking about not only should the prosecutor be facing -- should be fired or resigned, but that people who are perjuring themselves should be punished as well. Do you disagree?

FRIEDMAN: Let's dial it down. My view is -- and Richard's not going to disagree with this. The fact is that every day in courtrooms all across America, people are not telling the truth. Is everyone indicted for --

WHITFIELD: But isn't it something then when you know someone's not telling the truth and still present them, that they are a credible eyewitness, aren't the grand jurors counting on you to say that this is a credible witness. But if it turns out that this is not a credible witness and you knew that, I mean, who are they supposed to believe?

FRIEDMAN: The grand jury has the obligation to make its own independent assessment. And the reason, I think --

HERMAN: Not the issue.

FRIEDMAN: -- the other argument that we indict everybody and throw the prosecutor out. Totally misses the issue that prosecutors have discretion. If you're going to indict everybody, you're going to shut down our judicial system.

HERMAN: Wrong.

FRIEDMAN: I think, and I'm saying this respectfully, it's nonsensical. The fact is that McCulloch had to make a judgment. There were white witnesses, there were black witnesses. Many of them were not truthful -- HERMAN: That has nothing to do with this.

FRIEDMAN: -- over 60 witnesses, what are you going to indict everybody? It's just, I think, an impractical, and frankly irrational decision.

WHITFIELD: All right, so we should all be thinking, then, in any kind of grand jury process, that there is a possibility that there is no vetting of eyewitnesses, that anyone who claims to have seen something, anyone and all of those people would be called to the grand jury? It seems like the answer is no. That there would be some sort of vetting. And there's a selection process, as to which eyewitnesses are presented, right?


WHITFIELD: OK, listen --

FRIEDMAN: But when a prosecutor doesn't guarantee what a witness is going to say. They may believe -- the prosecutor may believe that a witness is not being truthful --

HERMAN: If the prosecutor states.

FRIEDMAN: The grand jury --

HERMAN: If a prosecutor states --

WHITFIELD: Go, Richard.

HERMAN: If the prosecutor states, I know this witness lied in front of the grand jury, that witness is like a loaded gun at someone, and that is attempted murder. And if a witness goes in front of a grand jury and intentionally lies to deceive the grand jury, that person must be prosecuted.

FRIEDMAN: It's unbelievable, Fred.

HERMAN: He's saying, I know these witnesses lie! They have to be prosecuted.

FRIEDMAN: It happens every day!

HERMAN: Doesn't matter. They have to be prosecuted?

WHITFIELD: OK, now we are all learning something. This has been very enlightening to hear his conversation, and then to hear, too --

FRIEDMAN: The reality of the system, right.

WHITFIELD: Avery, that you say, yes, that is the reality. This is not unusual. All right, Richard, Avery, thanks so much. Happy holidays. We've got our Christmas colors on?

FRIEDMAN: Feliz Navidad. We didn't call each other. I want you to know that. WHITFIELD: I know. It just works out that way. All right, gentlemen, thank you so much. Good to see you. And we will be right back.