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ERIN BURNETT OUTFRONT

Giuliani: Ivanka Trump is Off Limits, Kushner is "Disposable"; Giuliani: North Korea to Release U.S. Prisoners, White House Can't Confirm; Sources: Trump Legal Team, White House Blindsided By Giuliani Bombshells; Sanders Learned About Trump Repaying Hush Money Last Night. Aired 7-8p ET

Aired May 3, 2018 - 19:00   ET

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


[19:00:00] PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT: -- surprise if it were going to happen, because obviously the North Koreans want to have something like this before that crucial summit. Brianna?

BRIANNA KEILAR, CNN SENIOR POLITICAL CORRESPONDENT: Paula Hancocks, thank you so much. I'm Brianna Keilar, and thank you for watching. Erin Burnett OUTFRONT starts now.

ERIN BURNETT, CNN ANCHOR: OUTFRONT next, Trump and Giuliani going it alone, blindsiding the White House staff and legal team.

Plus, Sarah Sanders unable to answer basic questions, admitting she's in the dark. Does the White House press secretary have any credibility left?

Plus, Giuliani touting the release of three Americans held by North Korea. Except for they weren't released. Why is the president's personal attorney breaking national security news?

Let's go OUTFRONT.

And good evening, I'm Erin Burnett. OUTFRONT tonight, blindsided. That's how President Trump's legal team says they're feeling tonight. Thanks to Rudy Giuliani's 24-hour media blitz starting with the bombshell that President Trump paid Michael Cohen back the Stormy Daniels hush money.

(BEGIN VIDEO CLIP)

RUDY GIULIANI, TRUMP PERSONAL LAWYER: Funneled through a law firm and the president repaid it.

SEAN HANNITY, FOX NEWS HOST: Oh, I didn't know that. He did?

He fired Comey because Comey would not, among other things, say that he wasn't a target of the investigation.

We got Kim Jong-un impressed enough to be releasing three prisoners today.

Jared is a fine man. You know that. But men are, you know, disposable. But a fine woman like Ivanka? Come on.

(END VIDEO CLIP)

BURNETT: Each one of those statements leaving a trail of chaos on the president's own team. For example, the president, of course, said not even one month ago that he did not know about the Stormy Daniels' payment. And those American hostages? The White House says it can't confirm they're being freed today.

CNN is learning members of Trump's legal team are angry tonight, saying Giuliani was not prepared, winging it was the word they used. In fact, the president's press secretary was even at a loss. The best she could do, refer questions back to Giuliani.

(BEGIN VIDEO CLIP)

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: I'm not part of the legal team and wouldn't be part of those discussions. I would refer you back to the statements, pretty lengthy statements, made by Giuliani, both last night and this morning.

(END VIDEO CLIP)

BURNETT: OK. Well, Giuliani's explosive comments made front page headlines across this country and across the globe. And Sanders was actually being diplomatic. One White House aide said Giuliani's interview stunned and shocked Trump's communications staff too of which of course she is the leader. Imagine how you'd feel if you were the president's spokesperson, and you had to go on camera, in front of the world, and admit this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: When did you specifically know that the president repaid Mr. Cohen for the $130,000? You personally?

SANDERS: The first awareness I had was during the interview last night.

(END VIDEO CLIP)

BURNETT: OK. I mean, just think about that for a second. It certainly seems like her boss, President Donald Trump, has not been telling her or the American public the full story. But let's just play the president's own words on Air Force One. This is April 5th.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Did you know about the $130,000 payment to Stormy Daniels?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: No.

UNIDENTIFIED FEMALE: Then why did Michael Cohen make those if there was no truth to her allegations?

TRUMP: You'll have to ask Michael Cohen. Michael is my attorney. And you'll have to ask Michael.

UNIDENTIFIED FEMALE: Do you know where he got the money to make that payment?

TRUMP: No. I don't know.

(END VIDEO CLIP)

BURNETT: So, is Giuliani saying Trump repaid his lawyer, a $130,000 to pay off a porn star, and didn't know about it? No wonder there's chaos and anger at 1600 Pennsylvania Avenue tonight.

Jeff Zeleny is OUTFRONT live at the White House. And Jeff, people inside the White House had no heads-up at all on what Giuliani was about to do. I mean, the president's own press secretary having to admit today she had no clue any of this even happened until Rudy Giuliani said it on Fox News last night.

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Erin, that was shocking. But I will tell you, not surprising. After what is this, 15 months or so of covering this administration, this White House, a pattern has emerged. The president sets the tone here, he tells his staff what he wants to tell them.

So the press secretary has come out before us many, many times saying things she says are true at the moment, they turn out not to be true. But there is little question, based on a day long of conversations here with people, they were legitimately shocked by what Rudy Giuliani was doing last night. And if there's a credibility crisis, which one could argue there certainly is, that is rooted in the Oval Office. It's not a problem of the press secretary, it's certainly hers to deal with.

But the reality here, Erin, is this. There were two things going on today. There was the political fight going on, that's what Rudy Giuliani was leading. That is the arena he is sharp and good in.

The legal fight, it seems to me, will have to sort of be on the back burner for a touch. But the question is, as we leave, did the legal fight get complicated by pushing for the political fight here?

[19:05:05] But one thing is clear --

BURNETT: Yes.

ZELENY: -- the White House press shop, the people we see as the face of this White House, they knew nothing about what was going to happen last night, Erin.

BURNETT: All right, thank you very much, Jeff Zeleny.

I mean, it's just -- I'm sorry, I can't get over this. I mean, just to have at least the respect for your own press secretary, who's in charge of convincing the rest of the world that they believe in you, so everyone else should. The first I found out about it was last night during the interview. I can't get over it. OUTFRONT now, Paul Ryan, vice president for policy and litigation at the watchdog group Common Cause, which filed the complaint with the FEC, the Federal Election Commission, and the Justice Department about Cohen's payment to Stormy Daniels. Gloria Borger, our chief political analyst, and Harry Sandick, former assistant U.S. attorney for the southern district of New York.

Gloria, I want to start with your reporting, blindsided. The brand- new White House legal team, let's just emphasize this, brand-new, all these new heavy hitters, you got all these people in there were ready to go and they're blindsided and angry.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Well, they are. And, you know, my colleagues, Pamela Brown, Evan Perez, and I have been reporting this all day. And what we're hearing is words like, blindsided. The president threw a grenade into all of this. That Giuliani was winging it.

And that, you know, Giuliani has said that he spoke with the president about this, and as we've said all along, the president is his chief legal strategist --

BURNETT: Yes.

BORGER: -- so maybe they concocted this together. But it might have been nice for them to talk to the rest of the legal team about whether he ought to be doing this. Because their sense of Giuliani, from speaking to them today is that, he's the guy who ought to be out there delivering the message they need to deliver. Which is, the president's being treated unfairly --

BURNETT: Yes.

BORGER: -- Comey doesn't tell the truth, the Department of Justice needs to start dealing with Congress, and needs to start cooperating, and the president won't testify unless these questions are fair, et cetera. All of that.

Instead, what he did was he started talking about Stormy Daniels. He raises an issue nobody wanted to talk about. And oh, by the way, in doing that, he contradicted what the president himself has said. So he created more headaches for this new legal team, not less.

BURNETT: And, you know, Harry, you're a lawyer, so let's just talk about this, right.

HARRY SANDICK, FORMER ASSISTANT U.S. ATTORNEY, SOUTHERN DISTRICT OF NEW YORK: Yes.

BURNETT: You've got these legal advisers in there, they're blindsided, they're angry. You heard Gloria saying grenade was the word that one of them used. Emmet Flood, powerhouse attorney who represented Clinton on impeachment joined this team yesterday.

SANDICK: Right. BURNETT: And everybody said this is a game changer, you've got this guy on here. Are people like that going to want to stay on this team? I mean, how damaging is this for this new team?

SANDICK: I think it's damaging, and I think it's something that has to be worked out quickly. The lawyers have to get into a room together, and they have to make clear that no one's going to throw any grenades until there's a decision that a grenade needs to be thrown.

The president intro -- the president's lawyer, Giuliani, introduced all sorts of doubt about what happened with Cohen, about what the real reason for firing Jim Comey was. There was no need to talk about any of that.

BURNETT: Right. All of those things, which we played several of them, you know, were completely unnecessary in the context of what at least the legal team thought they wanted out there, Paul. And I want to turn to more of what Giuliani said.

Of course we remember Trump denied knowing about the payment made to Stormy Daniels. Let me just play that again because it wasn't even one month ago. Here's the operative question.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Do you know about the $130,000 payment to Stormy Daniels?

TRUMP: No, no.

(END VIDEO CLIP)

BURNETT: OK, that's the two-word answer, "no, no." So, here's what Giuliani said last night, Paul, about the payment.

(BEGIN VIDEO CLIP)

GIULIANI: The president repaid it.

HANNITY: Oh, I didn't know that. He did?

GIULIANI: Yes.

HANNITY: There's no campaign finance law.

GIULIANI: Zero.

HANNITY: So the president --

GIULIANI: Just like every -- Sean --

HANNITY: So this decision was made by --

GIULIANI: Everybody was nervous about this from the very beginning. I wasn't. I knew how much money Donald Trump put into that campaign, and I said, $130,000? He could do a couple of checks for $130,000. When I heard of Cohen's retainer of $135,000, when he was doing no work for the president. I said, well, that's how he's repaying -- that's how he's repaying it with a little profit and a little margin for paying taxes.

(END VIDEO CLIP)

BURNETT: All right, so Paul, Giuliani seems to be saying, right, and you got to read between the lines. But what it seems he's saying is, yes, Trump paid him back but Trump did might not have even known he was repaying Cohen, right. He's paying this retainer, it's going to nothing, I have this great idea, let's apply it towards that porn star, we're done with this.

Does it matter if the president did not know that he was repaying Cohen?

PAUL RYAN, VICE PRESIDENT FOR POLICY AND LITIGATION, COMMON CAUSE: It matters. It doesn't change common cause's allegations that there was an illegal contribution from Cohen to the Trump campaign, and that the Trump campaign violated campaign finance law by failing to disclose this. But I'm going to back up a step.

BURNETT: Yes.

P. RYAN: I cannot believe that Donald Trump at some point didn't become aware, didn't know about this payment to Stormy Daniels.

[19:10:03] And it was at that point that he had a legal obligation to have his political campaign amend their disclosure reports and report this political expenditure.

You know, Rudy Giuliani gave America evidence that the president committed a crime. We don't know the timing of the crime, but I cannot imagine he didn't know at some point that Michael Cohen had made this payment on his behalf.

BURNETT: Now, of course, Harry, he's saying he didn't know, right? He went on Twitter today and said this sort of thing happens all the time with celebrities, they're wrongly accused, you paid -- you know, have this happens, so it's a -- don't worry about it, there's nothing to see here.

He also tweeted, "Mr. Cohen, an attorney, received a monthly retainer, not from the campaign, and having nothing to do with the campaign, from which he entered into through reimbursement a private contract between two parties known as a nondisclosure agreement or NDA.

"By the way, I just want to make it clear, it's obvious Mr. Trump did not write this tweet, a lawyer did.

SANDICK: It doesn't sound like him.

BURNETT: OK. But Trump -- Trump on his Twitter account is saying the repayment had nothing to do with the campaign. Is it possible? Do you accept that? SANDICK: The timing of it makes it very hard to accept that. And in fact, one of the other things that Rudy Giuliani said last night was he stressed that this payment was made, thank goodness Michael made it, it was right during the heat of the campaign, he did the right thing to make the payment, drawing the connection between the payment and the campaign that would make it a FEC violation and against the law.

BURNETT: Now Gloria, Michael Cohen, of course, said in a statement, this was back in February, "I used my own personal funds to facilitate a payment of $130,000 to Ms. Stephanie Clifford", that's Stormy Daniels. "Neither the Trump Org or the Trump campaign was a party to the transaction, and neither reimbursed me for the payment directly or indirectly."

Now this would appear to be very confusing, right? Because obviously now they're saying he got -- he was repaid. So, you know, the Washington Post -- then Giuliani goes to the Washington Post today as part of his 24-hour media blitz, Gloria, and he says -- when asked when the president was told about the payments, Giuliani says, he wasn't, since it was somewhere 10 and five days before the election. "He wasn't told. Even if he was told, he wouldn't have remembered it, like I wouldn't have remembered it."

I mean, there's so much in here, Gloria but could we start this.

BORGER: Well --

BURNETT: Is it serious? He couldn't have remembered that someone's like, hey, I just paid $130,000 to this porn star --

BORGER: No!

BURNETT: -- for you?

BORGER: Of course. Of course he -- it's hard for me to believe that he wouldn't have remembered it. Donald Trump has a pretty good memory, as we know --

BURNETT: Yes.

BORGER: -- and as he tells us. And, you know, I think Michael Cohen has made the case that he paid this out of his own funds, that he had to take out a loan --

BURNETT: Right.

BORGER: -- to repay this. And what Rudy Giuliani is saying is that, no, this was part of some retainer that Michael Cohen was on, and that's how this got paid.

So in a way, you know, Rudy Giuliani, if I were on Cohen's legal team, I'd be calling Rudy Giuliani today and saying, what are you talking about here? Because they have a client who's been very specific about how he repaid this. And it seems to me, like Rudy Giuliani, who by the way just joined the legal team, maybe he's not up to speed on everything that's been going on the last month or six weeks.

BURNETT: Yes.

BORGER: But these two legal teams ought to be singing from the same song book, I would think.

BURNETT: Right. And of course -- I mean, it would seem to me that you're going to have an issue with Michael Cohen being like, what do you mean, I deserve my retainer. That's separate. You owe me a $135,000 on top of it.

BORGER: Of course, you know.

BURNETT: I mean, that's a shock if that is the case.

BORGER: Of course.

BURNETT: Paul, you know, the point though when he says -- Rudy Giuliani says, even if the president was told, he wouldn't have remembered it. The only way this makes sense is if this was the sort of thing, and the sort of person, description of a person, to whom the president regularly would have heard that payments were being made to, hush payments, right?

Would that change things though? You know, if this happened all the time, maybe the fact that it happened a few days before the election was just, you know, coincidence or circumstance if it happened all the time?

P. RYAN: It wasn't coincidence or circumstance. The timing matters. Also the motive matters. We know that Stephanie Clifford, aka Stormy Daniels, she was talking to major national media outlets about going public with her story, and Rudy Giuliani said on Fox and Friends this morning, imagine if this story came out on October 15th. This was all about the election. It's obvious.

And that the real problem here is the cover-up. Donald Trump could have made this payment without violating any campaign finance laws. It's permissible for him to have spent --

BURNETT: Right.

P. RYAN: -- as much of his own money as he wanted to, to influence the election. He just had to do it transparently. Because Americans have a right to know who's spending money to influence their vote on election day.

BURNETT: Yes. And of course, who knows how all this would played out. But, you know, if no one cared about the "Access Hollywood" tape, maybe they wouldn't have cared about this and made to do all of the (INAUDIBLE). We just don't know.

Thank you all.

And next, a credibility crisis at the White House.

(BEGIN VIDEO CLIP)

SANDERS: We give the very best information that we have at the time. Again, we give the best information possible at the time.

(END VIDEO CLIP)

BURNETT: But look, she didn't know about the payment until last night, well, we all knew about it so maybe she doesn't have any information.

[19:15:00] Plus, Giuliani warning Bob Mueller tonight, don't go after Ivanka. But her husband? Disposable.

And confusion tonight, over the fate of three Americans being held by North Korea. Giuliani says they were released today. But where are they? Former CIA director Michael Hayden is my guest.

(COMMERCIAL BREAK)

BURNETT: Tonight, credibility crisis. The White House Press Secretary Sarah Sanders pressed by reporters for clarity on the hush money payment to Stormy Daniels, gave very few real answers today.

(BEGIN VIDEO CLIP)

SANDERS: I would refer you back to the statements, pretty lengthy statements, made by Giuliani. Again, I can't get into the details of the ongoing litigation. I'd refer you back to the president's outside counsel.

UNIDENTIFIED MALE: I like to follow up --

SANDERS: I'm not part of the legal team and wouldn't be part of those discussions.

(END VIDEO CLIP)

BURNETT: Of course Sanders has said the president was unaware of the hush money payment. So, was she lying or was she truly just left in the dark?

(BEGIN VIDEO CLIP)

APRIL RYAN, WHITE HOUSE CORRESPONDENT, URBAN RADIO NETWORKS: Well, you said yourself you were blindsided --

SANDERS: I actually didn't use that term.

A. RYAN: Well, I said it but you were blindsided from what you said?

SANDERS: Well, with all due respect, you actually don't know much about me in terms of what I feel and what I don't --

A. RYAN: I want to understand how this operates.

(END VIDEO CLIP) BURNETT: OK. Well, April is here. That's who you just saw as you all know if you watch this show, you know April, and she was there asking the questions of Sarah Sanders. Former senior communications adviser for the Trump campaign Jason Miller is here also, along with national affairs correspondent for the Nation, Joan Walsh.

[19:20:04] April, take us inside that room today. It was an incredible press conference, we have not seen one like it, and this is an administration in which we have never seen anything like what you deal with on a daily basis. How do you respond to --

A. RYAN: Exactly.

BURNETT: -- Sarah Sanders?

A. RYAN: Well, how do I respond? Well, basically, I listen to the entire press conference because I was the last one. I guess I got my question in by default.

But I listened to all the questions and all answers and the very beginning, the first two, started off with the truthfulness of the president and as well as Sarah, you know, started going in on Sarah about what she knew and when. There's so many different stories that are now coming out. And Rudy Giuliani, the president's attorney, has not made it any easier after last night and this morning --

BURNETT: Yes.

A. RYAN: -- just making it worse by talking too much and giving this information that the White House did not know about.

And from my sources, the White House is very upset. And I've been told about this conversation, this phone call that they had with him this morning. It was very contentious, that he didn't feel he needed to talk to the White House about it.

So, she from that podium, Sarah Huckabee Sanders herself said that she found out about it while she was watching, like all of us, Fox News last night when Rudy Giuliani was there.

BURNETT: Yes.

A. RYAN: So -- and then knowing that, from what she said, and hearing from my sources about this call this morning about how the White House wanted information, and Rudy Giuliani was like, I don't have to give you anything. You know, that's where that question came from. You were blindsided.

She acknowledged she did not know. And then to go into the personal. It was not personal. It was not personal.

What it shows me is, is that she was feeling that she was in a vise --

BURNETT: Yes.

A. RYAN: -- you know, of sorts. But she went straight to me to say something like, you know, you don't know me. In certain sectors of this nation people understand what you don't know me means. It's very street, and it leads to a fight. A physical fight.

So, I'm not there to fight. I'm there to ask questions. Been doing it for --

BURNETT: Yes.

A. RYAN: -- 21 years very well. And I've had relationships with press secretaries. I just don't seem to understand why these last two press secretaries like to point me out.

BURNETT: So Jason, you know -- what is your response? I mean, Sarah Sanders was blindsided, let's just be clear, OK? I mean, She was blind sided.

Let me just play it to make -- so that everyone understands in case you didn't hear the first part. She had no idea this was coming. Here she is.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: When did you specifically know that the president repaid Mr. Cohen for the $130,000? You personally?

SANDERS: The first awareness I had was during the interview last night.

(END VIDEO CLIP)

BURNETT: OK. April's description was accurate, Jason. What do you make of Sarah's response to her?

A. RYAN: Yes.

JASON MILLER, FORMER SENIOR COMMUNICATIONS ADVISER, TRUMP CAMPAIGN: Look, I thought Sarah did fantastic today. I mean, the fact that we're talking about Sarah not making a bunch of news, and that's actually driving the news, I don't think is necessarily a bad thing. I mean, the fact of the matter is, this White House should have had and this presidency should have had an outside counsel that was handling these types of issues a year ago. This is not the job of the White House, this is not the job of the White House press secretary.

Sarah does a fantastic job every single day --

A. RYAN: That's not true --

MILLER: -- putting forth the -- no, it is true. Sarah does a fantastic job putting forth the information --

A. RYAN: No, it's not true. I've been there for 21 years and I remember impeachment with Bill Clinton.

MILLER: April, why are you making it so personal?

A. RYAN: Yes, well, spin it the way you want to spin.

MILLER: Wow, that is -- April --

A. RYAN: Why am I taking it personally? Because she attacked me. She attacked me for asking a question, don't go there. Honey, don't go there.

(CROSSTALK)

MILLER: You're like the fifth person to jump in a --

A. RYAN: Don't try to make it about me. Bill Clinton's attorneys --

MILLER: You jumped in and interrupted me, April.

(CROSSTALK)

A. RYAN: I'm not going to let you spin it.

MILLER: April, I'm sorry that --

A. RYAN: I'm not going to let you spin it.

MILLER: -- I'm sorry that you're upset.

(CROSSTALK)

BURNETT: -- and then you get your chance to respond. April?

MILLER: OK. So the point is that --

A. RYAN: The bottom line --

MILLER: -- Sarah is the White House --

A.RYAN: -- during the Clinton years --

MILLER: -- Sarah is the White House press secretary and --

BURNETT: April first.

MILLER: So I don't get to finish?

A. RYAN: Do you not hear what she's saying? Do you not -- no, not right now --

MILLER: Because --

A. RYAN: -- let the woman speak --

MILLER: -- you weren't talking, April. You were not allowing me to say anything.

A. RYAN: So, here's what happened. So, here's what happened during the Clinton years. During the Clinton years, when they had outside attorneys and inside attorneys, the White House press shop somewhat knew what was going on because they communicated. They did not tell them everything. But they knew the course of events, what was going on.

This White House did not know. This president and Rudy Giuliani apparently have been talking. And this is some of the problem. This president -- you know, with Scaramucci, they leave the other people out. They talk amongst themselves and leave other people out.

When Anthony Scaramucci came, other people didn't know what was going on.

BURNETT: OK.

A. RYAN: So they don't --

MILLER: So, April --

A. RYAN: -- there's this bubble inside the bubble.

BURNETT: OK. Jason?

MILLER: April, the first word of outside counsel --

A. RYAN: How can I help you?

MILLER: -- is "outside". The first word of outside counsel is "outside." so now they have a structure with Mayor Giuliani --

A.RYAN: Thank you for that --

MILLER: -- Marty and Jane Raskin --

A. RYAN: -- elementary education.

MILLER: -- Post letter -- well, I'm explaining it to you because clearly you don't get it. That's why you're like the fifth or sixth reporter --

A. RYAN: This is the president --

MILLER: -- to continue asking --

A. RYAN: -- of the United States of America, there's nothing outside when you're dealing with the American people and this kind of level of investigation --

MILLER: April, this is really pretty remarkable that -- right, no.

[19:25:07] So this is -- so Sarah did a fantastic job today --

A. RYAN: Remarkable, thank you.

MILLER: -- answering the real questions --

A. RYAN: She did.

MILLER: -- that were coming at her on policy questions like --

A. RYAN: She did.

MILLER: -- whether be Iran, whether be North Korea. I'm glad that you agree with me because she did. And after five or six times of folks going to her she said, I wasn't part of the legal team, this wouldn't have been a conversation I would have been part of.

Then April, you came and followed up with basically the exact same question, trying to pin her down to say, you know, were you blindsided? She is not part of the legal team. She is part of --

A. RYAN: I'm doing my job.

MILLER: -- she's the White House press secretary --

A. RYAN: Do you have a problem with me doing my job?

MILLER: By asking the exact --

A. RYAN: Is there a problem with me asking --

MILLER -- same question for like five or six -- no, but I'm saying if she goes and gives you a pretty --

A. RYAN: She was blindsided. The facts are she was blindsided. And for her to make it a personal attack --

BURNETT: Please, hear me out because I want to jump in here. The reality is she's been perfectly willing to weigh in on this

before, right? She calls plenty of women liars, she weighs in on it again and again, she says she doesn't know about the payment.

So, you know what, if she's going to say she is -- is she has no reason to know anything now then she should have said nothing before --

A. RYAN: Right.

BURNETT: -- but that's not what happened, Joan.

JOAN WALSH, NATIONAL AFFAIRS CORRESPONDENT,, THE NATION: Right. And -- I mean, Rudy Giuliani -- I haven't talked yet, Jason so --

A. RYAN: And she said it was the arbitration before.

BURNETT: OK, let's let Joan weight in.

WALSH: Can I just say something while I'm here? Right, she has -- she'd weighed in on this before, she's obviously been wrong. Rudy Giuliani made a liar out of her and the president and Michael Cohen last night. She looked shaken. She has lost the room. I don't agree with Jason that she's done a good job.

She kept coming back to that formulation. I gave you the best information I had. It's like if I ran a deli, Erin, and I said to you, I sold you the best pastrami I had, Erin, and I'm sorry you got sick because it's a little rancid. She can't defend what she's been saying because she's either gone out and willingly peddled something, and now she's going back to, I don't have all the information so don't ask me.

BURNETT: And Joan, quickly before we go, you did have some empathy for her today?

WALSH: That was not the Sarah Sanders we know. That's not the kind of contemptuous, tough woman. She seemed chastened. She seemed a little bit off her game for sure.

BURNETT: All right. Well, everybody, you had a chance to hear different sides of the story tonight, thank you.

BURNETT: And next, team Trump signaling they're ready for battle to keep the special counsel away from Ivanka Trump but not Jared. He's disposable.

Plus, Trump's new attorney, Rudy Giuliani, he says three Americans were released from North Korea today. Why is this news coming from Giuliani? And by the way, again, Sarah Sanders has no knowledge of it. Is he even right?

(COMMERCIAL BREAK)

[19:30:17] ERIN BURNETT, CNN HOST: An ominous message from Rudy Giuliani, warning Bob Mueller to not investigate Ivanka Trump. But as for her husband, Jared? Meh, that's a different story. Listen.

(BEGIN VIDEO CLIP)

RUDY GIULIANI, PRESIDENT TRUMP'S LAWYER: Ivanka Trump, I would -- I think I would get -- get on my charger and go I'd into their offices with a lance if they go after Ivanka.

SEAN HANNITY, FOX NEWS HOST: At this point, sir, I honestly agree with you, I fear for the country. Let me go through --

GIULIANI: If they do do Ivanka, which I doubt they will, the whole country will turn on him. They're going after his daughter?

HANNITY: What about his son-in-law?

GIULIANI: I guess Jared is a fine man, you know that. But men are, you know, disposable. But a fine woman like Ivanka? Come on.

(END VIDEO CLIP)

BURNETT: I can't.

All right. Sara Murray is OUTFRONT.

Sara, look, I mean, it's incredible. Let's just be clear. Ivanka Trump, to refer to her as a daughter is -- I mean, I know she does that herself sometimes, but frankly, let's admit it, demeaning, right? She's a businessperson. She's run his projects, in Vancouver. We know the FBI interested in that.

I mean, how much interest has the special counsel shown in Jared and Ivanka?

SARA MURRAY, CNN POLITICAL CORRESPONDENT: Well, I'm sure that if you're Jared Kushner, you're taking that seriously. You might be sweating a little bit, although maybe Giuliani meant it in jest.

You know, what we know is even though Ivanka Trump hasn't really attracted much interest from the special counsel, the same cannot be said of Jared. He did go in last year and meet with investigators, the special counsel's team. We also know they had interest as well in some of his efforts to secure financing for some of his family business.

So, we know that they had been asking questions about him and some of his dealings with foreign investors, as well as other foreigners. Ivanka has not come under the same kind of scrutiny, though, at least when it comes to the special counsel.

BURNETT: So I'm curious, Sara. You know, I remember a few months ago, having lunch with Michael Cohen. And he was saying, well, you know, no one's called me, Bob Mueller hasn't called me, so I must have nothing to worry about. Is that -- you know, is that what I should be thinking? And I remember that conversation because obviously silence was not a good sign in that case.

What are the theories behind what Ivanka has not yet been approached by Bob Mueller?

MURRAY: Well, I can tell you more people are wondering, not necessarily Ivanka, but if they should be more worried if they haven't gotten a call at this point from the special counsel after seeing what happened to Michael Cohen. But I think Ivanka's in a bit of a different situation, because the interaction she was sort of involved in or nearby for that the special counsel has been interested in, we know there were a number of other aides involved. So, it's possible that Robert Mueller was able to get the information he needed elsewhere, it's possible he discovered through other witnesses or through document production that she didn't have firsthand knowledge of the things he was interested in. You know, it's also still possible her time could come.

BURNETT: All right. Thank you very much, Sarah.

And now, let's go to David Gergen, former presidential adviser, and Glen Donath, former federal prosecutor who represented President Clinton in his impeachment hearings, and Glenn also represents a client who's been before the special counsel in connection with Manafort and Gates.

David, so, what do you make of Giuliani's comments? I mean, you know, it's pretty stunning, I know he's joking, and Giuliani can make an inappropriate jokes about the gender, OK? Let's just be honest, so maybe that's all this was. Or is it something else?

DAVID GERGEN, FORMER PRESIDENTIAL ADVISER: Oh, I think it's something else plus. Listen, Rudy Giuliani is a very smart guy.

BURNETT: Yes.

GERGEN: Within the first few days of taking this job, he's disclosed that the president was lying to us, White House has been lying to us all this time about Stormy Daniels. And now, he has this gratuitous in jest perhaps, in jest probably, but certainly gratuitous line that Jared is very disposable.

It tells me two things. One is that Rudy Giuliani feels very secure in his new job. He thinks he has a complete backing of the president. And secondly, I don't think he would have taken a swipe at Jared were he not hearing things like that from Trump himself, either in phone calls or in personal meetings.

BURNETT: Glen, what do you make of this? I mean, Glen, Kushner was obviously in that Trump Tower meeting, with the Russian lawyer. There are many questions being asked about his business dealings and efforts to raise money.

Does he need to be worried here?

GLEN DONATH, REPRESENTED PRESIDENT CLINTON IN LEWINSKY AND IMPEACHMENT HEARINGS: I think he does need to be worried, Erin. I mean, going back to David's comment for a minute, it's just flabbergasting that a former U.S. attorney for the Southern District of New York would make loose comments like that. It was quite a doozy that the -- the interviews. To talk about witnesses, particularly after the special counsel made clear they're looking into signals that president Trump and others had given to witnesses to talk about who and who shouldn't be investigated --

BURNETT: Yes.

DONATH: -- is shocking.

But, yes, I think Jared has a lot to be worried about, from his conflict of interest issues with foreign governments, and trying to secure financing, to misstatements on the SF-86, his background form, to being obviously at the meeting with the Russian agent, and --

[19:35:09] BURNETT: Right.

DONATH: -- and perhaps attempts to characterize that. So for sure he would be a potential target.

BURNETT: Well, and also projects she's involved with, Vancouver under FBI scrutiny, when you look at Baku, in Azerbaijan. And "New Yorker" has done some incredible reporting. We're talking about suitcases of cash and money handovers. I mean, who knows if any of this is relevant, but she was front and center in those projects and others.

And, David, she is the president's favorite. Her siblings admit it. Here's an interview they did during the campaign.

(BEGIN VIDEO CLIP) INTERVIEWER: Who is his favorite?

DONALD TRUMP, JR., PRESIDENT TRUMP'S SON: I'm going with Ivanka.

(LAUGHTER)

I'm going with Ivanka.

(END VIDEO CLIP)

BURNETT: Does her being the favorite make her off limits, David, to anybody but the president?

GERGEN: No, of course not. No. No, nobody's above the law, man or woman. And, you know, everybody knows that. You know, and the president shouldn't be hiding behind his daughter's skirts, either.

BURNETT: Glen, do you think Ivanka will be called before the special counsel at some point or not? I mean, they want an interview with the president. They're looking at all sorts of people. Is it really possible that someone who is his favorite, who is so close to him, is truly not of interest at all?

DONATH: No, I don't think it's possible she's not of interest, Erin. I think as to why she hasn't been called yet, it's a good question. I think if she's a target or somebody who's likely to become a target, it's quite possible the special counsel doesn't want to have to grant her what we call queen for a day immunity, proffer immunity, where they wouldn't be able to use her words against her. That can create all kinds of evidentiary problems if they decide they didn't want to prosecute her.

But given -- you know, President Trump is the one who brought her into the White House and made her a witness. And she's got a lot of issues. She was at meetings where spin was discussed. She may be involved in Jared's omissions and decisions to include her, exclude certain things.

So, it is inconceivable to me she is not on the special counsel's radar in a significant way.

BURNETT: Thank you both very much.

And next, Rudy Giuliani announcing to the world that North Korea will release three Americans today. Is the president's attorney releasing classified information? By the way, where are they if they were released? Because it is now tomorrow in Korea and this is not the first time the president's long-time friend Giuliani has veered off- script. The controversial statements he's pushed in the past.

(COMMERCIAL BREAK)

[19:41:03] BURNETT: Tonight, the White House not backing Rudy Giuliani's claim that Kim Jong-un has released three American prisoners. Giuliani this morning saying the major event was going down today. (BEGIN VIDEO CLIP)

GIULIANI: We got Kim Jong-un impressed enough to be releasing three prisoners today.

(END VIDEO CLIP)

BURNETT: OK. When Sarah Sanders was asked where the three prisoners are, if this was happening, she not only could not confirm it, she also seemed to dismiss Giuliani.

(BEGIN VIDEO CLIP)

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: We can't confirm the validity of any of the reports currently out about their release. But we certainly would see this as a sign of goodwill if North Korea were to release the three Americans ahead of discussions between President Trump and Kim Jong-un.

REPORTER: In addition to being an attorney for the president, does Mr. Giuliani, Mayor Giuliani, have a wider remit to talk about things like foreign policy as he did?

SANDERS: Not that I'm aware of.

(END VIDEO CLIP)

BURNETT: OUTFRONT now, former CIA Director Michael Hayden, the author of the new book, "The Assault on Intelligence: American National Security in the Age of Lies."

General Hayden, Director Hayden, you heard Sarah Sanders, "not that I'm aware of," her answer when asked directly if Giuliani has the authority to speak about these American hostages or foreign policy in general.

Giuliani had no problem putting a major claim out about an extremely sensitive topic. He had no problem doing it.

GEN. MICHAEL HAYDEN (RET.), FORMER CIA DIRECTOR UNDER PRESIDENT BUSH: So to begin at the beginning, I think this is baked in that these three individuals are going to be released. I can't imagine any American president meeting with Kim Jong-un while three Americans are still held hostage in North Korea. And I suspect Mike Pompeo brought that up specifically when he met with the North Korean president. So, we'll put that aside. I fully expected that to happen.

BURNETT: Yes.

HAYDEN: But now you've got the mayor talking about it, number one, getting ahead of the policy process, getting ahead of the North Koreans. And frankly delivering to the North Koreans more leverage on this issue than they would otherwise have. The mayor has created expectations that the north could now use before they give us ultimately what we're going to insist on.

BURNETT: Right, because we have to get it.

HAYDEN: Right.

BURNETT: So, now, they can demand more in exchange for it, since obviously, to state the obvious, we don't get to see the three hostages today.

HAYDEN: Right.

BURNETT: So, President Trump, General, tweeted about those American prisoners before Giuliani's appearance. He wrote, quote: as everyone is aware, the past administration has long been asking for three hostages to be released from a North Korean labor camp to no avail. Stay tuned.

Now, that's part of the tweet. I'm going to share the other part in a moment, because it's very important. But just those two words, General, stay tuned. As a former director of the CIA, is it smart strategy for the president to be making this like a television tease?

HAYDEN: You know, I wouldn't. And, Erin, if you step back, let me try to make a more general point here.

There's a reason you have these processes in place. There's a reason you coordinate things. There's a reason you take great care with your language, especially when you attach it to the person of the president. And now, we've got this out here.

People like me fear, what's the right word, the sloppiness? The chaos? In the West Wing process that actually sets in motion things that we probably don't want to see. So, yes, I'm made uncomfortable when I see a tweet like that.

BURNETT: All right. So, let's look at that tweet again. In it is something that's fact actually incorrect.

HAYDEN: Right.

BURNETT: He says, the past administration has long been asking for three hostages to be released. Of course, two of the three men who are there now were detained in 2017. And obviously Donald Trump was president of the United States at that time.

What's he trying to do here by not being honest?

HAYDEN: Look, he always tries to compare and contrast himself with his predecessor.

[19:45:01] And he doesn't always use facts on which to base the distinction between the two.

So, as you correctly point out, two of the three were arrested in North Korea while he was president. If you run the clock back a little bit, Erin, the last time we had prisoners released from North Korea, it was because Jim Clapper, the former director of national intelligence, went to Pyongyang in the Obama administration to negotiate their release.

You know, there's an issue here. And again, it's the underlying issue. North Korea is a really difficult problem. It's a wicked problem today not because his predecessors were stupid or unpatriotic. And I'm pretty certain it's going to be a wicked problem after this president leaves office too.

I just wouldn't make these kinds of comparisons.

BURNETT: All right. Well, General Hayden, obviously as we talk here about honesty and the role of specificity, honesty in tweets, goes right to the heart of your book, which is out now, "The Assault on Intelligence: American National Security in an Age of Lies" by General Hayden.

Director Hayden, thanks so much as always, sir, for being with us.

HAYDEN: Thank you.

BURNETT: And next, Rudy Giuliani's history of pushing conspiracy theories, from claims of voter fraud to Hillary Clinton hiding a serious illness.

(BEGIN VIDEO CLIP)

GIULIANI: I've seen her lifted onto airplanes, and I don't know what's wrong with her.

(END VIDEO CLIP)

BURNETT: And is it Stine or Steen? Jeanne Moos on Rod, the man with the name nobody can seem to get right.

(COMMERCIAL BREAK)

[19:50:17] BURNETT: Rudy's revelation. The former New York City mayor has only been President Trump's lawyer formally for two weeks, although, obviously, their relationship goes well beyond that. And now, his media blitz, his 24 hours of interviews, are blindsiding many in the White House, according to our Gloria Borger, making them angry.

But you know what? Maybe they should have known it was coming.

Alex Marquardt is OUTFRONT.

(BEGIN VIDEOTAPE)

GIULIANI: It's time to make America one again, one America!

ALEXANDER MARQUARDT, CNN SENIOR NATIONAL CORRESPONDENT (voice-over): It was a performance that solidified Rudy Guiliani's place among the most fervent Trump surrogates.

GIULIANI: Who would trust Hillary Clinton to protect them? I wouldn't. MARQUARDT: The former New York City mayor at the 2016 Republican

national convention blasting Hillary and stoking fears about ISIS terrorism.

GIULIANI: Operatives who are terrorists who are going to come to Western Europe and come here and kill us.

MARQUARDT: Just one installment in a year's long series of bombastic, conspiratorial and often downright false statements. A month later, in a speech in which he talked about terrorist attacks on 9/11, which happened during the Bush administration years, he said this.

GIULIANI: By the way, under those eight years before Obama came along, we didn't have any successful radical Islamic terrorist attack in the United States.

MARQUARDT: A month after that, fuelling the conspiracy theory that Hillary Clinton was hiding a serious illness.

GIULIANI: I have eight times online since January in which she's had massive coughing fits in which she couldn't complete her speech. I've seen her lifted on to airplanes and I don't know what's wrong with her.

MARQUARDT: Clinton was a frequent target during the 2016 campaign.

GIULIANI: This is the most anti-police, anti-law enforcement convention I've ever seen in my whole life.

Hillary Clinton didn't want uniform police officers on the convention floor.

MARQUARDT: A claim the Philadelphia police department shot down.

Giuliani has never been known to shy from sensitive issues, like race.

GIULIANI: When you say black lives matter, that's inherently racist, black lives matter, white lives matter, Asian's lives matter, Hispanic lives matter. That's anti-American and it's racist.

MARQUARDT: In lockstep with Trump's talking points, Giuliani ramped up accusations of vote rigging.

GIULIANI: If you want me to tell you that I think the election of Philadelphia and Chicago is going to be fair? I would have to be a moron to say that.

MARQUARDT: And that the campaign's lowest point, he rushed to the candidate's defense after the infamous "Access Hollywood" tape.

GIULIANI: This is talk. Gosh almighty, you know, he hasn't sinned throw the first stone here.

(END VIDEOTAPE)

MARQUARDT: So after all that support that Giuliani showed Trump on the campaign trail, he was thought to be in the running for a number of cabinet positions, including attorney general, secretary of homeland security, or secretary of state. He says he got two offers, but the only one that he wanted was secretary of state, which, of course, then went to Rex Tillerson. Now, in this role as Trump's lawyer, he could hardly be closer to the president, but as we've seen, that, of course, raises its own set of risks.

BURNETT: Certainly does. Alex, thank you. Pretty interesting to see all those, especially that 9/11 one.

And next, he is the guy overseeing the Mueller probe. But what's his name?

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Thank you, Mr. Rosenstein.

UNIDENTIFIED MALE: Rod Rosenstein.

UNIDENTIFIED FEMALE: Deputy Attorney General Rosenstein. Stine.

(END VIDEO CLIP)

BURNETT: Jeanne Moss is next.

(COMMERCIAL BREAK)

[19:57:56] BURNETT: Tonight, Rod Rosenstein, the guy in charge of the Bob Mueller investigation answers the burning question, is it stine or steen?

Here's Jeanne Moos.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN CORRESPONDENT: The cost between a steen and a stine is Rod Rosen-whatever.

UNIDENTIFIED MALE: Remember Rosenstein.

UNIDENTIFIED FEMALE: Thank you, Mr. Rosenstein.

UNIDENTIFIED MALE: Rod Rosenstein.

UNIDENTIFIED FEMALE: Deputy Attorney General Rosenstein. Stine.

MOOS: No wonder someone finally popped the question.

UNIDENTIFIED MALE: How do you pronounce your last name?

ROD ROSENSTEIN, DEPUTY ATTORNEY GENERAL: There is no right answer to that question.

MOOS: No right answer?

UNIDENTIFIED MALE: He's alive. MOOS: Take it from this guy's creator.

UNIDENTIFIED MALE: Frankenstein.

ROSENSTEIN: My father pronounces it stein.

Good morning, I'm Rod Rosenstein.

But I actually have relatives that pronounce it steen. So, I'll answer to either one.

MOOS: But will he answer to this guy?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Rod Rosenstein.

REP. JERRY NADLER (D), NEW YORK: Welcome to the House Judiciary Committee, Mr. Rosenstein.

UNIDENTIFIED MALE: Mr. Rod Rosenstein.

MOOS: Please, I don't have much sympathy for all those steens and steins out there, not with a last name like moos.

In German, the second vowel usually takes precedent, so the ei in Rosenstein is pronounced stein. But then this guy's name should with Weiner.

UNIDENTIFIED FEMALE: Anthony Weiner.

MOOS: Weiner is an exception to the rule.

Sometimes neither choice is great. You want to be a Weiner or a Weiner.

There was some whining about the special prosecutor. Does anyone else read the name Robert Mueller and pronounce it like Ferris Bueller.

UNIDENTIFIED MALE: Bueller, Ferris Bueller.

MOOS: But this is Mueller, Robert Mueller, though he sometimes gets the Ferris Bueller treatment.

UNIDENTIFIED MALE: Mr. Mueller.

UNIDENTIFIED MALE: Mueller.

UNIDENTIFIED MALE: Did you talk with Robert Mueller about his investigation?

UNIDENTIFIED MALE: Mueller.

UNIDENTIFIED MALE: Did you consult with Mr. Mueller?

MOOS: Sometimes it takes a stein to know one, Dianne Feinstein.

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: Yesterday, Mr. Rosenstein. UNIDENTIFIED MALE: Mr. Rosenstein, welcome.

ROSENSTEIN: Thank you.

UNIDENTIFIED MALE: Mr. Rosenstein, thank you. I remember.

ROSENSTEIN: It's like Feinstein.

MOOS: Feinsteen, it's creating a monster.

UNIDENTIFIED MALE: Dr. Frankenstein.

MOOS: Jeanine Moos, CNN --

UNIDENTIFIED MALE: Frankenstein.

MOOS: -- New York.

UNIDENTIFIED MALE: You're putting me on.

(END VIDEOTAPE)

BURNETT: And thank you so much for joining us. We'll see you back here tomorrow night.

"AC360" with Anderson begins now.