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ANDERSON COOPER 360 DEGREES

Nuclear Cover-Up; Surfing Drugs; DSK Case in Trouble; Casey Anthony Defense Rests; Haven for Youth on Chicago's South Side

Aired June 30, 2011 - 23:00   ET

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


(COMMERCIAL BREAK)

SANJAY GUPTA, CNN ANCHOR: Dr. Sanjay Gupta tonight, sitting in for Anderson.

Tonight, we're going to bring you a view of Casey Anthony you have never seen before; 360 has obtained video of Casey when she was a little girl, 5 years old. It's a birthday Caylee would never reach.

And as Casey's defense wraps up, we'll wrap up the dramatic final day of testimony and dig deeper on two questions everybody seems to have been asking: would she testify and then, why didn't she?

We begin, though, "Keeping Them Honest" with new and troubling developments in a disaster both Anderson and I saw up close, the nuclear catastrophe in Fukushima Japan. Today's headline: the government recommending more evacuations, hard to believe, 113 additional households in four districts in the city of Date. That's far beyond the mandatory exclusion zone set up for 20 kilometers around the crippled reactors.

These are newly designated hot spots.

Now, separately, according to a citizens group and a French NGO, trace amounts of radioisotopes have now been found elsewhere, in children, as far as 24 miles beyond that mandatory evacuation zone. Additionally, this French NGO says it's been long warning that the allowable levels of radiation exposure set up by the government is simply too lax.

And that really frames our hypothesis for tonight. This is something Anderson and I and a lot of outside experts noticed almost from day one. Bad news was consistently downplayed and delayed for days, sometimes weeks, by the Japanese government or the plant operator, TEPCO.

You will recall, on the 11th of March, tsunami waves crippled these cooling plants at the Fukushima Daiichi complex. That set off partial meltdowns and explosions in three reactors and exposing spent fuel in a fourth. Two weeks later, March 25th, Greenpeace scientists said they collected enough data to judge this disaster a level seven. That's the worst kind possible. Other experts agreed.

But it took until April 12 for the Japanese government to call the partial meltdown of three nuclear reactors a level seven disaster. Now, as for people living nearby, the Japanese government waited until April 11th to widen its danger zone beyond 20 kilometers. That's nearly a month after the U.S. government recommended Americans living inside 80 kilometers of the plant either leave or stay indoors. And then there's this.

(BEGIN VIDEO CLIP)

STEVEN CHU, U.S. ENERGY SECRETARY: We think there is a partial meltdown, but -- and as you correctly noted, that doesn't necessarily mean the containment vessel will fail.

(END VIDEO CLIP)

GUPTA: Energy Secretary Steven Chu testifying before Congress on March 16th. On April 2nd, he said that based on high radiation levels, 70 percent of the number one reactor core had been damaged. Secretary Chu, by the way, is a Nobel laureate physicist.

Yet, the next day after this, Japan's Nuclear Safety Agency said the core damage was only three percent. And it would take until June 6th before Japanese officials would reveal that three reactors at the Fukushima Daiichi plant did in fact experience full meltdowns.

A day later, the government admitted that the plant spewed out more than twice as much radiation as originally estimated.

It's a lot here and credit for putting together this frankly troubling timeline goes to my colleague in Tokyo, Kyung Lah. I spoke with her earlier about all of this, along with nuclear industry veteran and former plant operator Michael Friedlander.

(BEGIN VIDEOTAPE)

GUPTA: You know, Kyung, time and time again, agencies and organizations outside of Japan have warned of these heightened dangers, and then weeks, if not months, later, TEPCO or the Japanese government finally admit the truth.

What is your sense about this? Are they purposely stalling? Is it inefficiency, or are they just being inept?

KYUNG LAH, CNN CORRESPONDENT: Well, maybe a little bit of both, Sanjay.

In the beginning a lot of people say, ok, perhaps they were overwhelmed, that they weren't properly prepared, as the IAEA suggested, for such a disaster and that there was so much going on. But that pass has certainly gone by at this point.

Now, what a lot of people in the public are feeling is that it does appear that they're either stalling or not being able to face reality. For example, I mean, if you look at the timeline that you just laid out, and then you look at what's ahead, the fact that there is this cold shutdown that the government and TEPCO says will happen by the end of the year, most outside experts say that's probably not going to happen.

GUPTA: Right.

If you break it down and look at all the various issues surrounding this, Michael, what concerns you the most going forward at this point?

MICHAEL FRIEDLANDER, FORMER SENIOR NUCLEAR POWER PLANT OPERATOR: Sanjay, actually, there are two things that trouble me.

The first, of course -- when we've talked about this before -- is the snail's pace of progress. We have seen over the course of the last few weeks that they have been able to make some pretty important headway in terms of cooling the spent fuel pools and stabilizing the spent fuel pools.

But, functionally, the reactors themselves, Reactors One, Two and Three, they are in almost the same configuration that they were in, in late March.

And quite honestly, another earthquake, a tsunami, a plant mishap such as a fire or an industrial accident could certainly set us back all the way back to where we were early in March and potentially cause the situation where we have another significant release of radiation to the environment.

And you have to remember, too, as well, in this region of the world, we have now entered the typhoon season. And these plants are located on the East Coast of Japan, so they are subject to the forces of a typhoon.

The second issue that worries me, TEPCO had their annual general shareholders meeting on Tuesday. All 17 of the directors were re- elected to their position. The chairman was re-elected to his position. And so it seems to be a sort of a situation of status quo, keep continuing doing what we have been doing for some time.

GUPTA: Yes. It's interesting, both at the industrial level, as well as the government level. And I want to talk to you about that in a second.

But, Kyung, one of the things that I was trying to figure out even when I was there was, do people believe they were exposed to nuclear risk longer simply because the government and TEPCO were not forthcoming? Did they put people at risk?

LAH: Absolutely. Absolutely.

If you talk to anyone who lived in that immediate evacuation zone or just outside the evacuation zone, where there are still people living in their houses, they absolutely feel that was the case and that it is still happening.

There's a group loosely known as the Fukushima mothers. And they believe that the government is continuing to put public health on the back burner. Case in point, the children of Fukushima City, there are about 34,000 of them, this September will start wearing dosimeters. So they will in effect become little mobile radiation detectors and monitors throughout the Fukushima region.

And so what these mothers are saying is, isn't this operating in reverse? Shouldn't we act out of an abundance of caution and then try to collect the data to support that? And it appears still, according to many of the people who live up there that the government is acting in reverse.

GUPTA: Yes. I got to say, I mean if those were my children, I certainly would -- would say the same thing.

I mean, you know, Michael, at the government level -- and a lot of people may know this, but Japanese Prime Minister Kan barely survived a no-confidence a few weeks ago, after saying he'd resign when the nuclear situation was under control.

Now, you believe that that -- that whole situation is affecting how his government is disseminating information. How so?

FRIEDLANDER: Well, you know, I'm not an insider. But from the outside -- I'm sort of taking a look at things as they have been progressing and where we see them going. You certainly have to consider the possibility, as you suggested, that the political system is affecting the way the accident and the way the recovery efforts are being managed.

Dragging things out, the DPJ gets to stay in power longer, and it's certainly a situation that, the longer it drags out, memories begin to fade, and then, after a period of time, of course, the DPJ can take credit for navigating the country through some very difficult times.

GUPTA: Kyung, I wonder if you had anything to say about that. Is there, in your opinion, any public trust left in the Japanese government or TEPCO over this whole issue?

LAH: As far as how people feel about the government and TEPCO, I can tell you that there is very, very little confidence. Polls suggest -- a recent poll suggested only 23 percent of the people approve of the government. And the approval ratings for TEPCO are even lower. They're in the gutter.

On a recent Saturday, there were some 20,000 people who marched through the streets of Tokyo. That is an extraordinary number in Japan. That is something you never see.

GUPTA: Kyung Lah, Michael Friedlander, thanks so much.

(END VIDEOTAPE)

GUPTA: And let us know what you think as well. We're on Facebook. You can also follow me on Twitter @SanjayGuptaCNN. I will be tweeting tonight.

Just ahead, though: the Casey Anthony trial and what the alleged mistress says she heard, what Krystal Holloway says Casey's dad told her. Could this be enough to establish reasonable doubt as the jury gets ready to hear these closing arguments? Also, exclusive video only here on 360 of what Casey Anthony said when she was a little girl.

Next up, though, Drew Griffin "Keeping Them Honest," tracking down doctors who prescribe powerful mind-altering drugs on the Internet to patients they have never even met.

First, though, let's check in with Isha Sesay.

ISHA SESAY, CNN INTERNATIONAL CORRESPONDENT: Sanjay, it looks like a movie chase scene, but it's not -- real drug smugglers making a real run for the real border. Only, in this case, the border happens to be a river.

We'll show you what happens next -- that and much more when 360 continues.

(COMMERCIAL BREAK)

GUPTA: As a doctor and a father, this next story really hits home for me, how easy it's become to order dangerous drugs over the Internet without a prescription.

Drew Griffin has been doing some groundbreaking reporting on the subject for some time. He's uncovered dozens of these so-called rogue online pharmacies, all of which have been advertising on Google.

Now, sources tell us Google is setting aside a half-a-billion dollars to pay for what would be one of the largest such government fines ever, fines for accepting online pharmacy ads that break American law.

Here's Drew now "Keeping Them Honest" with the latest.

(BEGIN VIDEOTAPE)

DREW GRIFFIN, CNN INVESTIGATIVE CORRESPONDENT (voice-over): It was a simple transaction. A woman addicted to painkillers in Washington State goes online, Googles her drug of choice, and finds the dealer to satisfy her habit.

UNIDENTIFIED FEMALE: I just typed in Soma, and all these Web sites popped up. And I just picked one.

GRIFFIN: The addictive muscle relaxant arrives, no questions asked, with a prescription signed by a doctor she never met, this doctor, who lives on Long Island, New York, thousands of miles away.

(on camera): Did you ever see this patient, Nancy Fitzpatrick (ph)? Can you let me know how these prescriptions are filled, sir?

(voice-over): Dr. Kareem Tannous (ph) left without so much as saying a word.

(on camera): Can you help me understand how this works, sir?

(voice-over): As CNN reported nearly three years ago, we know how this works. And it's helped to fuel a spike in prescription drug abuse that medical experts say has spun out of control. We went online and bought one of America's most abused drugs. It showed up, left on a doorstep, the very next day.

(on camera): And this is what is inside. It's Prozac in its generic form prescribed to me by a doctor I have never heard of somewhere in Tennessee.

(voice-over): What's happened in the last three years since we bought those drugs? Not much. Dr. Tannous still has a license to practice medicine. And online pharmacies like this one are still easily accessed and eager to sell their drugs.

But that could be about to change. Sources tell CNN the U.S. Department of Justice is zeroing in on the one mega search engine that has repeatedly been warned that it is facilitating all these drug addictions, Google.

JOSEPH CALIFANO, CHAIRMAN AND PRESIDENT, NATIONAL CENTER ON ADDICTION AND SUBSTANCE ABUSE: We noticed that these were drugs that could be acquired without a prescription. Indeed, the advertisement, when you would bang in on Google, you would bang in "Vicodin without a prescription," "Oxycontin without a prescription," and up would come these sites.

GRIFFIN: Joseph Califano is now 80 years old, a true Washington insider. He was a former aide to Lyndon Johnson, Cabinet secretary under Jimmy Carter. And when he left government, he founded a public interest think tank devoted to fighting drug abuse.

And in 2008, the same year we were buying our drugs online, the same year the woman south of Seattle was buying hers online, Joseph Califano was writing to Google, telling Google's then chairman and current executive chairman, Eric Schmidt, that Google was filled with prominent displays of ads for rogue pharmacies, suggesting "that Google is profiting from advertisements for illegal sales of controlled prescription drugs online."

Google says it stopped the practice last year and it's filed lawsuits against some of the online drug advertisers. But Califano says these sites appear and then disappear, often overnight.

CALIFANO: I wrote to Mr. Schmidt and asked him, please, you have to look at what's going on. Why are we having such an explosion in prescription drug abuse among teenagers and kids? Well, where do they get them?

GRIFFIN: Google, he said, never responded. And Google still isn't responding, telling CNN through a spokesperson, "As this is a legal matter, we're not commenting on it."

Now CNN has confirmed Google is bracing for what could be the biggest fine in U.S. government history for allowing the illegal flow of pharmaceuticals through its search engine. In an SEC filing, the company disclosed it was setting aside a half-billion dollars to potentially settle a Department of Justice criminal investigation that involved -- quote -- "certain advertisers."

Sources confirmed to CNN those advertisers were rogue online pharmacies that were paying Google for its services. The real question Califano is asking: why Google couldn't have done something sooner.

CALIFANO: To me, it's -- it's an example of putting profits over people. That's what we're talking about here. And it's bad, really bad, because it's kids.

(END VIDEOTAPE)

GUPTA: Fascinating report, Drew.

Let me ask you a couple of questions. First of all, why go after Google specifically? I mean they're not selling the actual drugs. That's being done by these -- these rogue pharmacies.

GRIFFIN: That's true, but Google is getting money from this business in terms of the advertisements.

Secondly Sanjay, Google has been warned about this by many different agencies and others. And they have been able to watch our reports, but I think what you're seeing here is a real acknowledgement that, you know what? Law enforcement is pretty much helpless to stop this without industry cooperation.

There's just too many of these pharmacies. They're too hard to prosecute on an individual basis. And unless Google and other Internet providers police themselves, I don't think police stand a chance.

GUPTA: Drew, I wanted to share something interesting with you as well.

There was a study done by Mass General Hospital and USC, California. It showed that states, who had the fastest expansion of their high- speed Internet systems back in the early 2000s also had the highest rate of hospital admissions for drug abuse. I found this really interesting.

Many people say that that suggests these online pharmacies could be a big factor in the prescription drug problem overall.

Indulge me for one second, Drew. I want to show you some numbers as to how big a problem we're talking about here.

According to the National Institute on Drug Abuse, there are about seven million people using prescription drugs for non-medical reasons. That was in 2009. That's about three percent of the population. Nearly one in 12 high school seniors report non-medical use of Vicodin. One in 20 say they used Oxycontin.

Now, what's interesting, Drew is that 59 percent of those high school seniors also say they got the drugs from a friend or a relative, which brings up another question. I mean as you have been pointing out in your reports, it's so easy to buy these drugs online.

But if the pharmacies start to shut down, can't people get them from -- from their family or friends pretty easily?

GRIFFIN: They certainly will. But I think it's the proliferation of the ease of getting these drugs. And even people who want these drugs, let's say a doctor prescribes them, but the prescription runs out. They're addicted. They want to keep it going, so they turn to the Internet to keep that going.

And they bring those drugs into their homes for their children to pilfer through or their nephews and nieces to get. So, I think it will slow the problem. It will not end the problem.

Look, prescription drug abuse in this country is huge and growing. But it's also very, very accessible online.

GUPTA: And the numbers still just staggering. I know you know these, but 36 million people bought these drugs from online pharmacies, and many of them for a legitimate reason. They're buying quality drugs at a cheaper price because they were just so expensive.

I did a little reporting on this as well for "60 Minutes" and found that many of these medicines being sold by online pharmacies are actually counterfeit drugs made in illicit labs overseas. So, you can't even be sure the drugs sold by these online pharmacies are safe to take.

One example, quickly, Drew, is Pfizer says that counterfeit versions of their drugs have made it to pharmacies and hospitals in at least 46 different countries, including England, including Canada, and right here in the United States as well.

So it's not just a question of easy access to these online pharmacies. It's also a health and safety issue as well.

GRIFFIN: Absolutely right. But you know what? A couple of years ago, the FDA tried that rout, warning people about buying these drugs online. It didn't -- it didn't really stop; that message did not get across. So people are still trying to access these online pharmacies, even with the risks, Sanjay.

GUPTA: I know. And my parents do it as well, in part because of these -- these high costs.

Again, a fascinating report; Drew Griffin, many thanks.

GRIFFIN: Thanks.

GUPTA: And coming up, breaking news: new developments that could blow the sexual assault case against the French diplomat Dominique Strauss- Kahn to pieces. We'll tell you about it.

Plus: The defense rests in the Casey Anthony trial after a dramatic day of testimony -- what George Anthony's alleged mistress said on the stand today. Plus, an exclusive look at home video that 360 has just obtained. It shows Casey Anthony as a child.

(COMMERCIAL BREAK)

GUPTA: Breaking news tonight: the sexual assault case against former IMF head Dominique Strauss-Kahn, well, it may be in real trouble. A defense source has told CNN there are serious issues with the credibility of the housekeeper who claims that he attacked her in his Manhattan hotel suite.

On the phone joining us; Susan Candiotti, and senior legal analyst Jeffrey Toobin who has just spoken with a member of the DSK defense team.

Susan, let me start with you.

You have been talking to your sources. What is the nature of these credibility issues?

SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: Well, our sources are being very protective about what they want to say about this.

But suffice it to say that information apparently that she has been providing to police is very troubling, so much so that reportedly -- and this is according to "The New York Times" -- that prosecutors reached out to members of the DSK defense team today and had a meeting with them to discuss some of these credibility issues that my sources tell me currently exist with the hotel maid at this point.

This is a woman that we all have to remember that the police investigators, the NYPD, have repeatedly said was extremely credible, in their view --

(CROSSTALK)

GUPTA: Right.

CANDIOTTI: -- that they got forensic evidence in the case from her and that they were standing by what this witness had to say.

But of course, as these investigations go on by both sides, both police investigators and members of the defense team, they look into various aspects of this case and evidently, some information has turned up that is troubling.

Now specifically, "The New York Times" is reporting that, among other things, that a day before this woman talked with law enforcement officials, that she had had a conversation with a man who had been jailed in which she allegedly discussed the possible benefits, as "The New York Times" put it, of pursuing charges against him, and that this conversation was recorded.

Likewise, "The Times" is also reporting that this woman, the maid, the -- who made the allegations, also there were problems with the asylum application that she had made before she came to this country from Africa, in which things didn't quite match up.

And suffice it to say that when they go into court tomorrow in a hastily arranged court hearing, a source close to the defense team tells me that they will be asking the judge to modify the bail that has already been in place for Dominique Strauss-Kahn, asking -- a motion, rather, to modify it.

Remember, he's already posted $1 million cash bond, as well as a $5 million bond, in order to be put under house arrest and be released from Riker's jail. So, we shall see what will happen in court tomorrow.

(CROSSTALK)

GUPTA: Right.

CANDIOTTI: But I'm told it should be something.

GUPTA: So this is -- I mean this is happening. This is ongoing right now -- again breaking news about the DSK case.

Jeffrey, originally reported in "The Times," but -- but you've talked to the defense team as well tonight. What have you heard?

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST (via telephone): Well, this is just an extraordinary, extraordinary development, considering that this case was brought with such great fanfare by the Manhattan district attorney, and they very loudly trumpeted the credibility of the accuser here. And the credibility appears -- and I -- and I hasten to say appears -- to have collapsed.

What makes it even more extraordinary is that the evidence apparently shows DNA evidence of a sexual encounter between Dominique Strauss- Kahn and the woman who's the maid. Yet, even with DNA evidence, the prosecution is considering dropping the case. That shows how bad her credibility may be, that, even with DNA evidence, they may not be able to bring this case. It's a shocking, shocking development.

GUPTA: So I mean, Jeffrey, does that essentially mean that I mean, that they're not saying that a sexual encounter did not happen, but this is just all about the credibility of this maid?

TOOBIN: No. This is what -- this is the thing that is so incredible, is that, obviously, if there is DNA evidence involving semen, a sexual encounter did take place.

But even with the DNA evidence, because the credibility of the -- the -- the accuser, the victim, is still at issue, they may not be able to bring the case. Her credibility may be so bad that, even with DNA evidence, they still may not be able to bring the case.

GUPTA: Susan, I know this is all transpiring even as we're talking. But have you heard at all about what this means, more immediately, for -- for Strauss-Kahn? I mean could he possibly be released from house arrest as a result?

I don't know if -- I think Susan -- Jeffrey?

(CROSSTALK)

TOOBIN: Sanjay, I can answer that.

GUPTA: Go ahead, yes.

TOOBIN: The answer is, yes, that's what -- that's what tomorrow's hearing is about.

They -- he is out on bail, but he's restricted to house arrest. They may seek to have him released on his own recognizance, where he can go wherever he wants, as long as he doesn't leave the country. That's a major, major change.

GUPTA: Well, so the overall impact, I mean, how -- how quickly could this all possibly transpire? How fast? We're talking -- tonight is Thursday. How quickly does this all potentially happen?

TOOBIN: Well, certainly, the bail issue will be dealt with tomorrow. As for whether the case will be dismissed altogether or there might be lesser charges, I suspect that will take longer.

GUPTA: All right. Jeffrey thanks so much; Susan Candiotti as well.

We will keep on top of it.

Just ahead, though, the Casey Anthony defense rested today. Her lawyers never did put her on the stand. But you're going to see and hear her tonight right here in exclusive new video that 360 has obtained.

First, though, Isha is back with a "360 News & Business Bulletin."

SESAY: Sanjay, the FBI is trying to figure out if a man who stowed away on a New York to L.A. flight last week just wanted a free ride or was up to no good. He got through security and on the plane without a proper boarding pass. No one noticed until passengers complained about his body odor. He was detained and released but was arrested yesterday when he tried to board a Delta flight from L.A. to Atlanta without a valid boarding pass.

After being criticized by the President yesterday, there will be no vacation for the U.S. Senate next week. They'll be off on the Fourth, but then it's straight back to work on the bill to raise the debt ceiling and spending cuts Republicans are demanding.

Army General David Petraeus will be the next director of the CIA. The Senate vote to confirm him was unanimous. Petraeus now commands coalition forces in Afghanistan. He will succeed Leon Panetta, the new secretary of defense.

The man Panetta will replace, Robert Gates, got a presidential send- off today. He is the only secretary of defense who has served a Republican, George W. Bush, and a Democrat, Barack Obama. And the newest royal sensations Will and Kate -- she is, of course, now Catherine the Duchess of Cambridge -- they are in Canada tonight. It is their first official trip abroad. They'll be there for nine days with stops across the country. But they won't be alone, Sanjay. More than 1,300 journalists are following their every move -- 1,300. I mean what's there to say?

GUPTA: They're just trying to have a romantic getaway. They're newly married and 1,300 of us in the media following them around. Are you going to be one of them, by the way?

SESAY: No. I'll be here to bug you instead.

GUPTA: Never a bother Isha. Isha thanks so much.

Up next, the Casey Anthony defense rests without putting her on the stand. Is that going to help her or hurt her when the jury deliberates?

But the same jury incidentally did hear from the woman who claims she had an affair with Casey's father and that he told that her little Caylee died in an accident that spiraled out of control.

And AC 360 has exclusive home video of Casey Anthony. You're going to see a completely different side of the woman accused of killing her 2- year-old daughter.

(COMMERCIAL BREAK)

GUPTA: In "Crime & Punishment" today, what can you say? A huge day in the Casey Anthony trial; the defense rested its case today, and Casey did not take the stand. Among those final witnesses, though, Casey's mother, father, brother. The defense's end game included testimony about how the Anthony's family pets were buried.

And earlier in the day, George Anthony's alleged mistress was on the stand, testifying about their affair, an affair that George denies they had, and what she says George told her about Caylee's death.

We have the latest from today's testimony in just a moment.

First, though, we want to show you something else: a 360 exclusive home video that we just obtained of Casey Anthony as a child herself.

This video is from a classmate's birthday party that Casey went to in Orlando in 1992. Casey would have been almost six years old. Here you can see Cindy Anthony actually dropping her off. And here you can see Casey. She's the one with the braid in her hair right over there.

At the party all the kids wished their friends a happy birthday on camera. Here's Casey.

(BEGIN VIDEO CLIP)

CASEY ANTHONY, ON TRIAL FOR MURDER: Happy birthday. My name's Casey.

UNIDENTIFIED FEMALE: Wait a minute, Casey. I didn't get to you.

CASEY ANTHONY: Happy birthday. My name's Casey.

(END VIDEO CLIP)

GUPTA: It's a rare look at Casey Anthony as a child. That's home video obtained exclusively by AC 360.

Now, all these years later, Casey Anthony's life is on the line, in her own murder trial; a trial that is almost over. Martin Savidge was in the courtroom today when the defense rested after some pretty dramatic testimony. He has the latest.

(BEGIN VIDEOTAPE)

MARTIN SAVIDGE, CNN CORRESPONDENT (voice-over): After three years of investigation and 32 days of testimony, it came down to five words.

JOSE BAEZ, CASEY ANTHONY'S ATTORNEY: Your honor, the defense rests.

SAVIDGE: For attorney Jose Baez and his legal team, no more witnesses, no more evidence, and above all, no testimony from 25-year- old Casey Anthony.

JUDGE BELVIN PERRY, PRESIDING OVER CASEY ANTHONY TRIAL: And it is your decision not to testify?

CASEY ANTHONY: Yes, sir.

PERRY: Have you had ample time to discuss this matter with your attorneys; that is, the pros and cons of testifying or not testifying?

CASEY ANTHONY: Yes, sir.

PERRY: And has anyone used any force or pressure in making you arrive at that decision?

CASEY ANTHONY: No, sir.

PERRY: OK. And that decision is your decision freely and voluntarily?

CASEY ANTHONY: Yes, sir.

SAVIDGE: Instead it was another woman who the defense hoped would support their claim that 2-year-old Caylee Anthony wasn't murdered but died, the result of an accident, covered up by Casey and her father.

BAEZ: The defense calls Krystal Holloway.

SAVIDGE: Holloway, the defense claims, had unique access to the truth through Casey's dad.

BAEZ: Did you develop a relationship with Mr. Anthony?

KRYSTAL HOLLOWAY, GEORGE ANTHONY'S ALLEGED MISTRESS: Yes, sir, I did. BAEZ: And was this an intimate relationship?

HOLLOWAY: Yes.

BAEZ: And did Mr. Anthony go to your home or your apartment?

HOLLOWAY: It was my home. And yes, he did.

BAEZ: About how many times did he go to your house?

HOLLOWAY: Maybe 12.

SAVIDGE: And it was on one night in her home she said George Anthony broke down.

HOLLOWAY: He was sitting on my couch. And I was sitting on the floor. And he had told me -- he had said it was an accident that snowballed out of control. But I was in shock. And by the time I looked up, his eyes were filled with tears. And I didn't elaborate. I didn't ask him anything further.

BAEZ: Did -- was this before Caylee was found?

HOLLOWAY: Yes, sir.

SAVIDGE: On cross-examination, prosecution attorney Jeff Ashton said Holloway told police she never had an affair with Anthony, suggesting she manufactured the story to sell to the media.

JEFF ASHTON, PROSECUTOR: And the story is much, much better if you're actually having an affair with George, right? It's much more sensational.

HOLLOWAY: I did have an affair with George.

ASHTON: But you would agree that story is much sexier if you're actually having an affair with George than if you're just a friend.

HOLLOWAY: That's not true.

SAVIDGE: Ashton also got Holloway to admit that, in his breakdown, George Anthony wasn't confessing his own role in his granddaughter's death.

ASHTON: So they specifically asked you whether he said he was told about it or it was something that you believed.

UNIDENTIFIED MALE: (INAUDIBLE)

PERRY: Overruled.

ASHTON: And you told them he didn't say that. He said like he knew. So George made it clear to you that he did not have first-hand knowledge of what happened to his granddaughter. That was the context of what he said, wasn't it?

BAEZ: Objection. The statement speaks for itself. Speaks for itself.

PERRY: Overruled.

HOLLOWAY: Correct.

SAVIDGE: Then the case took another strange turn, as Jose Baez began asking George Anthony about a number of dead family pets.

BAEZ: Did you have a dog named Mandy in Ohio, sir?

SAVIDGE: The focus was not on how the animals died but how George would bury them: often wrapped in plastic with tape.

BAEZ: When you found out that your granddaughter was found and with a blanket and with a plastic bag and with duct tape, did you tell law enforcement at any time over the last three years that that is the way you used to bury your pets?

SAVIDGE: But with Cindy Anthony on the stand, the prosecution pointed out Casey also knew the ritual.

LINDA DRANE-BURDICK, PROSECUTOR: Definitely by the time she's a senior in high school, she was aware of the burial and the method of burial in the yard?

CINDY ANTHONY, MOTHER OF CASEY ANTHONY: Yes, ma'am.

SAVIDGE: Cindy Anthony was also the focus of legal arguments today. Casey's mom has said that she was the one on the home computer searching information on chloroform. The prosecution wants to introduce employment records they say show Cindy was at work that day.

The day ended with jurors reading the suicide note George Anthony wrote when he attempted to kill himself six weeks after Caylee's body was found. In it, instead of confessing to her death, a broken- hearted grandfather wonders who could have done such a thing and in the close writes, "Caylee, here I come."

Martin Savidge, CNN, Orlando.

(END VIDEOTAPE)

GUPTA: We're just days away from now the jury getting this case. Now the defense has rested, the judge says the prosecution's rebuttal witnesses will probably be done Friday, with closing arguments starting Saturday morning. And then the judge will give the jury instructions. And he says deliberations will probably start Saturday afternoon. And those jurors are going to have a lot to talk about.

Earlier I spoke with Sunny Hostin from "In Session" on our sister network TruTV, and HLN legal contributor Linda Kenney-Baden, who was Casey Anthony's former defense attorney prior to all this.

(BEGIN VIDEOTAPE)

GUPTA: Linda, you used to be Casey Anthony's attorney. First of all, do you agree with the decision today not to put her on the stand?

LINDA KENNEY BADEN, CRIMINAL DEFENSE ATTORNEY: Oh, absolutely. You know why? When this trial first started, I thought that she had to go on the stand. That was my opinion when I -- after I listened to the opening statement.

And yes, Jose Baez promised it, and yes, it wasn't proven. But after the amount of mistakes made in this trial and I think reversible error if she gets convicted by the death penalty, I would have made the decision, if I were the attorney there today, not to put her on the stand. It was simply too dangerous, too much to give up. It was the best decision he made for his client.

GUPTA: Did the -- did the defense accomplish what you think they wanted to or set out to do?

KENNEY-BADEN: Well, in terms of proving the abuse, no. In terms of proving that there may be reasonable doubt in the issue of the first- degree murder conviction, I think absolutely there's a lot for the jury to work with. Because remember, that duct tape was very, very important.

What they did show is that that duct tape had been moved in some manner, that you can't trust it. If you can't trust the duct tape, you can't trust the death penalty conviction.

GUPTA: Sunny, let me ask you about that, as well. Last night, of course, you said that you thought that she would take the stand. How about you? Were you surprised?

SUNNY HOSTIN, CONTRIBUTOR, TRUTV'S "IN SESSION": I sure did. I am surprised. And that is because of what Jose Baez, Sanjay, said in the opening statement.

I always used to give these really big opening statements when I was a prosecutor. My supervisors would say, "Sunny don't write a check to that jury that they can't cash. You better have the evidence in the bank account."

And I felt that Jose Baez wrote a very big check when he accused George Anthony of sexually abusing Casey Anthony, when he said that Caylee died an accidental death by drowning. Well, where is the evidence of that?

The only person that could have given that, that substantive evidence, that affirmative evidence was Casey Anthony. Now his check has bounced with this jury. I think he's lost all credibility with the jury, and I think that spells trouble for this defense.

GUPTA: But he did raise a lot of confusion, though, which may have been part of the point, as well.

You know, also jurors heard from Krystal Holloway, Sunny, who allegedly had an affair with Casey's father. Now, she claims that George Anthony told her Caylee's death was an accident that snowballed out of control. Did you find her credible overall? HOSTIN: You know, I really did; I found her very credible, especially when you juxtapose her testimony today with George Anthony's testimony the other day. I found him to be very combative, and his denial was very effusive. He said something like, "Oh, I find that funny."

GUPTA: Right.

HOSTIN: And I think when you look at the two together, it's pretty clear that, on balance, she wins that battle.

And I think what's very important to note about that is the judge is going to instruct this jury, Sanjay, that if they feel that a witness is lying about a particular piece of testimony, they are entitled to disregard all of the testimony from that witness. And where does that leave George Anthony, if just one juror thinks he's a liar?

GUPTA: Well, one thing that came up that -- we talked about this before, Linda, was about the chloroform. Tomorrow there may be records that are released that prove that Cindy Anthony was at work and, therefore, not able to make the computer searches she claimed to have made, searching for chloroform among other things. How big a deal is that in those records?

KENNEY-BADEN: Well, I'm sure the defense is probably working with their expert tonight to say those records are not a big deal, because somebody else could have inputted her time sheets, could have shown she was at work.

But I have always thought, Sanjay, that the issue with the chloroform was a red herring for this reason. Her boyfriend at the time had an ad or a comedy act type ad on his Web site -- maybe it was a picture -- that said "Win her over with chloroform." I thought that the reason that they should have given for searching for chloroform for any member of the family is to see whether or not the boyfriend could be making chloroform for her, chloroforming the baby. So I never thought that was a big deal and I'm surprised about the turn at trial where everyone is fighting over the searches.

GUPTA: All right. A lot of people interested in this, obviously. Linda Kenney-Baden and Sunny Hostin, thanks so much

HOSTIN: Thanks.

(END VIDEOTAPE)

GUPTA: And coming up, the FEC gives Stephen Colbert the green light to start a political action committee. You could say he's officially a PAC-man. To sort of mark the occasion, we're going to show you the time that we put him on "The RidicuList". It's one of our "RidicuList" classics. That's next.

(COMMERCIAL BREAK)

GUPTA: Comedian Stephen Colbert has won approval to start a political action committee. And afterward he joked, "I do not accept the status quo, but I do accept Visa, MasterCard, and American Express" -- very Colbert.

By a five to one vote, the FEC today approved Colbert's super PAC which will let him raise money and buy TV time for political ads.

Smart move, FEC, because if one thing -- there's one thing you don't want, it's a feud with Stephen Colbert. Although I have to say, when that opportunity presented itself to Anderson, he didn't shy away, as you'll see in this "RidicuList" classic.

(BEGIN VIDEOTAPE)

ANDERSON COOPER, CNN ANCHOR: All right, time for "The RidicuList". And I've got to admit I struggled tonight whether or not to add this person to the list. But I decided in the end that enough is enough. So tonight, we're adding a man by the name of Stephen Colbert to the list.

Now, at first I must admit I'd forgotten who Stephen Colbert is -- what? Colbert? Really? You're sure. The "T" is silent; Stephen Colbert, apparently. My team of PR professionals actually tell me I have been on Mr. Colbert's show, but I have no memory of that.

Anyway, a couple of weeks ago, I put Sean Hannity on "The RidicuList" because of a clip he used in a show on liberal bias, a clip of me on air, which his show edited to completely change the meaning of what I said.

Anyway, Mr. Colbert took issue and accused me of copying him. He went so far as to create something called "The Absurd-U-Chart" just to put me on it. Look.

(BEGIN VIDEO CLIP)

STEPHEN COLBERT, HOST, COMEDY CENTRAL'S "THE COLBERT REPORT": You, sir, are nothing but a thief because your segment, "The RidicuList", is a clear rip-off of my "On Notice" board. And for stealing my idea, I'm putting you and your "RidicuList" on my "Absurd-u-Chart".

(END VIDEO CLIP)

COOPER: "Absurd-u-Chart", I'm sorry.

Words hurt, Mr. Colbert. Words hurt. Words hurt. Now, the very idea that I'm copying you is simply ridunkulous, which, by the way, was the original name we came up with for "The RidicuList". I cannot believe that you, of all people, say I am copying you when in fact, sir -- oh, that's right, sir, I'm going there -- it has been you who has been copying me for years. That's right. I said it.

I give you exhibit A. Here you are on the cover of the current issue of "Outside" magazine -- like you ever go outside. But oh, wow, where could you have come up with the idea of being on the cover of "Outside" magazine? Could it be from me? Oh, yes. One year ago, April 2010 -- there I am. Look. I'm on the cover of "Outside" magazine.

Not since I woke up disoriented smelling of toner in the Kinko's on 56th and Broadway have I seen such blatant copying.

Now, admittedly, my cover shot was a far more heroic pose. Far be it for me to say, though -- I did just say it.

Exhibit B: here's your Ben & Jerry's ice cream flavor, Stephen Colbert's AmeriCone Dream. A big seller, I'm told; sounds pretty good. Vanilla ice cream with fudge-covered waffle-cone pieces and a caramel swirl. Wow, wonder where you could have gotten that idea? Could it have been from my Ben & Jerry's ice cream, which came out years ago? Perhaps you've heard of it: Anderson Cooper's White Bread Ripple? Little chunks of dry, white toast and vanilla ice cream, with vanilla-covered vanilla pieces, a swirl of gin and -- mmm -- just a hint of tonic. May not be as well-known as yours, sir, but it does have a brisk business in Kennebunkport and Locust Valley late July to early August.

Now, look, I admit your "Absurd-u-Chart" was very funny and particularly the part when you used peanut butter to affix my picture to an actual chart. I thought that was actually pretty inspired.

(BEGIN VIDEO CLIP)

COLBERT: All right. There you go. Boom.

How's that taste, Anderson? I assume like peanut butter. I haven't even checked to see if you had a peanut allergy.

The ratings feud is on. I await your next move.

(END VIDEO CLIP)

COOPER: Now, I know if I was one of these other cable anchors I would try to keep a ratings feud going with you. It would get attention. It would get ratings. It would be mutually beneficial.

But look, I'm not going to do that. I'm willing to just let bygones be bygones. We're both adults, both TV professionals. There's no need for a feud. It's certainly not worth it for me, because as we all know, at the end of the day everyone goes to sleep after "The Daily Show" anyway.

So here's to you, Stephen Colbert. Love your "Absurd-u-Chart" and I'm proud to have you on tonight's "RidicuList". Pass the peanut butter, please.

(END VIDEOTAPE)

GUPTA: A braver man than me. We've been to a lot of war zones together, but he's taken on Stephen Colbert. Good for you, Anderson. I like the -- I like the ice cream flavor, by the way.

Still ahead, summer in the city and a CNN Hero. In one of Chicago's roughest neighborhoods one woman's crusade to get kids off the streets.

(COMMERCIAL BREAK) GUPTA: Tonight another CNN Hero. She's a mother of eight from Chicago's South Side where gun violence and gangs are just a fact of life.

In 2003 she opened her door to neighborhood kids and started a community center in her living room. Recently she turned the building next door into an even bigger haven for kids and teens, offering tutoring, mentoring and job training to keep them off the streets, out of gangs and focused on their futures.

Take a look.

(BEGIN VIDEO CLIP)

DIANE LATIKER, CNN HERO OF THE WEEK: Guns, guns and more guns. These are our young people. These stones represent them. We're losing a generation to violence.

UNIDENTIFIED FEMALE: When they start shooting you got to grab the kids and run into the house.

LATIKER: People run in the house and close their doors. They don't want to talk about it. But there's some people who are not scared to go outside and I'm one of them.

My name is Diane Latiker. We opened the community center called Kids Off the Block. It is known as KOB.

They're kids in gangs, they're homeless, some of them drug dealers. So they got a lot of issues going on.

Who signed up and (INAUDIBLE) the way to Chicago?

I tell kids this is a peace place. This is a safe place.

UNIDENTIFIED MALE: I really want to be a veterinarian.

LATIKER: We have leadership workshops, media (ph) preparations; community (ph). It's a range of things that goes on in here.

We started out with 10 young people. The next thing I knew I had 15, then I had 25. At one point I had 75 young people in three rooms at my house. And that's why Kids off the Block started in my living room.

We open the doors to the new KOB center in July. Last year we served 301 young people. If they knock on that door, they can come in.

UNIDENTIFIED MALE: I was 12 when I got in here; robbing people, stealing. Diane, she changed my life. I love her for that.

LATIKER: I'm no different from nobody else. I just opened up my door. Why can't they all come outside and see what's going on in our neighborhoods?

There are people here who care. And I'm one of them. (END VIDEO CLIP)

GUPTA: Last year Diane's center helped more than 300 kids stay off the streets and out of trouble.

Remember we choose each of our CNN Heroes from people you tell us about. To nominate someone you know who's making a big difference in your community go to cnnheroes.com

That does it for this edition of 360. Thanks for watching.

Piers Morgan starts right now.