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Jury Ordered Out of Manafort Trial for Sealed Hearing; DOJ Released Manafort E-mail Recommending Banker to Jared Kushner; Trump Campaign Files for Arbitration Against Omarosa for Violating NDA; Trump Criticizes Sessions for Inaction & Witch Hunt. Aired 11:30-12p ET

Aired August 14, 2018 - 11:30   ET

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


(COMMERCIAL BREAK)

[11:32:20] KATE BOLDUAN, CNN ANCHOR; Everybody out. The public and the jury ordered out of the courtroom in Paul Manafort's trial this morning as the judge ordered the second sealed hearing in two days. What are they talking about? It has been a mystery. Stay tuned.

This comes a day after prosecutors rested their case against the former Trump campaign chairman, and after the president's son-in-law became part of the case. An e-mail released yesterday by the Justice Department shows that Manafort was recommending to Jared Kushner a bank chairman for a top post within the Trump administration after that bank had loaned Manafort millions of dollars.

CNN's Joe Johns is following the trial. He is outside the courthouse right now.

Joe, what's the latest?

JOE JOHNS, CNN SENIOR WASHINGTON CORRESPONDENT: That's about it, Kate. The judge cleared the courtroom this morning right after they got started. Sent everybody out, sent everybody out of the overflow room. Throughout the morning, there's been discussions between the attorneys and the judge. We don't have a clue what that's about. This is something that happened on Friday. Big mystery here. Waiting for it to be solved.

Meanwhile, the other new piece of information we got today was that the defense has now filed a formal motion with the judge asking him to knock out the bank fraud counts relating to Federal Savings Bank. This, of course, is the bank that was run or at least had the CEO, Stephen Calk, who Manafort had some discussions with over the loan. Manafort subsequently asked for him to essentially become secretary of the Army under Donald Trump. The argument that the defense is making is that this loan didn't have anything to do with false information that was submitted by Manafort to try to get the loans. What they're saying is that Stephen Calk certainly wanted to get a job in the Trump administration and went in fully informed about giving Paul Manafort the loan irrespective of any false information that Manafort supplied. The problem with that argument, the prosecution contends, is, look, this is a guy, quite frankly, who had a lot of problems. And this is a guy also who signed a document -- I'm talking about Manafort now -- signed a document just like any other loan document you see that indicates, if you provide false information, you could go to jail.

The other piece, of course, Jared Kushner, that's simple, Kate. On November 30 of last year, after the campaign was over, Manafort wrote him an e-mail suggesting Stephen Calk for secretary of the Army. Jared Kushner wrote back on it. No indication at all that Jared Kushner knew anything about bank fraud, conspiracy, loans or anything else.

Back to you.

[11:35:20] BOLDUAN: Joe, thanks so much.

Joining me now, CNN legal analyst, defense attorney and former federal prosecutor, Shan Wu. For a brief time, Shan represented Manafort's former deputy, who is a star witness in this case, in this trial, Rick Gates.

Shan, getting word that the Manafort trial is now going to be resuming. The sealed hearing is over. People are starting to file back into the courtroom. I'm seeing this on my e-mail. What happens in the sealed hearings? What could this be about?

SHAN WU, CNN LEGAL ANALYST: Typically, the judge will clear the courtroom when they need to have more extensive arguments about an issue that really aren't practical to do standing at the bench. That's probably what this was about. It's going to be something that was substantive. Otherwise, they could take care of it with a brief conference at the bench. Put their questions with what they're talking about. So I'm speculating what it was. It's probably a substantive legal argument.

BOLDUAN: The prosecution rested its case. What now? What do you think the defense does?

WU: I think it's pretty likely, if I was going to predict, that the defense is not going to put on any more testimony, that they are going to move right to their closing argument. I think they feel that they have done what they needed to do in terms of scoring their points on cross examination, both of Rick Gates as well as kind of strategically picking apart some of the points that the prosecution was putting forth. I think they will probably move straight to closing. I don't think they will put Manafort on.

BOLDUAN: Still a chance. Stay tuned to stay tuned.

Thank you so much. Appreciate it.

SHAN: Thank you.

BOLDUAN: Coming up, Peter Strzok gets a pink slip from the FBI. Now what? The president seems to have a lot to say following Strzok's firing. We will talk to the top member on the House Judiciary Committee on where this goes next and what this means.

We'll be right back.

(COMMERCIAL BREAK)

[11:41:47] BOLDUAN: Breaking news just in. President Trump's campaign is now taking legal action against Omarosa, the former Trump White House adviser, former campaign adviser, for breaching a 2016 non-disclosure agreement with the Trump campaign over this publicity tour rollout of her book.

CNN's Jeremy Diamond is at the White House with the details.

Jeremy, what do we know?

JEREMY DIAMOND, CNN CORRESPONDENT: It appears that Trump world is striking back against Omarosa after several days during which she has embarked on this publicity tour sharing some details from her tell-all book about times during the campaign and in the White House. The Trump campaign has now filed for arbitration against Omarosa, accusing her of breaching this non-disclosure agreement that she reportedly signed during the 2016 campaign.

Here is the statement from a Trump campaign official which says, "Donald J. Trump for President, Inc. has filed an arbitration against Omarosa Manigault Newman with the American Arbitration Association in New York City for breach of her 2016 confidentiality agreement with the Trump campaign."

This is the first legal move that we have seen from the Trump campaign or from any part of Trump world, frankly, in response to Omarosa's new book and the allegations she is making against the president and about -- and revealing private conversations that she had with Trump campaign aides, often times backed up by audio recordings she made, apparently without the knowledge of the other people involved here.

It's notable how the campaign is going about this. What we have seen in the past when they have tried to go after non-disclosure agreements they say have been violated, they filed cease-and-desist letters. They have started legal action by directly suing individuals. Sam Nunberg was one of them during the 2016 campaign. So this is a little bit of a different step. It's not quite as forceful as a lawsuit. It's filing for arbitration to try and get the parties in a room with a third-party mediator here to discuss this breach and see what the next steps forward are.

BOLDUAN: Jeremy, thank you. Appreciate it.

Let me bring back Shan Wu, who stuck around for us with this breaking news.

Shan, what does this mean that they are filing with arbitration?

WU: It's interesting. It may be that her non-disclosure agreement with the campaign has a mandatory arbitration provision. That's common since it's accepted that arbitration moves more quickly and is less cumbersome than having to start a lawsuit where you have delays, motions, discovery. It may be sort of a shortcut. That's why they have to first do the arbitration. I think it's really interesting to note that since she rejected

signing a new NDA, they are relying on the one from the campaign. A potential issue would be what was the sunset clause on that? Would it end when the campaign ended? Are they arguing she's also breaching confidences from the campaign? A lot of potential issues to dissect with this.

BOLDUAN: Would it be reasonable if there was no sunset on it, it was forever? You can't say anything and you can't -- is that within the realm of possibility?

WU: They often do have that in terms of the sunset of the time limit. I think a substantive question might be arguing that she is only prohibited from talking about the campaign issues and she's under no obligation or restriction on what happened in the White House.

[11:45:13] BOLDUAN: Do you think this will work? Do you think this will affect -- if you had to guess, without -- of course, we haven't seen the NDA. There's a lot of things we don't know, Shan. Welcome to it. Do you think that this is a possibility that this could stop her from releasing any other tapes?

WU: Legally, it could. I think the posture she's in, she's probably going to take a hard line and keep at it and let the chips fall where they may.

BOLDUAN: Shan, thanks. Appreciate it.

WU: Thank you.

BOLDUAN: Let's bring back in Chris Cillizza, who jumped back in the chair.

Chris, what do you make of this? This sounds like that Trump world, they are taking this seriously.

CHRIS CILLIZZA, CNN POLITICS REPORTER & CNN EDITOR-AT-LARGE: Absolutely. I think in some ways, Kate, we knew this based on Trump's tweets. I tell people, watch his tweets. That's what he cares about, what he is focused on. We have had eight Trump tweets on Omarosa over the last 24 hours. This was not something that he was sort of dismissing.

The other thing I would say is, remember what we know about Donald Trump. This is someone who is quite litigious and has been his whole life.

(CROSSTALK)

BOLDUAN: He also says he never settles, and he does.

CILLIZZA: Absolutely. By the way, I was going to add, Kate, he says he is suing people and he doesn't. Donald Trump, during the 2016 campaign, promised he would bring lawsuits for defamation against all -- more than a dozen women who said he acted inappropriately with them. He hasn't brought any of those lawsuits as far as I know. Remember, there was some legal back and forth related to Michael Wolff's book as the Trump campaign tried to shut some of that down. This is not a strategy we have not seen both Donald Trump in the White House, and Donald Trump more broadly as a politician and as a person. I don't think it's surprising.

By the way, another thing we know about Donald Trump, he really loves those non-disclosure agreements. None of this is all that shocking. It does ramp things up.

I'm with Shan. The likeliest thing is Omarosa is a manifestation of Donald Trump. I think the most likely thing you will see is, what would Donald Trump do if faced with arbitration over allegations he was making? He would probably just keep going. My guess is that's what Omarosa will do.

BOLDUAN: Thanks, Chris. Appreciate you guys.

CILLIZZA: Thank you.

BOLDUAN: Appreciate it. Thanks for jumping on.

We will continue to see in Omarosa puts out a statement, what her reaction is. Again, we continue to follow the bouncing ball.

Coming up, Peter Strzok is out, much to President Trump's pleasure. Does that impact the rest of the Russia investigation? We will ask a top member of the House Judiciary Committee where this goes, next.

(COMMERCIAL BREAK)

[11:52:19] BOLDUAN: The FBI fired FBI Agent Peter Strzok Friday, but President Trump isn't ready to let up. In a pair of tweets this morning, he wrote this, the president called Strzok "a fraud." He started what Trump calls the, "Illegal rigged witch hunt."

The FBI says it was justified showing Strzok the door because of his anti-Trump tweets while he was part of the original team investigating Russian interference in the investigation. But Strzok's attorney does not agree.

(BEGIN VIDEO CLIP)

AIDAN GOELMAN, ATTORNEY FOR PETER STRZOK: We had an agreement with the FBI OPR, Office of Professional Responsibility, which is their main caretaker for internal discipline, that Pete would get a 60-day suspension and a demotion. At the last minute, that was countermanded by the higher ups, and he was fired. So, yes, we were surprised.

(END VIDEO CLIP)

BOLDUAN: All right. Joining me now, Congressman Jerry Nadler, of New York, the top democrat on the House Judiciary Committee, which has oversight over the FBI.

Thanks for coming in.

REP. JERROLD NADLER, (D), NEW YORK: Pleasure.

BOLDUAN: I haven't seen a statement from you about Peter Strzok's firing. What's your reaction?

NADLER: My reaction is several-fold. First of all, it's grossly unfair to Peter Strzok. He had his very strongly felt opinions about Donald Trump, along with half the American people. He expressed them to his girlfriend. He's entitled to his opinions. He's entitled to express them. Arguably, the only thing he did wrong was use an FBI telephone to send the text messages to his girlfriend. He was then vilified by the president and by the president's minions, along with a number of other people, starting with Comey and McCabe and others to try to make the argument that the investigation was compromised somehow, that the investigation -- this is a part of a plot to pre- butt -- to have a pre-rebuttal whatever the --

(CROSSTALK)

BOLDUAN: Who's at fault here then? The FBI says they followed protocol.

NADLER: The FBI did not follow protocol. The protocol said he should be demoted -- or rather suspended for 60 days. That was overruled in what I'm told is an unprecedented way. But in addition --

(CROSSTALK)

BOLDUAN: So do you think they're bowing to political pressure?

NADLER: Yes, I think they're bowing to political pressure. I think exactly they're bowing to political pressure. More to the point, this is --

(CROSSTALK)

NADLER: You see when the president goes after a career civil service person, which is what Strzok was, with tweets -- he's the president of the United States and he vilifies them before he's fired, after he's fired. Of course, there's political. More to the point, this is part of a plot to discredit the investigation. Nobody --

(CROSSTALK)

BOLDUAN: Involving the FBI now?

NADLER: Yes. They're trying to discredit the FBI and the Department of Justice.

BOLDUAN: No, the FBI is now involved in discrediting the investigation?

[11:55:02] NADLER: No, whoever made that decision in the FBI.

BOLDUAN: The deputy director.

NADLER: The deputy director bowed to the pressure. He bowed to the pressure. But the --

(CROSSTALK)

BOLDUAN: But you have oversight over the FBI. So is Christopher Wray going to --

(CROSSTALK)

NADLER: We're not exercising the oversight because the Republican leadership of the Judiciary Committee refuses to hold hearings on any of this, refuses to exercise oversight.

(CROSSTALK)

BOLDUAN: But, Congressman, are you calling on Christopher Wray to now answer questions about this firing?

NADLER: I think he should. I think that's a good idea.

But the main point -- remember, no one -- no one --the inspector general made a finding that Strzok did not do anything to prejudice the investigation, did not bring his political opinion into it in any way. No one has made a specific allegation of his doing so. He's entitled to his opinion. More to the point, he's just a victim. What all of this is, is an attempt to discredit the investigation because he was involved to some extent in the beginning of the investigation. Although, unlike what they're saying, he had nothing to do with initiating the investigation. That was initiated because of Papadopoulos telling somebody about --

(CROSSTALK)

BOLDUAN: But this is important. The deputy director of the FBI, you say, is bowing to political pressure in firing a career agent who's been with the FBI for 20-plus years. You say that the deputy director is bowing to political pressure.

NADLER: I say the appearance is that he's bowing to political pressure. I don't know what was in his mind. All we know is, one, the normal processes, which as far as I know, never have been overruled, recommended a 60-day suspension. Number two, the deputy director of the FBI overruled that in an unprecedented way. Number three, did this in the face of the president saying that Strzok should be fired.

BOLDUAN: How are you going to get -- I mean, it is your job to get these answers. How are you going to get these answers?

NADLER: All we can do since we're in the minority is ask the committee leadership to hold a hearing, which I'm sure they will not do. We have asked for over 80 hearings.

BOLDUAN: I know it happened just on Friday. It was announced yesterday. Have you spoken to Goodlatte about this? Have you --

(CROSSTALK) NADLER: Not yet, but we will. The point is we have asked for over 80 hearings on various subjects, whether the Russian interference in the election, the Russian continuing interference in the elections, the children separated at the border, and they have done nothing. All they want to investigate is the beginning of the Russian investigation and investigate the investigation of Hillary. That's all they want to do.

BOLDUAN: We'll follow up with you. I will definitely follow up with you, especially when the House goes back in session. If you think he was wrongfully terminated, then it is an important conversation to have, especially if it comes from political pressure, bowing to political pressure within the department.

I do want to ask you, though, about the attorney general. The president has made it a practice to criticize him, and is at it again today with a new tweet saying, "If we had a real attorney general, this witch hunt would never have been started. Looking at the wrong people."

Yesterday, he said the attorney general is "scared stiff" and "missing in action."

I have to tell you, I look at this, and I do think words and actions -- he's always slamming Jeff Sessions. Jeff Sessions is still in the job. He's doing nothing about it. Is there a real reason to be concerned about this?

NADLER: Yes, I presume that the reason that Jeff Sessions is still on the job is that some very good lawyers have told the president if he fires Jeff Sessions after saying all these things, then it would become apparent that the reason he's firing Jeff Sessions is that he won't shut down the investigation, that would be more evidence for an obstruction of justice charge against the president. That's probably the only reason Jeff Sessions is still there.

BOLDUAN: I mean, but he -- but Jeff Sessions is still putting forth the agenda. He's still pushing the president's agenda. Jeff Sessions still seems to be happy on the job.

NADLER: Jeff Sessions is a very reactionary Republican who's pushing a right-wing Republican agenda. That's certainly the president's agenda, too. Without this investigation and without the fact that Sessions had recused himself and, therefore, is not in a position to quash the investigation, I'm sure the president would be very happy with Sessions. His upsetting with Sessions is he won't be his Roy Cohn, as the president put it. He won't stop the investigation. If he did, that would be another indication of obstruction of justice, which we may be hearing about.

BOLDUAN: Real quick, just because it is so much we're talking about today, can I get your reaction to what's going on between Omarosa and the president?

NADLER: Well, neither character in this soap opera deserves any sympathy or trust. I don't trust the word of the president, who's shown himself to be a serial liar. Apparently, Ms. Manafort (sic) --

BOLDUAN: Ms. Omarosa, you mean.

NADLER: Ms. Omarosa may also be a liar. The fact she taped in the Situation Room in the White House is not the right thing to do. But those tapes may be very revealing of a very ugly president.

BOLDUAN: I have to cut in because we have more breaking news coming in.

Thank you for your time.

I'm going to wrap up here with breaking news.

NADLER: Thank you.

BOLDUAN: The defense has just rested in the Paul Manafort trial. And with that, I'm going to thank you right now.

Because outside the courthouse, I'm going to hand this over to --