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NANCY GRACE

Missing Boy`s Body Washes Ashore, Mom Still Missing/Casey Anthony Notes to Other Inmates Reported

Aired March 18, 2010 - 20:00:00   ET

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


NANCY GRACE, HOST: Breaking news tonight in the search for a 2-year- old Florida girl, Caylee. Six months of searching culminates when skeletal remains found in a heavily wooded area 15 houses from the Anthony home confirmed to be Caylee. A utility meter reader stumbles on a tiny human skeleton, including a skull covered in light-colored hair, the killer duct- taping and placing a heart-shaped sticker directly over the mouth, then triple bagging little Caylee like she`s trash.

Bombshell tonight. In the last hours, tot mom Casey Anthony in court, admitting she bagged over a quarter million dollars so far, but tot mom says she`s broke, wants you to pay for her multi-million-dollar defense.

This after torpedo to the defense, reports grandfather George Anthony starts an affair when Caylee goes missing, and during pillow talk, confides little Caylee was killed by tot mom by accident. So much for the defense claim somebody else did it. Grandfather George Anthony denying the affair and statement.

And another blow to the defense revealed in court today. Did tot mom secretly pass 50-plus handwritten notes to a female inmate? Did she confess?

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Slow down a little bit. Sir? Sir, can you hear me OK? We`re really having a tough time.

UNIDENTIFIED MALE: Anthony`s lawyers have asked the state of Florida to pay for part of her defense in her upcoming murder trial. The Orange County clerk of courts has declared her indigent, and lawyers want the judge to agree.

CASEY ANTHONY, CAYLEE`S MOTHER: I`m not in control over any of this because I don`t know what the hell`s going on!

UNIDENTIFIED MALE: There is no dispute that Casey Anthony is indigent and entitled to the due process funding of her case.

CASEY ANTHONY: I don`t know what`s going on! My entire life has been taken from me!

UNIDENTIFIED MALE: (INAUDIBLE) question her indigency now. There`s just a road map that we have to go through.

CASEY ANTHONY: You don`t understand! Everybody wants me to have answers. I don`t have any answers because I don`t know what`s going on!

UNIDENTIFIED MALE: Do you have any reason to believe that Casey Anthony, having been in jail for the last 22 months, has any money anywhere?

UNIDENTIFIED MALE: Absolutely not.

CASEY ANTHONY: I`m trying to make sure that I`m not -- I`m not going to give anybody anything else to throw against me!

UNIDENTIFIED MALE: I`m going to see this case through. I`m going to try this case in a courtroom. And I look forward to celebrating the acquittal of Casey Anthony.

(END VIDEO CLIP)

GRACE: First, breaking news, Washington state. Two days ago, we put out the alert about a young mom, Shantina Smiley, and her beautiful 8-year- old boy. They head out to visit their grandfather 120 miles away. In the last hours, a body washes ashore, Fox Island, Pierce County, Washington, the boy`s T-shirt pulled up over his face. Is it 8-year-old little Azriel? One of the last sightings, Mommy buying a jug of wine, the little boy standing there at her side.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: There looks to be an abandoned car or stolen vehicle on my beach property.

UNIDENTIFIED MALE: Breaking news, and it looks to be sad news.

UNIDENTIFIED MALE: It`s partially submerged.

UNIDENTIFIED MALE: Police have found the body of a young boy.

UNIDENTIFIED MALE: It makes no sense.

UNIDENTIFIED MALE: The body was found on the shore this afternoon.

UNIDENTIFIED MALE: We have no idea what happened.

UNIDENTIFIED MALE: Authorities have not made a positive ID.

UNIDENTIFIED MALE: It`s really bizarre and...

UNIDENTIFIED MALE: We do not know if it`s little Azriel Carver.

UNIDENTIFIED MALE: We just don`t know.

UNIDENTIFIED MALE: There`s no rational explanation for why Shantina`s van ended up abandoned...

911 OPERATOR: All right, so do you see anything -- anybody inside or...

UNIDENTIFIED MALE: No. Uh-uh. No.

UNIDENTIFIED MALE: ... and stuck on a Puget Sound beach Saturday night.

UNIDENTIFIED MALE: The doors are all open.

UNIDENTIFIED MALE: Shantina and her 8-year-old son were last seen driving all over Olympia.

UNIDENTIFIED MALE: This video shows Shantina and her son at a West Olympia mini-mart about 8:00 PM Saturday.

UNIDENTIFIED MALE: She`s very intelligent, well read, well spoken.

UNIDENTIFIED MALE: She was apparently lost and can be seen on the video looking at a map and getting directions.

UNIDENTIFIED MALE: Workers say her behavior was odd and she fell in the parking lot.

UNIDENTIFIED MALE: On the darker side of that, you have to wonder, you know, does somebody have her?

(BEGIN VIDEO CLIP)

GRACE: Straight out to Ed Troyer, spokesperson, Pierce County Sheriff`s Department, joining us, Fox Island, Washington. Ed, thank you for being with us. What can you tell us about the little boy`s body that has washed ashore?

ED TROYER, SPOKESMAN, PIERCE COUNTY SHERIFF`S DEPT. (via telephone): Well, we`ve positively identified it as being the missing boy from Thurston (ph) County. And once we processed the scene here in the last half hour and got a better look, he had the Mohawk haircut. And we unraveled the clothing and it was the same clothing that you last saw on the surveillance video.

So his father is here, and we went ahead and made notification. And the medical examiner has taken him from the scene on a boat because we`re down below some cliffs, and they`re going to have to take him by water back down to the city where the medical examiner`s office is.

GRACE: Oh, Mr. Troyer, Sheriff Troyer, I hate to hear it so much. Do we know the cause of death of little Azriel?

TROYER: Well, that`ll be determined tomorrow during the post. Right now, you know, as you know, water -- being in the water for a few days causes trauma on a body, so we`re not going to be able to determine anything here at the scene. That`s going to have to be done in a more clinical setting, and we`ll be waiting for the medical examiner`s office to do their post and give us the information. And we`re working with the other county where he disappeared. Their detectives are out here, as well, and we`ll all be working together on this tomorrow.

GRACE: Sheriff, how far is this Fox Island from where the mother`s gold van was left abandoned?

TROYER: Well, it`s got to be about 15 miles straight across the water and around two or three islands. But you know, this is Puget Sound, so the tide moves really fast through some of these channels. So it`s not unreasonable to think that if his body was in the water that it would come this far this quickly. In fact, we`ve had them go a lot further away than that when people have gotten in the water here in Puget Sound. So it`s pretty consistent with him being in the water where that van was.

GRACE: And no sighting whatsoever of the mother`s body?

TROYER: No. We have a Coast Guard helicopter doing the shoreline searches right now. We have our divers doing the waterline searches, and we`re walking the driftwood along the shore throughout the area, trying to determine if she`s in this area, too. When the tide comes back out tomorrow, we`ll be doing the same thing to see if she has washed up because if she would have went in the water in the same location that he did, chances are they`d be close.

GRACE: Everyone -- to those of you that are just joining us, a few nights ago, we put out the alert for a missing mom, a beautiful young woman, and her 8-year-old little boy. They headed out on a 120-mile trek to go see the grandfather. They never showed up. They were spotted in various locations, at gas stations, mini-marts. They pulled in at somebody`s home, trying to find directions. She had never been to this location before. And now this.

We do have video surveillance of the little boy. You see him right there, standing by his mother`s side. One of the last sightings was of the mom buying a jug of wine, the little boy standing there with her.

Back to Sheriff Ed Troyer, the spokesperson, Pierce County Sheriff`s department, joining us, Fox Island Washington. Sheriff, did you find the jug of wine also?

TROYER: No, no, no. What we`re -- we just found the body washed up on shore. There was nothing else on the beach with it. It was a pretty isolated beach. There`s nothing, no homes or anything within 300 or 400 yards in either direction. So it obviously had come up when the tide came up high because the body was sitting right where the high tide line was.

And as far as anything else, there`s nothing else here. And if that was found down in Thurston County with the actual scene where this all started, I wouldn`t know that.

GRACE: Right. You know -- you know, Sheriff Troyer, I do believe you`re correct about it being found in the other jurisdiction.

To Matt Zarrell, our producer on the story. Liz, let`s show that shot of items recovered. Wasn`t the jug of wine discovered half empty?

MATT ZARRELL, NANCY GRACE PRODUCER: Yes, it was, Nancy. It was discovered about a quarter of a mile from where the van was found. Now, she was seen at the mini-mart on surveillance about 7:50 PM Saturday night, buying the jug of wine. The jug was found half empty, corked, not broken at all.

GRACE: We are taking your calls. Out to Ann in New Hampshire. Hi, Ann.

UNIDENTIFIED FEMALE: Hi, Nancy. A pleasure to be on your show.

GRACE: Thank you for calling in. What`s your question, dear?

UNIDENTIFIED FEMALE: My question is, I thought I heard somebody say that they witnessed her stumbling and falling after buying the wine. Why would anybody let her get in the car and drive with a young child after seeing that? I just feel the public needs to be more involved when it comes to a case of a child and stand up and go to that woman and say, You should not be driving. You know what I`m saying, Nancy?

GRACE: I know exactly what you`re saying, Ann in New Hampshire. And you know what? You are exactly right. To Matt Zarrell. What do we know about the mom allegedly stumbling?

ZARRELL: OK, now, Mom was at a diner at about 9:08 PM that night. Mom orders a corndog to go, pays for it, doesn`t take it. She comes out of the diner, and reports are she stumbled and fell in the parking lot. She HAD appeared sleepy at times. The boy even talked to residents. They had stopped at a house at about 10:00 o`clock to ask for directions, and the boy even mentioned to the couple staying at the home that his mother had fallen. But police are saying that they did not believe that the fall was serious, that she just had hurt her knee.

GRACE: Out to the lines. Denise, Illinois. Hi, Denise.

UNIDENTIFIED FEMALE: Hey, Nancy! How are you?

GRACE: I`m good, dear, although I`m very concerned.

UNIDENTIFIED FEMALE: I`m heart-broken...

GRACE: I`m very concerned. I`m distraught about this case...

UNIDENTIFIED FEMALE: Oh!

GRACE: ... because we were told at the beginning that this young lady was a recovering alcoholic...

UNIDENTIFIED FEMALE: Right!

GRACE: ... and that she had fallen off the wagon, and then goes on -- God help that little boy -- a 120-mile trek...

UNIDENTIFIED FEMALE: Oh, I know!

GRACE: ... to see the grandfather. And now this. Now this!

UNIDENTIFIED FEMALE: You know what? I don`t know why Susan Smith comes to mind!

GRACE: Oh! Well, the little -- her three young children, strapped in seatbelts. She pushes the car into the water. She`s still behind bars right now, apparently queen of the jailhouse. Denise, do you have a question?

UNIDENTIFIED FEMALE: It`s heart-breaking! I just wondered about, if they were able to put a better timeline together, you know, with this videotape and everything. And what about the people she visited because she was lost?

GRACE: Exactly. What about it, Matt Zarrell? What do we know about the timeline?

ZARRELL: OK, since...

GRACE: And didn`t any of these people at all of these locations notice Mom stumbling drunk?

ZARRELL: Well, there were reports that Mom appeared sleepy. I have not appeared any reports that she was intoxicated in any way. Now, we know after 9:08, she leaves the diner, she goes to the gas station, looks to use the phone. It`s not available, about 9:50: At 10:00 o`clock, she stops at a local residence, asked for directions, calls Grandpa at 10:10. We don`t know when she left the residence. That is the last known sighting.

GRACE: Tonight, the body of 8-year-old Azriel James Carver has been positively identified by Pierce County Sheriff`s Department, last seen with his mother on a 120-mile trek to go see Grandfather, mother, recovering alcoholic. One of the last sightings was her at a mini-mart buying a jug of wine, the little boy standing at her side.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Looks to be an abandoned car or a stolen vehicle on my beach property, and it`s partially submerged.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Breaking news for you. A boy`s body has washed up in south Puget Sound in Washington state.

UNIDENTIFIED FEMALE: It is what appears to be a child`s body.

UNIDENTIFIED MALE: Azriel and his mom, 29-year-old Shantina Smiley, disappeared on Friday. Now, their van was found on a private beach...

UNIDENTIFIED MALE: Looks to be an abandoned car or a stolen vehicle on my beach property, and it`s partially submerged.

UNIDENTIFIED MALE: Authorities believe this is little Azriel.

UNIDENTIFIED FEMALE: The area where they went missing from is a pebble beach which dips off into a channel that has rough currents -- easily take people down there. I also spoke with a spokesperson for the Gape Harbor (ph) Fire Department. They were dispatched out there to reports of a body. They did, in fact, found that body, and Tacoma Fire Department is bringing out their fireboat to see if possibly the mom is in the water or if there`s any other evidence or clues out there.

(END VIDEO CLIP)

GRACE: We are taking your calls live. In the last moments here on the air, spokesperson Sheriff Ed Troyer has positively identified this little body as that of 8-year-old Azriel James Carver, just beautiful little boy. Also found, a ball that he played with all the time, a half empty jug of wine. His little body washed up ashore about 15 miles away from where his mother`s gold mini-van was found parked, the doors open, her wallet still inside, no sign of her body. The two last seen alive when they -- here are the items washed ashore. There`s the little orange ball, the baseball that he played with all the time, he took in the car with him, the wine. Apparently, it was open, corked and half full when discovered. He headed out with his mom to go see his grandfather 120 miles away. They apparently stopped at several places trying to get correct directions, including a mini-mart, one of the last sightings of them alive, where Mommy buys a jug of wine, the little boy standing there faithfully at her side.

We are taking your calls. To Sheeba, Illinois. Hi, Sheeba.

UNIDENTIFIED FEMALE: Hi, darling! You look beautiful tonight! How`s little Lucy feeling?

GRACE: Little Lucy is so much better.

UNIDENTIFIED FEMALE: Oh, good!

GRACE: She -- and when I think about this -- you know, when I drive with the twins in the back, strapped in, don`t you know it, everybody gets mad at me. There`ll be a line of cars behind me. I`m going about 25 miles an hour.

UNIDENTIFIED FEMALE: Yes, I`m...

GRACE: I`m so -- I was a speed demon before they came into my life. I mean, just thinking about this mother and her jug of wine and the little boy standing beside her there at that mini-mart.

UNIDENTIFIED FEMALE: So upsetting! You know, you had told the other night that you had never dealt with a gun and seen (ph) him (ph). I wanted you to know that I grew up with them. My dad did everything from polar bear hunting, which was legal back then, to quail hunting.

GRACE: Right. And?

UNIDENTIFIED FEMALE: We had guns all over our house.

GRACE: OK, now, how -- what`s your question about this case?

UNIDENTIFIED FEMALE: OK, this -- this -- this little boy here -- what happened to Mama? Could they have washed up under a bridge (INAUDIBLE)

GRACE: Good question. Out to Paul Penzone (ph), director of prevention programs at Childhelp.org. You were a former sergeant with a police department, a big police department. What do you make of it, Paul?

PAUL PENZONE, CHILDHELP.ORG: Oh, it sounds like the law enforcement there is really doing everything with the resources they have to try to stay on top of this, and I commend them for those efforts, just them talking through all the processes, because it`s a big -- it`s a big search.

But what sticks with me is your first caller talked about, Why didn`t somebody notice something? It`s obvious that there was some type of impairment. And at Childhelp, our theme is "It takes a village to raise a child." You can never err on the side of being too cautious when you`re looking out for a child. Something out of an ordinary, make a call and let law enforcement look into it. No one`s to blame right now, but God forbid, if somebody had called early and maybe got her before this occurred, it could have saved a life.

GRACE: I`m just sick about it, Paul. I am sick about it.

Everyone, we are taking your calls live. It has just been confirmed here on our air that this little body is that of 8-year-old Azriel James Carver. No sign of his mother`s body as of yet.

To tonight`s "Case Alert." The search for a 4-year-old little Oregon girl, Zoey Dorsey, reported missing Wednesday afternoon from her home, Broooking (ph). Little Zoey, 3-6, 40 pounds, brown hair, brown eyes, last seen wearing a white Disney shirt, blue pants, white, purple and blue tennis shoes that light up. If you have information, call Curry County sheriff toll-free, 800-543-8471.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: There is no dispute that Casey Anthony is indigent and entitled to the due process funding of her case. We`re not seeking attorneys` fees. It`s no secret I have filed an appearance in this case. I`ve been asked to join in, and I`m doing it pro bono, so there`s no million-dollar worry here. We`re interested in costs to ensure that she has a fair trial.

(END VIDEO CLIP)

GRACE: Tot mom in court just a couple of hours ago, admitting she`s bagged over quarter million dollars after her daughter`s disappearance and death. But now she says she`s broke, wants you to pay her multi-million- dollar defense bill.

Straight out to Jeanne Casarez, legal correspondent, In Session. What happened?

JEAN CASAREZ, IN SESSION: Nancy, this began as a very routine defense motion for indigency, that the client, the defendant, Casey Anthony, has no money. Today grew, Nancy, into a full-blown hearing, where defense attorneys got up on the stand, having to answer questions as to what moneys they had received and where those moneys went. And here`s what we found out.

On the stand, Jose Baez said that he had been approached for a book deal. He said that a former director of ethics for the state bar, he leaned on, who said it was inappropriate. He said money wasn`t even discussed. He said Casey Anthony, though, received $200,000 from ABC, $5,000 from an anonymous donor, and $70,000 went to the defense from former defense attorney of the team Todd Maccaluso (ph) out of California.

GRACE: Another thing happened in court. Also joining us, along with Jean Casarez, there at the Orlando courthouse, Natisha Lance. Natisha, we found out -- remember, a couple of weeks ago, we reported the state had some evidence that they considered so big and so volatile that they needed to keep it secret, even from the defense for now. We got a glimpse of what that is. Is it 50-plus handwritten and secret notes passed by tot mom to a female inmate behind bars?

NATISHA LANCE, NANCY GRACE PRODUCER: You`re absolutely right, Nancy. That is what this unsealed -- now unsealed information is. What we`re seeing, two inmates, one of the inmates went to the Orange County sheriff`s office, said that she had communication with Casey Anthony and was aware of this other inmate also having communication with Casey Anthony. The second inmate was questioned. She said, reluctantly, that she has had communication with Casey Anthony. They developed a friendship. Fifty letters Casey Anthony has corresponded with this woman...

GRACE: Natisha...

LANCE: ... and now the Florida...

GRACE: Natisha, do we have the letters yet? Does the state...

LANCE: No, we don`t, Nancy.

GRACE: ... have them in their hand? Or could they be destroyed?

LANCE: The state does have them. The defense has 15 days to review them and then possibly come back with a motion to have them sealed.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: There`s no dispute that Casey Anthony is indigent and entitled to due process funding of her case.

CASEY ANTHONY, MOTHER OF CAYLEE ANTHONY: I need to be looked at as a victim. And I`m just as much of a victim as the rest of you.

UNIDENTIFIED MALE: We`re not seeking attorneys fees. You don`t seek -- and I have filed an appearance in this case. I`ve been asked to join and I`m doing it pro bono. So there`s no $1 million worry here.

C. ANTHONY: I`m not in control over any of this.

UNIDENTIFIED MALE: What we`re seeking is a confirmation of Miss Anthony`s indigency which is not being disputed.

C. ANTHONY: My entire life has been taken from me. Everything has been taken from me.

UNIDENTIFIED MALE: Miss Anthony is, in fact, indigent. She`s been in jail for close to two years. No assets, no money.

LAUREN HOWARD, PSYCHOTHERAPIST: If, in fact, George did say to someone whom he was having an affair with, this was a terrible accident, that does not mean he has knowledge of it.

UNIDENTIFIED MALE: George did not ever tell River Cruz that he knew what happened and that this was an accident.

HOWARD: There`s all this smoke, there`s all this mess, there`s all this noise.

BILL SHEAFFER, DEFENSE ATTORNEY, WFTV LEGAL ANALYST: The bottom line is that George made this statement that the child was dead one month before the body was found when in public he`s professing that the child has been kidnapped.

HOWARD: What does a jury think if, in fact, this information is presented to them?

SHEAFFER: That shows that either he had direct knowledge of that death of the child or that the killer confided that information to him, that the child was dead. And the only person that has that relationship with him is the mother.

UNIDENTIFIED MALE: My problem is you`re seeking public funds and tried to punch and get out of the way at the same time. You know? You want these funds but I don`t have much about the source of what happened in the past and where that money went so --

UNIDENTIFIED MALE: I`m not seeking any public funds today, Judge. As I said, the lawyers are appearing pro bono. So therefore it`s nobody`s business about what we`re doing or not doing, unless you can show that money previously paid was used improperly.

I thought you already had a hearing on that. And if you haven`t had enough on that then I`ve got Mr. Baez and Miss (INAUDIBLE) here for the purpose of providing that information.

UNIDENTIFIED MALE: And then you too. The court doesn`t question her indigency now. There`s just a road map that we have to go through.

(CROSSTALK)

UNIDENTIFIED MALE: We can`t take any detours.

(END VIDEO CLIP)

NANCY GRACE, HOST: Today, in court, just a couple of hours ago, tot mom shows up, admits in front of all of her lawyers in a packed courtroom that she has bagged over $250,000 so far since the death of her little girl Caylee. And then says she`s broke. That she wants you and me to pay for her multimillion dollar defense.

Also we find out what that volatile state`s evidence is that they have kept secret up until now. It is allegedly 50-plus handwritten letters by tot mom, secretly passed, apparently by a jailhouse insider, to another female inmate.

What is in those letters?

We know the state wanted to keep it quiet. Many court watchers believe so they could get their hands on the letters before they could be destroyed.

We are taking your calls live. Back out to Jean Casarez, correspondent, "In Session." Before we unleash the lawyers, Jean, what else happened in court today? I saw tot mom laughing. What was funny?

JEAN CASAREZ, CORRESPONDENT, "IN SESSION": Well, I think she was enthralled with her new lawyer. There is a new defense lawyer on the team. His name is Cheney Mason. He is one of the most respected defense lawyers in the state of Florida. Death penalty qualified, Orlando based, covered many cases.

Nancy, you and I on CourtTV followed many of the cases that he covered. He`s now a member of the defense team.

GRACE: And I understand he`s hopping onboard pro bono, for free.

CASAREZ: That`s right. He`s very close to retirement, and he decided he wanted to do the case. He said in a press conference he wanted to do it. And he thinks it will be fun. He doesn`t have to do this case. He`s had a very, very long career, but he wants to get involved.

GRACE: Let`s unleash the lawyers. Joining us tonight, expert in Florida law, Bill Sheaffer, former prosecutor, WFTV legal analyst, Renee Rockwell, veteran defense attorney, handling felony cases out of Atlanta. And out of New York, practicing in multiple jurisdictions, along with the other two hours, Mickey Sherman, defense attorney, author of "How Can You Defend Those People?"

First to you, Sheaffer. Surprised about the turn of events today?

SHEAFFER: Absolutely not surprised. And I`m going to tell you something. We as the citizens of Florida should hope that the judge does grant this motion for cost and that the taxpayers do pick it up.

And by the way, I`m one of those taxpayers. And here`s the reason why. Do we really want to deny her cost of investigation of this case so she that gets convicted and on appeal she raises the issue of ineffective assistance of counsel, denial of due process because the court refused to grant her indigency status?

It`s going to happen.

GRACE: Renee Rockwell, if you screw up at trial level, then you can look forward to retrying the case all over again, which would be double the tab.

And listen, I don`t want who hear either one of you defense lawyers start up about the cost of a death penalty trial, all right? Because this is not about a price tag. This is about seeking justice for the brutal murder of a 2-year-old little girl.

And Liz, in the control room, all you`re showing me are pictures of tot mom laughing and yakking it up in a new outfit in court.

This case is about 2-year-old Caylee Anthony. I want to see her, all right? Can you hear me, Liz? Good, I`m glad your hearing is fine.

To you, Renee Rockwell, how many times have you had a client that yaks behind bars? I couldn`t be happier. You know, before every trial, Renee, I would make a point to visit myself, not an investigator, myself, to the cellblock where the defendant had been housed to find out if he had been talking. Any casual conversations about his guilt.

Now we hear that there are 50-plus handwritten letters to a female inmate. Thoughts?

RENEE ROCKWELL, DEFENSE ATTORNEY: And, you know what, a nightmare. Because all of those jailhouse rats that are going to talk about what the defendant said, that`s one thing. And you can challenge their credibility.

But Nancy, when you have notes, all they have to do is establish that the notes were written by Anthony and then they`re coming in.

GRACE: And, you know, Mickey Sherman, I was wondering, a lot of us were speculating, I had never heard of the state saying look, judge, we`ve got some evidence that is so volatile, so explosive we can`t reveal in open court what it is right now.

We`re investigating it. We want to go in camera, in the judge`s chambers, in secret to tell you what it is, because we want to keep it secret for a few more weeks.

I`ve heard of the defense doing it. They always claim to have secret evidence. I have never seen the state do it until now. And now we find out what it is. Have you ever seen anything like it?

MICKEY SHERMAN, CRIMINAL DEFENSE ATTORNEY, AUTHOR OF "HOW CAN YOU DEFEND THOSE PEOPLE?": No, but also you`re dealing with the state of the prosecution where we see everything all the time anyway. I mean they flood us with information besides the videos of her chatting away with her family. We`ve been shown every bit of evidence.

GRACE: The prosecution is not doing that. And I don`t -- you know --

SHERMAN: No, no, no.

GRACE: Look, if she wasn`t on video yakking and moaning about her plight behind bars, nothing about Caylee, nobody would be looking at it. She is creating this. The state is not creating it for her. She`s doing it all on her own.

SHERMAN: But the state is producing it. They`re giving us these things. Not the defense.

GRACE: So?

SHERMAN: Well, maybe we should wait and let her get a fair trial. And you know -- of these notes are any of them incriminating?

GRACE: Listen.

SHERMAN: Are there any confessions?

GRACE: I`ve got two syllables for you, Mickey Sherman. O.J. Did you ever see a case that got as much pretrial publicity and they still got an acquittal on a double murder that he obviously committed.

SHERMAN: Yes, but then --

GRACE: So --

SHERMAN: But then they played catch-up in Las Vegas and nabbed him for that.

GRACE: Oh, I knew you would have a little second verse same as the first.

Out to the lines, Carolyn in Canada. Hi, Carolyn.

CAROLYN, CALLER FROM CANADA: Hi, Nancy. How are you today?

GRACE: I`m good, dear. What`s your question?

CAROLYN: Well, I have a quick comment and a question. Firstly, I think we all assumed that George Anthony`s suicide attempt was a grief reaction to --

GRACE: Yes.

CAROLYN: -- evidence implicating Caylee`s murder. My question is -- and, oh, before that, did anyone ever ask George really why. I think we all made assumptions. My question is, has anyone looked into the possible correlations with George`s suicide attempt and the possibility that Cindy learned of his possible indiscretions at that time?

GRACE: Good question. Ellie, you have very carefully taken a look at this timeline as to when this woman -- whose family came on here and swore the story hadn`t been sold. Twenty-four hours later, bam. Here it is. "National Enquirer." "I slept with George Anthony and he told me all about what happened when Caylee died."

We don`t know whether we believe this or not. But what about the timeline as it relates to George`s suicide attempt?

ELLIE JOSTAD, NANCY GRACE PRODUCER, COVERING STORY: Well, Nancy, that suicide attempt happened well after this affair allegedly started. And George`s suicide attempt I believe was after Caylee`s birthday, which was apparently -- which was at the point in which that he and this woman broke up.

And it`s not clear at this point, there`s no indication that Cindy Anthony thought anything was going on. And again, George says this affair never happened.

GRACE: And another thing about this "Enquirer" article, Ellie Jostad. You know, the "Enquirer" usually has all the text message, all the photos, you name it. They have one photo of them in public together at a vigil- type event for little Caylee. And one text message.

That`s it. And I`m supposed to believe she had an affair with George Anthony?

JOSTAD: Well, right, Nancy. And the attorney for George Anthony says this picture was taken at the vigil. They were there together but there`s nothing incriminating in that picture.

GRACE: Well, of course, we could both end up with egg on our face, Ellie, when all the photos and text messages if they exist come out.

We are taking your calls live. To tonight`s alert. The reward climbed in the search for a Baltimore woman, 24-year-old Cherice Ragins. Last seen Feb. 21 on her way to the (INAUDIBLE) Ville area, Baltimore suburbs. She`s never seen again.

Take a look. The reward, $4,500 and rising. Last seen wearing gray sweats, a red hoodie over a black shirt, green and pink shoes, black purse, silver trim.

Please, take a look at this young lady. If you have info, call 1-866- 7-LOCKUP.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: All rise.

C. ANTHONY: I just wanted to let everyone know that I`m sorry for what I did. I take complete and full responsibility for my actions.

UNIDENTIFIED MALE: Miss Anthony is indigent.

UNIDENTIFIED MALE: Indigent. Defend her.

UNIDENTIFIED MALE: Her being declared indigent.

UNIDENTIFIED FEMALE: Everyone knew that Casey lied.

C. ANTHONY: In my gut, she`s still OK.

UNIDENTIFIED FEMALE: What was the truth, we didn`t know.

LEE ANTHONY, CASEY ANTHONY`S BROTHER: I believe everything that my sister tells me.

CINDY ANTHONY, CASEY ANTHONY`S MOTHER: There`s no evidence that Casey has ever done any harm to her child.

JOSE BAEZ, CASEY ANTHONY`S ATTORNEY: Everything the defense has done in this case has always been 100 percent honest.

GRACE: Reports surfaced, grandfather George Anthony not only starts an affair --

UNIDENTIFIED MALE: George Anthony telling his alleged mistress River Cruz that he knew Casey killed her daughter Caylee.

UNIDENTIFIED MALE: She claims he said it was an accident.

G. ANTHONY: I believe in my daughter.

UNIDENTIFIED MALE: It doesn`t make any sense.

G. ANTHONY: What can I say? You believe your child.

UNIDENTIFIED MALE: And you didn`t say it.

G. ANTHONY: I got within three feet of my daughter`s car and the worst odor that you could possibly smell in this world.

C. ANTHONY: You`re not helping me help myself.

(END VIDEO CLIP)

GRACE: We are taking your calls. Out to Dr. Bethany Marshall, psychoanalyst and author of "Dealbreakers." I want you to take a look at this video that Liz is showing you, it`s just a couple of hours ago, of tot mom in court today. On several occasions -- that`s not in particular what I`m talking about. We will get to it.

On several occasions, she breaks out and starts laughing.

BETHANY MARSHALL, PSYCHOANALYST, AUTHOR OF "DEALBREAKERS": I think she has a complete inability to grasp the reality of the situation in which she finds herself. The affect is inappropriate, right? But it`s been inappropriate all along.

Dancing on a stripper pole when her child has gone missing. Hanging out with her boyfriend when she should be mothering. And in this case bursting into laughter.

What is she so happy about? Maybe the fact that the state might pay for her defense. Maybe the fact that there`s always this perceived male attention or that this very important attorney is going to be taking the case on pro bono.

Kind of makes her feel like she`s in control and pulling the strings. It`s like it`s Casey`s world and everyone else is just living in it.

GRACE: You know, while I`ve got you, Dr. Bethany, I want to talk to you about this whole "Enquirer" article. Let me just grab it.

MARSHALL: Yes.

GRACE: Not so much the "Enquirer" article itself, but you know, the "Enquirer," everyone scoffs at tabloids, but -- they have been sued in the past and they`ve got quite a fleet of investigative journalists.

They don`t want to get sued again, all right, by printing something that`s not true. And this woman is in here making these claims. What do you make of them? Because when I had the family on, they said oh, no, we haven`t sold a story to the "Enquirer." I don`t know anything -- in 24 hours, here it is. And a lot of other -- let me just say inconsistencies.

MARSHALL: I read all the wires, Nancy. Both of these women have a criminal history.

GRACE: It`s not that -- look, you`ve got to take it with a box of salt, Dr. Bethany.

MARSHALL: All right. All right.

GRACE: You know, when you say criminal history, I prosecuted felonies my whole legal career, practically. And I think, you know, murder, rape, child molestation, drug trafficking. Come on.

MARSHALL: Let`s think about for a second --

(CROSSTALK)

GRACE: Arrested for check fraud? Arrested for refusing to sign a traffic citation?

MARSHALL: OK. Let`s think about for a second.

GRACE: I`m very underwhelmed, Bethany. Underwhelmed.

MARSHALL: OK. However, from my vantage point, if it was theft, burglary, and what are they doing? They`re stealing his reputation.

GRACE: OK. The other one -- the other one does -- Skye Benhaida, actually does have attempted burglary, forgery. A couple of convictions. They`re not violent, but Benhaida does have a couple of convictions.

MARSHALL: OK. So they`re taking something that`s not theirs to take. Right? And what do they do? They steal his reputation. They insert themselves into the notoriety of the situation.

It`s a quick way to make a buck. Sure, there may have been an affair of the heart. Did he engage in inappropriate behavior? Perhaps. I don`t think there`s any evidence that there`s been an affair at this point.

And these two, you know, they gratify -- they gravitate towards this situation that has all this national notoriety and if they insert themselves into it, then they come to the forefront publicly. I think that that is really what all of this is about.

GRACE: Well, another issue about it -- let`s unleash the lawyers again. We`ll go back to the lines. Bill Sheaffer, Orlando, Renee Rockwell, Atlanta, Mickey Sherman, New York.

All three of you have seen your share of high-profile trials. But there have been a million witnesses that sell their story to the "Enquirer" or other tabloids.

Do I have to say Kato Kaelin? O.J. Simpson? Then a whole -- all the state`s witnesses, a ton of them, had sold their story. And I`ve got to tell you, Mickey Sherman, it does hurt their credibility, even if they`re telling the truth.

SHERMAN: Remember at the beginning of O.J. that Rosa Lopez, when she sold out to $5,000.

GRACE: That`s the one. Yes.

SHERMAN: Remember that one?

GRACE: Yes.

SHERMAN: And that was kind of -- that was the linchpin. And they immediately threw her to the side and said we can`t use her anymore. But then unfortunately --

GRACE: Yes, you know what? I think you`re right. I`m not sure that it was Kato Kaelin. I think you`re right. It was Miss Lopez.

SHERMAN: No, it was Rosa Lopez.

GRACE: Hold on, everybody. We`re going to break. As we go to break, I want to say get well to Hardwick Butler. A local Boy Scout, leader for years. He helped me as a little girl with my 4-H project. I won that year.

He is just back from surgery at the Mayo Clinic, and I want to wish him the best wishes.

Get well soon, Mr. Butler.

(COMMERCIAL BREAK)

GRACE: Straight out to bounty hunter Leonard Padilla joining us out of Sacramento via Skype.

Leonard, what do you make of them running through a quarter million dollars, asking the public to pay for her tab, and now the handwritten letters to a female inmate?

LEONARD PADILLA, BOUNTY HUNTER, BONDED TOT MOM OUT OF JAIL; SPENT TIME WITH THE ANTHONY FAMILY: Well, the handwritten letters, that`s typical of anybody that`s in prison. They always communicate with other people trying to get past the guards, trying to get past law enforcement, trying to just be sneaky about it.

As far as the payment of costs involving the defense, that`s basically customary. Now, whether the judge will allow it for specialists and individuals to come from out of state, that`s a horse of a different color.

But as far as the attorneys, if they`re not getting paid, if they`re pro bono and it`s just their expenses and costs, unless somebody tries to pad the bill with office rent, personal telephone calls, car payments and things of that nature because they`re necessary for the defense, I think the judge is going to take a very, very strong look at that.

And besides, Nancy, I have a J.D.

GRACE: You --

(LAUGHTER)

GRACE: Leonard Padilla, you were around George Anthony for quite some time at a very intense time in their family`s life when Caylee had gone missing, her body hadn`t been found yet.

PADILLA: That`s correct.

GRACE: What do you make of the claims by this woman that not only did they have an affair after Caylee goes missing but that he tells her it was all an accident at the hands of Casey?

PADILLA: No. If there was an affair, it was prior to the incident that we`re talking about as far as the 15th of June. If there was an affair with this woman, it was long before. It wasn`t afterwards. I can tell you that. It just did not take place.

And the woman`s background will tell you that she`s kind of scratchy and, you know, she`s got a lot of stories she tells in the past. And that has to be taken in. At the same time that you`re listening to this, you have to look at her past and see that she`s not even using her real name as far as when she was in New York versus now that she`s in Florida.

George did not have an affair with that woman after Casey went missing. Excuse, after Caylee went missing. I can tell you that.

GRACE: Well, Florida taxpayers, buckle up, because you are in for quite a bill.

Let`s stop and remember Army Corporal Dustin Brisky, 26, Round Rock, Texas, killed Iraq. Awarded the Bronze Star. Loved golf, drawing, art, playing cards, dominoes with relatives. Dreamed of being an architect. Leaves behind parents Bob and Karen, stepfather Bob and brother Nicholas.

Dustin Brisky, American hero.

Thanks to our guests, but especially to you for being with us. I`ll see you tomorrow night 8:00 sharp Eastern, and until then, good night, friend.

END