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LEGAL VIEW WITH ASHLEIGH BANFIELD

Detailing the Flooding in Texas; Oil Spill Closes California Beaches on Holiday Weekend; Washington, DC, Murder Investigation Continues; GM Looking at Big Fines over Ignition Switch Scnadal. Aired 12:30-1p ET

Aired May 25, 2015 - 12:30   ET

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


[12:30:00] (COMMERCIAL BREAK)

KATE BOLDUAN, CNN HOST: At least 12 people, at least a dozen people are missing today from ranging flash floods that roared through Central Texas.

The Kendall County Sheriff, say an elderly man narrowly escaped this. Wow, SUV just before it was swept away about they (inaudible). The news conference a short time ago, Hays County emergency officials warn that local communities there. They're not yet out of danger.

UNIDENTIFIED MALE: Oh my God. Oh my God.

(BEGIN VIDEO CLIP)

KENNETH BELL, HAYS COUNTY TEXAS OFFICE OF EMERGENCY MANAGEMENT: There are still rescue operations in play. We're going to keep it in a rescue posture especially with today's impending rains. We're looking it about two inches of the new an hour.

(END VIDEO CLIP)

BOLDUAN: Wow. The weather system that's bringing that new round of rain has already brought on one deadly tornado in Mexico just across the border from Del Rio, Texas, at least 11 people are reported killed and about 300 homes were damaged there.

Greatly complicating rescue efforts in the flood ravage areas of Texas are scenes like this. A bridge near the town of Wimberley that's normally, that normally sit high above the Blanco River was no match with the wall of water that seem to slammed into it yesterday, up to 400 homes were also washed away. One person is confirmed dead, two others including a firefighter lost their lives due to the flooding in Oklahoma.

CNN Alina Machado is joining us from Wimberley with the very latest. Alina it looks like a mess from the pictures from high above in helicopters and it looks like a mess behind you as well, what do you hearing?

ALINA MACHADO, CNN CORRESPONDENT: Yes Kate, it's an absolute mess. And before we show you the damage, I want to show you see this? It's raining which is exactly what people here don't want to see. But this is what we have been seeing--the more we walk around the area of destruction, this is what we see, piles and piles of tree debris mixed with pieces of people's lives. There's a refrigerator. There's also -- we're seeing child's life vest and other -- there's a mattress on the other side, even a chair.

And if you walk with me on this side, you get a better sense of just how bad the damage is. We need to be careful because it's kind of rough over here. But look at that, that is what's left of a house that was right on the river partially destroyed.

That over there is the Blanco River. That is the river that everybody keeps talking about. That's the one that reached record levels of more than 40 feet high. The damage is absolutely incredible. Look at this on the other side of this bridge, a house, also with the roof torn off. On the other side of this house and I don't know if you can see it because we're limited in terms of where we can be, there's a house that is now gone.

That is the kind of damage and destruction, Kate that we are seeing here in Wimberley, Texas. One of the hardest hit areas during this flood.

[12:35:00] BOLDUAN: And you pointed out, Alina, not only if they already faced record amounts of rainfall, it's now raining where you are at this moment. The threat is not over and it's important to point out to a lot of folks.

Alina, thank you so much to pointing out to our viewers.

The people at least 12 people still missing in one county there. The threats not over, the rescue operations are not over on this Memorial Day and so exactly that point. If you want to help those who are affected by the storm, please visit our website CNN.com/IMPACT to see how you can help out.

Coming up next for us, instead of beach towels and umbrellas, its Hazmat suits at this beach.

This holiday weekend there's 9 mile stretch in Southern California, the oil spill quickly becoming an economic and legal nightmare as well as an environmental disaster.

(COMMERCIAL BREAK)

BOLDUAN: Over the long Memorial Day weekend, two beaches are closed because of the Santa Barbara oil spill and they will stay close until next week. You're looking right now at live pictures of the beach. Only people there are wearing Hazmat suites.

The closures are inconvenient, to say the least, for beachgoers but most importantly also for business owners that has meant a loss of some major revenue on a big weekend. Stephanie Elam is taking a look at the impact there on Santa Barbara's economy.

(BEGIN VIDEO CLIP) [12:40:01] GARRETT KABABIK, OWNER, PADDLE SPORTS CENTER: It's a keen to somebody potentially getting hit by a shark in the water. You see everybody just goes away.

STEPHANIE ELAM, CNN CORRESPONDENT: For Garret Kababik, the oil spill in Santa Barbara County couldn't have come at a worst time.

His Paddle Sport Center at the Santa Barbara Harbor should be bustling with customers who want to get out and paddle board or kayak.

KABABIK: We generally would not be able to do this interview, for wherever we are standing right now, if it were a normal Memorial Day weekend. There would be 50 or 60 people trying to get in the water in and out.

ELAM: Instead, business is slow.

How much has your business been impacted, this Memorial Day weekend? Do you estimate the cost of the spill?

KABABIK: At this point, we can estimate ten to tens of thousand of dollars of loss revenue.

ELAM: The spoil spill that leaked more than 100,000 gallons of crude oil into the Pacific Ocean has impacted a 9 mile stretch of the coastline, forcing Kababik to close his other shop in Goleta.

KABABIK: There was oil on the water.

ELAM: You guys just see it.

KABABIK: We can see it.

ELAM: So...

KABABIK: It was actually covering the bottom of our kayak.

ELAM: Here in Santa Barbara Harbor, several miles south of the spill, there's been no sign of oil, but the perception that there might be has been enough to dump in this area's economy and it's one that thrives on tourism.

DOREEN FARR, SUPERVISOR, SANTA BARBARA COUNTY: Obviously, people who have reservations at the state camp grounds and our local community that is used to being able to go out and used the beaches, use the ocean, surf, fish, kayak, or whatever, have been greatly impacted by that.

KABABIK: We're (inaudible) in business. We don't have very many days to make our money. So, having this happen in the time we're expecting good revenues is tough.

(END VIDEO CLIP)

BOLDUAN: Stephanie Elam is joining me now from Goleta, California. So Stephanie, you're talking about the economic impact for the businesses but also, I want to talk about the impact that you're seeing, if you will, on clean-up work, the efforts that underway behind you. You were there last week, you're there. Have you seen -- are you seeing progress? What are you seeing there now?

ELAM: Well, that's, yes Kate, it sort of a long drudgeries process to do this because you have to go through -- they're cleaning out little bits of the sand, to see if there's anything there along this strip of this beach here.

But what it's harder to see, that translates on camera, is this strip of rock that is all covered in tar, little drips of it, around it, and it's sort of this dark shaded area here that they're now starting to look at. There are some booms that are still out in the water.

But overall, Kate, I can tell you, from when we were here last week to now, the smell is a lot less ponging. You don't have that nagging headache that you're getting from the smell. So they've definitely been working on it.

And based on what we've seen, they've been able to clean out a lot of the oil. The rest of that on the water, on the surface, they say it's too small to collect, and that's going to naturally evaporate.

BOLDUAN: The progress being made there, but also progress and so obviously, the big question of how and why did this happen on that beach.

There's a lot of talk right now about this pipeline, the pipeline that rupture, that it didn't have some kind of auto-shutoff valve, an auto- shutoff mechanism that many pipelines are required to have, especially in California. What are you hearing about that?

ELAM: There's been so much talked about that, and even when you're just out in Santa Barbara, Kate, you hear people. There was also protest we saw, where people don't want this offshore drilling. They don't want to see these platforms out of the coast here, in the Pacific Ocean. They don't want there to be these pipelines. And a lot of people wondering why weren't there -- these shutoff valves.

So these people are coming out over the holiday weekend to make their voices heard about that.

Well, what it's interesting is now we've heard from Planes All American Pipeline, and that's the company that owns the pipeline that ruptured. And they're saying that that would not exactly work in this case because if it's just automatically shutoff, there could be pressure in the pipe that builds up and there could be a rupture some place else. They're saying it makes much more sense to slow down or have controllers, people actually out there slowing it down in a step by step process so that you don't have a rupture somewhere else along that line.

That said, the government is now taking a look at their process, watching what they're doing, having them removed the oil from pipe, which they've already began doing. And then they're going to have to remove that part of the pipe and examine to figure it out why it ruptured. And figure it out what needs to be done so this doesn't happen again, Kate.

BOLDUAN: The investigation -- well, that investigation clearly is going to continue and probably going to take a little while now.

Stephanie, thank you so much. We'll get back to you as we can.

We're going to have new information though after the break.

We're going to have a new information on a breaking story right off the top about that flight that had a direct threat coming to it. Some reports, it was a chemical weapon threat. But I'm going to update on the status of that investigation right after this.

(COMMERCIAL BREAK)

[12:48:09] BOLDUAN: An update for you on the story that we brought to you is breaking news at the top of the hour regarding that Air France flight that was brought into JFK investigated over a threat on that flight.

What we've now learned, CNN has learned, that a number of threats had been received today, this, according sources close to the matter against airline flight, in general. None of which have proven legitimate so far. That's important, because you take that in light of the environment that they were receiving the environment of the day.

And as for that Air France flight escorted to JFK by fighter jets, one source tell CNN that was because the flight didn't respond right away to authority who are reaching out to what regarding some of those threats.

Important to note though, at this moment, the source says that there is very low level of concern regarding that specific flight. That flight did land safely earlier today, and investigation though continues.

But important to note, to bring up to date, low level of concern regarding that flight, regarding that flight.

Other big story we're watching today, police in Washington, they are not yet closing the books on the home invasion murders of an aphelion (ph) family and their housekeeper. This was a week and a half ago now.

They say that the horrors that culminated in the torching of this lavish home near Embassy Row in Washington D.C. "Required the presence and assistance of more than one person," although one person currently locked up and charged with first degree murder is Daron Dylon Dennis Wint arrested after a multistate manhunt on Thursday.

Our justice correspondent, Pamela Brown, she's joining us now with the very latest on this. So obviously, they have one person behind bars.

Pamela, they think there could be more. Where are they in terms of the search for those others?

PAMELA BROWN, CNN JUSTICE CORRESPONDENT: Absolutely. Well, D.C. police continues to investigate and hunt for more suspects. And we know, Kate, from witness interviews by police, recently (ph) even more suspicions of the alleged home invader Daron Wint was not out seen alone.

[12:50:02] And it also to raise a new questions about the family's assistant, a witness, according to court document, who claimed to have seen the Savopoulos family blue Porsche after the grizzly murders, says that the driver had short well-groomed hair, that is a very different description from Daron Wint who showed up in court Friday with medium length dreadlocks.

Also we have learned the Savopoulos family assistant, allegedly changed the story several times during police interviews about dropping on $40 thousand to that family's home, the assistant initially told police that Mr. Savopoulos directed him to pick up the package on Thursday. But then later told police that it was actually the day before he was told.

The assistant also had allegedly said the door to the family's red car where, he was instructed to put the package in was locked. And then later came back and said actually it was unlocked. And the assistant allegedly said he was given a manila envelope with the cash and then later admitted that he lied and instead put four bundles of cash into a red bag.

Court document show that police interview did unidentified second witness who said the assistant texted a picture at 9 A.M. Thursday morning of a red bag with only two of the four bundles of cash.

Four hours later Kate we know that home, the family's home went up in flames. So there's still a lot of unanswered questions here.

BOLDUAN: All right and that story is just tragic and horrific, it's almost too difficult to believe that it is true. But we continue to see the investigation playing out right now.

Pamela, thank you so much, for that update on that.

Coming up next, a problem that could have been fixed for some 57 cents, for now end up causing General Motors more than a billion dollars, not to mention, possible criminal charges

(COMERCIAL BREAK)

[12:55:24] BOLDUAN: New legal trouble for General Motors over a faulty ignition switch, that would've cause, they believe 57 cents, a car to replace, that's a lot of cars, but that would be have saved a lot of lives. Instead a New York Times report, says GM will face criminal charges and perhaps even pay out more than a billion dollars for its failure to act sooner.

At first GM estimated the faulty switch was linked to as few as 13 decks, but now we know that it's tied to at least a hundred fatalities.

New York Times says, a settlement that with Department of Justice could come to summer, and it could be one for the record books.

The DOJ isn't commenting, but GM did give CNN a statement saying this in part, saying, "We are cooperating fully with all requests. We are unable to comment on the status of the investigation, including the timing." Let's discuss what these really mean.

So CNN Business Correspondent Alison Kosik is joining as us as well and CNN Legal Analyst and Defense Attorney Danny Cevallos.

So Alison we're talking about we could -- we're talking record dollar amounts here, but what could this mean for GM.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: So already GM has felt the sting of what's happened because in the first quarter of last year, it pretty much wiped out their profit for the first quarter. But funny enough, by the end of the year, GM made $4 billion, that's even after paying out $4 billion for the recall.

I mean you're looking at a $57 billion company, this is one of the -- this is the biggest auto maker, American auto maker here. And GM is one of the 40 most profitable companies here in the U.S. But the big question is what's going to happen now, what kind of fine if the DOJ going to impose on GM, will give the DOJ, want to make a poster child, out of GM...

BOLDUAN: It was an example

KOSIK: Exactly, you know, you look at, how did the DOJ handled the Toyota recall, Toyota actually paid the highest of penalty of $1.2 billion. The big question is will GM pay more?

BOLDUAN: And GM might even top that. So you're talking a lot about, obviously we're talking about a corporation, so we're talking about the bottom line and the financial hit to them. But Danny they're talking criminal charges against the corporation.

What did -- how is that possible, what does that mean?

DANNY CEVALLOS, CNN LEGAL ANALYST: Well we know you can't put a corporation in prison. So the idea of a criminal prosecution against the corporation is a bit of illegal fiction however what it really means, is that the Department of Justice goes to a corporation and says, "Listen unless you want us to prosecute you publically, pay us a lot of money, you can enter into a differed prosecution agreement where we will put the prosecution of pause until, we unless and until we like what we see, which is a lots of fines and lots of monitoring. Now in the past the DOJ is allowed corporations to go into these differed prosecution agreements. But it seems that times are changing.

In the last year alone, they have started having these corporations instead of avoiding prosecution all together with an agreement, actually plead guilty, which can have very serious collateral consequences and appears the DOJ is not very concerned about those collateral consequences.

BOLDUAN: Talking -- another consequences that there are also, there is some consideration they could charge, not only -- we're talking about the corporation, but individual employees could face criminal charges. How did that play on this?

CEVALLOS: Definitely that's another sort of paradigm ship, we only seen the last years so that the DOJ, not only is forcing this corporation to plead guilty. But also to cooperate and give them names of individuals within the company that maybe responsible but then since we're sort of on new ground, it creates a thorny issue, how do you prosecute individual employees in the chain of command, when the most obvious defense is going to be the guy above me told me to do it.

BOLDUAL: But well in, take it from the other perspective, you're talking about a 104 deaths, these families who are looking -- many families who are looking for justice in their eyes. What this is -- what would all of this mean for individual wrongful death cases.

CEVALLOS: Plaintiffs and plaintiff's attorneys are watching this case closely, because as, as usually the case, a criminal prosecution can help a civil case by creating more discovery, these plaintiffs attorneys may help with the DOJ uncovers more discovery than the plaintiffs, would've gotten on their own.

And that can certainly help their case. But remember that at least one other judge has cut off some of the liability in terms of prior to 2009 in these cases. So it's not going to be carte blanche for all plaintiffs attorneys in this case.

BOLDUAL: And Alison, real quick timing wise, the times are supporting if -- it could happen to summer is there...

KOSIK: Settlement could happen as early as this summer, this is something that GM wants to get out of the way, anyway get off the headlines.

BOLDUAL: Well it's not going to leave the headline, though were going to be covering it.

Alison, it's great to see you, thank you so much Danny, it's always great to see you, thank you as well.

[13:00:01] Thank you all for watching Legal View, it's great to see you. Have a good Memorial Day (inaudible) takes it from here.