This is a partial transcript from "Hannity & Colmes," March 7, 2005, that has been edited for clarity.

ALAN COLMES, CO-HOST: Welcome back to "Hannity & Colmes." Earlier Sean sat down for an exclusive interview with talk radio host Howard Stern, his first one since his former employer CBS filed a multi-million-dollar lawsuit against him.

(BEGIN VIDEOTAPE)

SEAN HANNITY, CO-HOST: Breach, unjust enrichment, misuse of broadcast time, 14 months you plugged Sirius — you hid the cause that accelerated your subscriber initiatives, and you're being sued. And you're mad?

HOWARD STERN, RADIO HOST: Well, at least I didn't kill anyone, right? No, I am mad. You know, people had said to me, you know, this is a great wave of publicity.

I was watching FOX News. Almost every show had a legal expert on saying the lawsuit was a bunch of baloney. I watched the other cable news channels. I got all the reports. Everyone says this lawsuit is a bunch of baloney.

Yet, when you're sitting there — I'm an individual — and you're being sued by the CBS corporate and Les Moonves, these guys are taking the stockholders' money, CBS stockholders' money, and they're going to file a frivolous lawsuit — you know, we could get into a million speculative reasons why they're filing this thing. I have a few thoughts of my own.

But they're going to file a lawsuit against me and, you know, and come after me. It's all fun and games. I, on the other hand, have to go hire lawyers and defend myself about accusations like that.

HANNITY: Yes. Well, you say this is sour grapes. You say it's bullying, it's intimidation. You're not going to let them bully you. How are they trying to bully you?

STERN: Well, first of all, Les Moonves, I met with him before they filed this lawsuit. And I said, "You're going to look like a fool. This is an idiotic lawsuit."

And he just kind of sat there. You know, he's got capped teeth, and he's got a lot of Botox, I think. You can't read the guy's face because of the Botox. And he sits there with his suit, a very expensive suit, arrogant attitude, and he says, "I'm going to file this lawsuit."

And I said, "Hold it a second. Wouldn't you be better served worrying about your radio division and what's going on there than filing frivolous lawsuits against me?"

I said, "Why would you want to spend any part of your day worrying about me?"

He goes, "Don't worry about it. I don't worry about you. I'm not going to worry about this lawsuit at all."

HANNITY: Were you ever told, "Don't mention Sirius"? Where you told that they were cutting out the word "Sirius" every time you spoke it? Did they have control of that?

STERN: When I signed my deal with Sirius, I spoke to Joel Hollander. Joel Hollander is the president of the CBS radio division. And we spoke. And he said, "I don't want you to mention Sirius at all."

I said, "OK. Done deal. Whatever you want me to do, I'll do." I said, "I can make a counter argument to that." I said, "You know, every news outlet, every show is talking about the fact that I'm going to Sirius. It's a big story. What if we do talk about it? I have always talked about everything going on in my life. When I put out my movie, I spoke about it. My books — anything goes. I'm an open story." I said, "It will drive up ratings. It will increase profits. You have 14 months left. Why should we let everyone else talk about it?"

And he said, "You know what? That makes sense. Let me think about it."

HANNITY: Right.

STERN: We spoke the next day. He said, "I have no problem with you mentioning Sirius Satellite Radio on your show."

They had seven delay buttons because of my situation with the FCC. They have seven delay buttons.

HANNITY: Seven seconds each?

STERN: Yes. In fact, if you added them all up, some of them were more than seven seconds. I think I was on a seven-minute delay. They could have hit the right...

HANNITY: Hit the button.

STERN: That's a record. They could have hit the button any time.

And they had a Def Con 4 button. You hit that button and they go to music. So if at any time they didn't like what I was doing, they could pull me right off the air.

HANNITY: Who had control of all those buttons?

STERN: Tom D. Sutton, the general manager, CBS legal. They also had another guy, a guy named Dave who was in charge of it. There was a lot of people in charge of my show.

HANNITY: But in the end, this helps Howard Stern. It brings more attention to your new gig, what you're doing — this doesn't really hurt you.

STERN: You say it doesn't hurt me, but people have said to me, this is going to bring you more attention.

HANNITY: It does.

STERN: And it's true. Absolutely. And if more subscribers come to Sirius and I've got my own television channel now, On Demand. If this lawsuit brings more people to the table, great, because I think we've got a good product. I think we've got a good show going on.

But it causes me personal angst, because I take something like this very seriously. I consider my time at CBS a time of great loyalty from me. I always gave my all to this company.

Les gave me his blessing, go on the air, he made record profits, and now he wants to sue me for doing what he told me to do. He should sue himself.

HANNITY: Let's talk about the timing of this. This came out the day after the extrapolated monthlies came out. Your replacement's not doing very well. The loss between 75 and 92 percent of your audience.

STERN: You're hitting this right on the head.

HANNITY: In New York what is the value of the stations beyond losing the revenue of the show?

STERN: Yours is a two-part question. And the first answer is this. This lawsuit was timed to come out around this huge loss. They just lost ratings like we've never seen in the history of radio before. Poor preparation, no work done, 14 months to prepare, and now they got socked.

This lawsuit was announced on the same day all you guys were preparing stories about how poorly the radio division just did. Instead, this story became "CBS Sues Howard Stern."

HANNITY: Distraction.

STERN: It was a distraction. It was a good move that way. Protect Les. Can't make him look bad. Let's not look bad here. So the first part is, this lawsuit was a distraction so that the stockholders will think Les is doing something.

(END VIDEOTAPE)

HANNITY: And we continue now with my exclusive interview with Sirius Radio's Howard Stern.

(BEGIN VIDEOTAPE)

HANNITY: You've had the FCC to battle with. You seem as passionate in terms of this lawsuit as you do with them. I talked to you the other day. You are genuinely really angry about this.

STERN: My lawyer has advised me not to say what we're going to be filing. We have to now respond to these papers.

HANNITY: Right.

STERN: As a matter of fact, Judge Napolitano gave me an excellent...

HANNITY: From FOX.

STERN: Yes, from FOX — gave me an excellent strategy. I was watching him, and he was saying that there is definitely a counter-lawsuit here. He didn't think the lawsuit had much credibility. So all of these experts are saying there's a counter-lawsuit and I happen to think there is, on a bunch of different levels. But I won't get into it just now. But I'll come on your show again when I do that.

HANNITY: All right. But what happens from here? So, you're just going to basically combat these guys — you hold back nothing, even though it's a lawsuit — don't most attorneys go to you, "Howard, don't talk! Howard, don't say a word."

STERN: I couldn't care what attorneys are saying. This is what I said to my attorneys: "I am not going to let these guys file a 40-page — 42-page document that's meant to intimidate me."

Now, how do they mean to intimidate you? They throw in words like, "a fraud," you know, "conman" — whatever it is, they throw in big legal terms. And then a headline comes out, "Howard Stern Sued — Fraud, Hundreds of Millions of Dollars, Misused CBS Airwaves" — blah, blah, blah, blah blah. Makes me look like a jerk.

What do we have besides our reputations, when you think about it? I'm a guy in business. My agent's a guy in business. They're mentioning our names in there, they're mentioning Sirius. They're saying we somehow misused CBS.

STERN: Look, I got the whole damn lawsuit in front of me, boiled down. It was a 42-page lawsuit. Here's what they said.

They said there was a secret agreement between me and Sirius. Everyone knew about my agreement with Sirius. You knew about it. The newspapers printed it. It was publicly disclosed. What that means is this company's a public company. Because of the deal, they publicly disclosed it. And on top of that, on the radio I've been talking about going to satellite radio for years.

How the hell could you say I had a secret agreement?

HANNITY: What...

STERN: That means Les wasn't listening to his own radio station.

HANNITY: Is he implying, with the secret side of this, is that the more you mentioned it, the more subscribers you got, the more accelerated your payment would be?

STERN: Right he's saying now there's a secret compensation. That's what he's saying.

HANNITY: Nothing's secret?

STERN: Nothing's secret. It was all publicly disclosed. And guess what? You know, this is shocking to Les. Sirius Satellite is a subscription based service. Yes, you know, that is the truth.

The decision was made on a corporate level. "Let's let Howard speak about satellite because it will drive up ratings. It's the media story of the year. We'll go out and sell advertising at a premium."

HANNITY: I want to play this tape two days before you left the air. The people you're talking about, Les Moonves and Joel Hollander, walk into the Howard Stern studio.

STERN: Right.

HANNITY: You pointed out right away, you said it was awkward because you were leaving in two days. You'd been there a long time. That was awkward for you.

STERN: Right. It was an emotionally draining time. After all, I was leaving. I spent 20 years with the company. That's what hurts me personally about this lawsuit. I put in 20 years in this company.

The last 14 months I was there, I could have pulled shenanigans. I could have called in sick. I could have not shown up. I didn't have to read all those live commercials. I could have screwed with them. I'm not that kind of guy. I'm a straight shooter. You hire me to do a job, I'm going to do it for you. And I've always been honest.

One thing about — you don't have to like my radio show. There are those that like it, and there are those that hate it. But one thing anyone who's ever heard my show knows, I'm a straight shooter, and I'm an honest guy.

HANNITY: This is what happened.

(BEGIN AUDIO CLIP)

LES MOONVES, CBS: I am a big fan, believe it or not. I've even gotten Sirius.

STERN: Really?

MOONVES: I have. I know I'm not supposed to do it.

JOEL HOLLANDER, CBS RADIO: You just got edited.

MOONVES: Only because of you. I got edited! We are rooting for you. Not that much, but we're rooting for you. We really are.

(END AUDIO CLIP)

HANNITY: "I'm a big fan," Les said. "I got Sirius." And what's interesting about that comment, once he said it, immediately somebody said — and I think it was Joel — "You just got edited," to imply that they did edit out, at times, the word "Sirius."

STERN: Yes, absolutely. What they used to do, if someone called in — sometimes guests would come in and say, "Hey, can't wait to hear you go to Sirius." They would hit the button.

HANNITY: Right.

STERN: So they edited me all along. Les, if he had such a problem with my show, as he claims in this 42-page document, why would you come on my show and say, "You did a great job. I am an owner of Sirius Satellite Radio, and I can't wait to listen to you every day."

HANNITY: He also goes on, "If they would have given me that kind of money, I would have left, too."

STERN: Right.

HANNITY: "I've been asking "60 Minutes" to do a piece on you for five years."

Joel said, "I don't think was a singular event, PR newspaper. You did a really unbelievable job. We are rooting for you. We really are." That's what they said.

STERN: This is going to be the crack in the cosmic egg for Les Moonves. This guy has gotten a free ride because the television ratings have been good. They put him in charge of the entire company, radio and television. And now, people are going to see what this guy's up to.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

HANNITY: Is there a part of you happy that the value of their stations are dying? Are you happy that the guys following you are flopping? Be honest.

STERN: Sure. I would love to be the only radio personality in the country who was successful.

HANNITY: I'd like a little success. Do you mind? I'm in a whole different genre.

STERN: You can have success. You already have it, from what I understand.

HANNITY: I have some.

STERN: You're doing very well.

HANNITY: What do you mean? You should be listening.

STERN: You're a talented guy. Believe me, I'm unconscious most of the day.

HANNITY: Is that right? Yes.

STERN: Yes. But the fact of the matter is — no, I'm a fan of yours. I watch you on FOX News all the time.

HANNITY: Thank you.

STERN: And my point of view is that, sure, there's something very beautiful in the fact that I had this show for 20 years, it was successful, it was huge, and not just anybody can walk in the door and accomplish what I accomplished.

So of course there's a certain pride. There's a certain on my part that, you know what, if you want to sell radios? Those guys aren't fitting the bill? Maybe people are going to come over to Sirius and listen to me. Maybe that'll drive some subscriptions. I am thrilled about that.

But I do feel bad for the guys who replaced me. They deserve more than two months and to be evaluated.

HANNITY: Do you still want them to fail?

STERN: I don't want them to do so well.

HANNITY: All right. Not so well.

STERN: I tried to call into the David Lee Roth show. He wouldn't take my call. I was going to give him some advice.

HANNITY: You can call my show anytime.

STERN: I will call in.

HANNITY: I know what the advice is. "Hannity, stop with the Republican stuff, the conservative stuff."

STERN: Get some strippers in there.

HANNITY: I like to talk about things that I know about. I don't know anything about that.

STERN: You sure? You've never been to a strip club?

HANNITY: No.

STERN: What are you talking about? What the hell is wrong with you?

HANNITY: What happened to me? I don't know.

STERN: What are you, a choir boy? You probably were.

HANNITY: No, I was an altar boy. I was all right.

STERN: You never did anything bad?

HANNITY: Yes, I was out of control.

STERN: You smoked a little weed?

HANNITY: I was out of control.

STERN: Did you smoke a little weed? Answer the question.

HANNITY: From the time that I was 23 and younger, I absolutely admit to nothing because I did everything.

STERN: You did coke?

HANNITY: Get out of here.

STERN: Did you do shrooms? Did you do acid? Psilocybin? What did you do.

HANNITY: What do I know about these things?

STERN: Oh, man. There must be a story here.

HANNITY: I have admitted everything that I've done on the radio.

STERN: You see how Les Moonves is trying to trample me? The religious right's going to trample on you when they hear what you did.

HANNITY: Let me tell you, over the years — this is a true story — I've always defended you. I've always thought the FCC has been unfair to you.

STERN: You've been great.

HANNITY: And you know what, when I first started, my first radio show, I got thrown off the air because I was a conservative.

STERN: Right.

HANNITY: And if they can throw Howard Stern off the air — I don't think you should be able to say the "F" word...

STERN: I agree.

HANNITY: ... on talk radio. Small limits. But if they can throw you off, they can throw conservatives off.

STERN: Sure.

HANNITY: And I'm thinking, "Why do we have free speech?" If you don't like what Howard's saying, turn it off.

STERN: Yes, that's how I always felt, too. Well, you're a broadcaster. You know how it is. And that's why I say, even to all my fellow broadcasters, beware.

HANNITY: Pay attention.

STERN: Because a guy like Les Moonves doesn't have an ounce of respect for us. He will put you to work, he'll tell you — he'll pat you on the back, say you're doing a good job, and then when you leave, he'll sue you. This is not a guy you want to work for. Katie Couric, beware.

HANNITY: You're richer than you've ever been before. You like it? Do you like change at all when you have all that money?

STERN: You know, it's funny. They write in the newspaper what I'm getting. I haven't gotten it. I've only been working here a month. I haven't earned any money yet. No, I haven't earned any money.

Everywhere I go, people go — I was looking at something the other day, and they go, "You can afford that. You can afford that."

I go, "The hell just happened here?"

No. I feel very blessed that I'm one of the guys that gets compensated for what he does. The strangest thing for me in radio is the fact that I make any money at all.

When I got into radio, I was a kid from Long Island. I'd gone to Boston University. My father scraped together everything to send me there, which I will be eternally grateful for. And I became a communications major. I had a dream when I was 5 years old that I'd get into radio. My dad was a radio guy, and I wanted to be behind the microphone.

HANNITY: Wasn't exactly that supportive, though. He...

STERN: No, he was tough on me. But the fact of the matter is, my first job was $4 an hour at WRNW in Westchester, and I used to pray to God that I would make $250 a week. I knew if I could make $250 a week, I could at least, you know, feed myself and feed my wife.

HANNITY: I got paid nothing for the first year, so you're making more than me. Then, $19,000 a year.

STERN: I was making $96 a week. Ninety-six dollars a week.

So the idea — I never got into radio to make money. If you get into radio to make money, you're insane. It doesn't — you know, people at me now and go, "Gee, what a good career choice." It wasn't like that. The odds of me ever being successful in radio were about a billion to one.

HANNITY: You always say the secret of your success — it has nothing to do with any of the strippers or lesbians. You say that's part of it, but the real secret of your success, you say, is that you are brutally, brutally honest. And basically, every thought that comes into your head, you speak.

STERN: Yes.

HANNITY: You said you go to therapy four days a week. You seem conflicted in some ways. Are you a conflicted person? Are you — you know?

STERN: Yes, I don't think I was ever a happy person.

HANNITY: Are you now?

STERN: Yes, I think I am a happier person. I went into therapy specifically to become a better father. I felt that not only — I'm someone who gets lost in his work. I think that's why I take this lawsuit so personally. I have sacrificed so much in my life for this work, for this radio, for my radio audience, that at times, I knew it wasn't healthy.

There were entire summers went by, I'd be down in my basement writing my books. And my life is passing me by, in a sense. And I gave a lot to this career. And I'm totally devoted to it. And I knew the balance in my life was off. And I knew I needed therapy, or some help, in order to find that balance.

I'm in a great relationship with my girlfriend, Beth, now. I don't want to screw that up. I don't want to get lost in my work again. I want my kids to know that I have, you know — my attention is on them, and I love them. I want people in personal life to know I care about them. And that was something I worked on in therapy. And I'm proud of that.

(END VIDEOTAPE)

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