'The Kelly File' breaks down impact of Iran nuke deal on global security

What does the nuclear agreement mean for the world?


This is a rush transcript from "The Kelly File," July 14, 2015. This copy may not be in its final form and may be updated.

MEGYN KELLY, HOST: Breaking tonight, new fallout from what the president calls an historic agreement on Iranian nukes and the critics call a deal that would live in infamy for the dangerous it possess to the world.

It is July 14th, 2015, a date on which there is a clear shift in the global balance of power. What we don't know yet is whether it is a move towards peace or mid-east nuclear arms race. Today, more than 25 years after Iran obtained the secrets to building a nuclear weapons, the U.S., its partners and Iran reached what President Obama celebrated as a deal to limit Iran's nuclear program which he says will make America and the world more safe.


PRESIDENT BARACK OBAMA: Because America negotiated from a position of strength and principle, we have stopped the spread of nuclear weapons in this region. This deal offers an opportunity to move in a new direction.


KELLY: In Iran they are celebrating, as well. Rejoicing in the coming end to sanctions that had badly compromised the Iranian economy.  Remember this is the same Iran that just a few days ago was vowing death to Israel and chanting death to America. Listen.

Less than a thousand miles away in the Israeli capital, a very different reaction. Prime Minister Benjamin Netanyahu calling this a historic mistake that gives Iran access to $100 billion and a sure path to the bomb.


BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: By not dismantling Iran's nuclear program in a decade this deal will get unreformed, unrepentant and far richer terrorist regime the capacity to produce many nuclear bombs, in fact an entire nuclear arsenal with the means to deliver it. What a stunning historic mistake.


KELLY: A member of Mr. Netanyahu's cabinet was less delicate saying, quote, "Today, a terrorist nuclear superpower is born and it will go down as one of the darkest days in world history." Here is how the deal breaks down and why the critics are upset. The key part of the agreement cuts the nuclear fuel supply line by reducing stockpiles of the uranium, limiting access to new supplies and slowing the enrichment process. It creates a system of verification and inspections and it keeps certain sanctions in place until Iran complies. But Iran gets nearly a month notice before those inspections actually happen and only if the overseeing nations including Iran agree in the first place that inspections are warranted.  Iran gets its economy back. The money spigot is turn back on to a country that has repeatedly used its military and financial resources to murder Americans.

Iran also gets something the chairman of the Joint Chiefs Martin Dempsey recently said should never happen under any circumstances, a ban that is now in place on its access to arms and ballistic missiles will be lifted in five to eight years if not sooner. And when this deal runs out in less than a decade Iran may still get the bomb.

Tonight we have Ron Dermer, the Israeli ambassador to the United States as well as Marc Thiessen who is a former chief speech writer for President George W. Bush. But we begin with FOX News senior political analyst Brit Hume.

Brit, your thoughts on the deal.

BRIT HUME, FOX NEWS SENIOR POLITICAL ANALYST: Well, Megyn, it's not that the United States got nothing out of this. Iran's nuclear program is hindered and delayed for a period of time. The problem of course is that after that period of time, the program is basically permitted. It is I think inevitable that Iran then becomes a nuclear power which is something these negotiations were ostensibly designed to avoid ever happening. In addition to that, as your summation of what is going on here mentioned, the verification process to see that Iran is living up to the deal is complex and somewhat unwieldy affair involving having that committee of nations determine whether the requested access to a certain site in Iran is necessary and it could take up to 24 days for that all to be vindicated and that of course would provide potential time for Iran to do away with anything that the inspectors might find.

Now, the argument is made that that is not enough time and so forth with them to do away with all, and we are going to be hearing all that playing out in the weeks ahead. But there it is. In addition of course, it was always said by the administration that these sanctions which Iran has been so desperate to get lifted would snap back into place were there any violations. Well, it turns out that was not quite the way it would work either. The so-called snapback process is one in which the same committee of nations with Iran on it would have to agree and would have to go along with all of that.

And of course, everyone knows that once the sanctions regime is lifted, it is exceedingly difficult to get it re-imposed. And key members of that committee are European countries which are dying to resume trade with Iran and it had been restrained by the fact that the international community and the U.N. of course has imposed sanctions regime leaving the United States in the position where it could re-impose sanctions if it chose to do so. But it would only be American sanctions and not sanctions for so much of the rest of the world. So, those are a couple of the things that have set off the alarm bells that you have been talking about coming from Israel and many quarters within the United States, as well.

KELLY: But the President came out today and spoke to some of these issues and said, he said, consider what happens in a world without this deal. He basically said the world was tired of these sanctions and there is support for that notion that our European partners were going to bail and others were going to bail and loosen the noose around Iran anyway. And so tightening the sanctions was not an option. And their response is therefore it is better to have some deal that slows down the program for a decade than to pretend we were going to get greater sanctions and crack down on Iran when the reality is, we were losing our partners in that effort.

HUME: That is probably Megyn, the best argument that can be made for this agreement, that sanctions regimes were slipping as sanctions regimes will. And that we didn't have good options here. Some of the same people, by the way, that are making that argument on behalf of the Obama administration disputed that argument when it was made by the Bush administration as to one of the reasons we had to go after Saddam Hussein.  Remember. He was supposedly hemmed in by sanctions and that regime was beginning to slip which is one of the reasons that the box that he was supposedly in, the fear was that it wasn't into hold him very much longer.

But that aside, Megyn, that is probably the best argument that can be made. And you will hear it in many forms. One of the forms you will hear is, that it was either this deal or something very like it or war. And some pessimist, even critics of the deal think that maybe so. John Bolton for example thinks it is the only option now because the deal cannot be undone. He doesn't believe is to strike Iran and Israel will have to do it. So, there is some support for that argument. Nevertheless, Megyn, remember this. You may recall the administration insisting that we didn't want to bring up the subject, for example, of the Americans held captive in Iran because we are trying to stick to the nuclear piece of this. Well, it turns out in this deal as you've mentioned earlier that the ban on conventional arms sales to Iran is going to be lifted, as well. That is the opposite of nuclear conventional.

KELLY: Uh-mm. What's factoring in that --

HUME: How did that get in there at the last minute? Well, it does suggests that the administration was so eager to make a deal that it let Iran throw that concession request in at the last minute and they got it.

KELLY: Uh-mm. Brit, thank you.

HUME: You beat.

KELLY: So, as Brit just mentioned the hardest part of selling a deal with Iran is that it involves Iran. This is of course a country that had supplied weapons to groups like Hezbollah and Hamas is listed as a state's sponsor of terror and is directly or indirectly responsible for killing or injuring hundreds, maybe thousands of U.S. soldiers. In fact, the chairman of the Joint Chief as I mentioned made clear a week ago that in no scenario should we lift our weapons ban on this country.


UNIDENTIFIED MALE: Under no circumstances should we relieve pressure on Iran relative to ballistic missile capabilities and arms trafficking.


KELLY: But that is what we just did. Marc Thiessen is a FOX News contributor and a former chief speechwriter. That is exactly what we did.  They put it in at the last minute after saying, we have to stick to nuclear, don't talk to us about your hostages. Oh, but we love for you to lift these arms embargo and we did it even though that is Martin Dempsey saying, that is a red line.

MARC THIESSEN, FOX NEWS CONTRIBUTOR: It is amazing. I mean, does Barack Obama ever listen to his military advisers about anything? I mean, the nuclear side of this deal is bad enough. But just a week ago both his chairman of the Joint Chiefs of Staff and his secretary of defense warned that under no circumstances should we be lifting the arms embargo or the restrictions on ballistic missiles. And he ignored their advice and did it. And it is not just them. General Lloyd Austin, the commander of Centcom said just four months ago in addition to its nuclear program, Iran has the largest most diverse ballistic missile arsenal in the Middle East.  A year ago the head of our Missile Defense Agency said that Iran could develop and test an ICBM capable of reaching the United States by 2015.  So, they have a one year break out for a ballistic missile to reach us.  So, not only are we paving the way for a nuclear bomb, this deal is paving away for the missiles to deliver it.

KELLY: So, what is this about? I mean, do you -- because many people have said this is about Barack Obama wanting a legacy issue.

THIESSEN: It is very much about him wanting a legacy issue. I couldn't agree more. But I mean, his legacy, his insistence on a legacy is constantly interfering with our national security. He wanted a legacy of pulling all of our troops out of Iraq. Our military commanders told him don't do that. He did it anyway and he's got a legacy of having, given this the rise of ISIS. Now, he wanted a legacy of a nuclear deal and now our military commanders told him, don't lift the sanctions on ballistic missiles and on weapons. And he is doing it anyway.

KELLY: So, Iran gets $100 billion and they get access to arms and ballistic missiles within the next five to eight years that our chairman of the joint chief said under no circumstances that they get. We've also lifted sanctions on some sketchy individuals although the administration says, not to worry.

THIESSEN: Yes. According to the Iranian side they put this out. The sanctions are lifted on General Qassem Suleimani who is the terror master mind of Iran. This man is responsible for the death of more Americans than any living terrorist. He is responsible, personally responsible for one third of the U.S. casualties in Iraq during the Iraq war because he created and funded the Shia militias and gave them explosively formed penetrators that killed literally hundreds of American troops and we are lifting sanctions on him? He has nothing to do with the nuclear program. And he is under sanctions for terrorism. Why are we lifting sanctions on the terrorist?

KELLY: Well, they are claiming like one pot of the money is, you know, they're lifting not the terrorism sanctions but other sanctions.  Marc, thank you.

THIESSEN: Thanks, Megyn.

Well, President Obama himself called the Israeli leader today to discuss this deal with Mr. Netanyahu and the Israeli ambassador is here next on their reaction to it.

Plus, breaking news tonight, believe it or not on the Little Sisters of the Poor. Remember this group and the high stakes lawsuit between these nuns and the Obama administration? And it is not good news for the sisters or those to whom they minister.

And then the prosecutors in the Freddie Gray case now face new and ugly charges of blatantly unethical conduct and misleading a judge. They could be in some serious trouble tonight.

Plus -- sanctuary cities.


BRAD STEINLE, BROTHER OF KATE STEINLE: There is nobody that could look me in the eye and tell me that that man had any right to be walking free in the city of San Francisco with the ability to shoot and murder my sister, Kate.


KELLY: After Kate Steinle's brother questioned the policies that lead to his sister's death, Congress took it to the administration today. And wait until you see what happened.


REP. TREY GOWDY, R-S.C.: It may have been a sanctuary for that defendant but it sure as hell was not a sanctuary for a young woman walking with her father.



KELLY: Back now to our breaking news on the fallout from Iran, nuclear agreement. And it is hard to imagine a bigger divide than the space today between Democrats in Washington and leaders in Israel. In Tel Aviv they see this as a historic mistake. President Obama and his party see a victory.


OBAMA: This deal demonstrates that American diplomacy can bring about real and meaningful change, change that makes our country and the world safer and more secure.

JOHN KERRY, SECRETARY OF STATE: The arms embargo continues for five years. The missile continues for eight years and we are, you know, we had three of the countries of the seven negotiating who wanted no embargo at all. So, we actually won a victory.

HILLARY CLINTON, D-2016 PRESIDENTIAL CANDIDATE: This is an important step in putting the lead on Iran's nuclear program.

SENATOR BERNIE SANDERS, D-2016 PRESIDENTIAL CANDIDATE: First off, I applaud the President and Secretary Kerry for their efforts in a very crazy and dangerous world to create an agreement with Iran which prevents Iran from acquiring a nuclear weapon.


KELLY: Joining me now, Ambassador Ron Dermer, he is the Israeli ambassador to the United States. Ambassador, good to see you tonight. And so, they echo what the President said which was, we give up nothing by testing whether this problem can be solved peacefully.

RON DERMER, ISRAELI AMBASSADOR TO THE UNITED STATES: Well, I think you have given up everything. Yesterday Iran had an illegal nuclear program and was facing a head wind of sanctions. This deal gives them a legal nuclear program and gives them a tail wind of sanctions relief that they're going to use to continue their march of conquest and terrorism throughout the Middle East. Any rock in Syria, in Lebanon, in Gaza, in Yemen. And during this deal Iran will be able to continue to do research and development on advanced centrifuges and to develop their Intercontinental Ballistic Missiles. And I have news for you, Megyn. We are on Israel's on the same continent as Iran. So, those ICBMs are for you. And after these ten years are up these constraints which are only temporary, the major ones will be removed. And Iran will be given basically a path to a nuclear weapon. And all of our neighbors know that.  That is why Israel and the Arabs see eye to eye on this. And when that happens --

KELLY: But the administration's response is, there were no constraints on the program prior to this.

DERMER: There was a huge sanctions regime against them.

KELLY: But they said, it was falling apart.

DERMER: Massive constraints. It wasn't falling apart. If the administration wants it to fall apart, it will fall apart. Don't forget, the administration was against a lot of these sanctions to begin with.  They tried to prevent the Senate from passing sanctions a few years ago.  The sanctions regime was working. It had worked only for 18 months. You haven't had sanctions on Iran for a decade.


For 18 months, Iran -- let me just finished, in 18 months Iran was desperate to come to the negotiating table. And instead of actually dismantling their nuclear program which is what everyone said two years ago, we'll dismantle the sanctions regime when they dismantle their program. What you are doing is dismantling the sanctions regime and leaving their program essentially intact.

KELLY: Here is what they point to. You tell me. That because they point to Britain's ambassador to the United States who said sanctions have already reached the high water mark, you will probably see more sanctions erosion if the nuclear talks fail. Germany's ambassador said, if diplomacy fails the sanction regime might unravel. Other say that Iran's historic trading partners will not economically injure themselves indefinitely that our partners were losing their back bone.

DERMER: Look, just as a factual matter, the sanctions regime was built for two reasons, Megyn. The first was there was a credible military threat. As long as Europe and Russia and China saw a credible military threat, they were more concerned about a military confrontation with Iran than in nuclear armed Iran. That is the truth. That's the way they went on board the sanctions regime to begin with. The second reason is that you have a unilateral arrow in your quiver to enforce multi-lateral sanctions.  It's your banking system. America is over 50 percent of the capital flows in global finance. Iran accounts for about one-tenth-of-one percent of those flaws. So, which German bank exactly is going to do business with Iran rather than do business with the United States?

KELLY: My last question. My last question. I apologize. We are short on time. We had so many guests to get in. But, what is the reaction of the Israeli people tonight? What are you hearing?

DERMER: Well, you know, Israel we have a very rambunctious democracy with a lot of different views. What is unique is how much Israelis are coming together and standing united against this deal. The prime minister of Israel met with the head of the opposition tonight. They both see eye to eye in this deal. And Israel and its Arab neighbors, that happens about once a century when we see eye to eye on something pay attention. Your allies in the region. Those most vulnerable, most endangered by this deal, we are opposed to it. People should ask themselves, why? Why are those who are supposed to do so much for so opposed to it?

KELLY: Ambassador Dermer, always good to see you. Thank you.

DERMER: Thank you.

KELLY: Also tonight in other news, prosecutors in the Freddie Gray case now being accused of blatantly unethical conduct and of misleading a judge directly in this case. And if what the defense says is true, those prosecutors could be in a lot of trouble.

Mark and Arthur are here.

Plus, there is breaking news this evening on the little Sisters of the Poor and the high stakes lawsuit between these nuns and the Obama administration. And it is not good news for the nuns, next.


UNIDENTIFIED FEMALE: -- Helping them into a chair, listening to them, all of those are opportunities, and we need Christ really living in them.  And then we bring Christ to them and ourselves.



UNIDENTIFIED FEMALE: -- Helping them into a chair, listening to them, all of those are opportunities, and we need Christ really living in them.  And then we bring Christ to them and ourselves. It's the most beautiful moment. And then (INAUDIBLE) to the hand of God, you know they are there.


KELLY: Developing tonight, big news on the legal battle between the government and the nuns you just saw. The Little Sisters of the Poor who have devoted their lives to helping those in hospice care. Last year, the Little Sisters asked to being exempted to having to comply with ObamaCare contraception mandates saying, it forces them to choose between compliance with the law and their faith. Today, the Tenth Circuit Court of Appeals told the nuns, too bad.

Mark Rienzi is the lead counsel for the Little Sisters, he is with me now. So, they've lost -- they've lost and now they either have to pay fines of about $2 million a year or sign the form that allows those working with them to get free contraception care.

MARK RIENZI, BECKET FUND FOR RELIGIOUS LIBERTY: Well, Megyn, they've lost one round of it and this is a case where the Supreme Court every time it has heard the government's arguments has ruled against them. So, the government may think that it can tell nuns what their Catholic faith requires but every time the government's made that argument at the Supreme Court, they've lost including in this case a year ago. So, we think they're going to lose again. They simply put the bureaucrats in D.C. don't get to tell nuns what their faith requires.

KELLY: Who -- just -- who is working for the Little Sisters who requires these contraceptive services?

RIENZI: Well, the government argues that some of their employees might want them. That is not something that's ever happened, that's not something that's ever been an issue for the sisters. And their help plan is never provided them. So, I'm not sure it is true that there's anyone who wants it.

KELLY: Okay. So, let me just jump in. The government says, look, little sisters, you're not a church, but you are a related organization, so if you just sign this form saying, we're not going to do it because of our faith. That will allow said employees, some unknown employees to go get this coverage directly from the insurer. You're out of it. What is your beef?

RIENZI: So the problem is that it's two fold, one, is that the little sisters' religious beliefs tell them they can't sign those forms. But two, is that the government says the way it wants to get the drugs to people is by taking over the Little Sisters' insurance plan and their insurance program and the infrastructure of that plan to give them out. And just like a Jewish school can't let the government use its cafeteria to give out pork sandwiches or Catholic hospital can't let the government use its surgery rooms to perform abortions. The nuns can't give the government control of their plans to give out the drugs. All of which is particularly ridiculous now that the government has its exchanges. The government has its own delivery system. It doesn't need to go drag the nuns into this.

KELLY: Mark, what is going to happen to them if the Supreme Court doesn't take their case?

RIENZI: Well, it's a good and it's a terrible question. The government is threatening them with tens of millions of dollars in fines if they won't violate their religion. So far, the Supreme Court has been willing to protect people from being forced to make that kind of awful choice. And we hope that is what continues. Certainly, no one wins if the Little Sisters of the Poor are forced to either give up their ministry or to violate their Catholic faith. They should be allowed to just go helping those elderly poor people and the government should go give out contraceptives some other way that on the backs of Catholic nuns.

KELLY: And if the Supreme Court doesn't take this case and that is the end of the line for these nuns, it is going to be a major pr disaster for the administration if they have to --

RIENZI: And a needless one. There is just no need because the government has its own systems. This is ridiculous.

KELLY: Mark, thank you.

RIENZI: Thank you, Megyn.

KELLY: Well, Dinesh D'Souza is behind bars for eight months as part of his punishment for violating campaign finance laws. Now the judge wants more and D'Souza is here to talk about why he now has been mandated to undergo psychological counseling for five years. And that's not all.

Plus, after Kate Steinle's brother questioned the policies that lead to his sister's death, there were news demands for answers today.

James Rosen is next on the fireworks from Capitol Hill this afternoon.  You will not believe what happened.

Also, Trace Gallagher confronts the city leaders in San Francisco.


STEINLE: About the sheriff has said regarding the fact that they have done nothing wrong, I would like him to look me in the eye and tell me that there is no blame to be put on this policy. It's ridiculous.  




KELLY: Has anybody from the administration contacted you?

BRAD STEINLE, BROTHER OF KATE STEINLE: No. Nobody has contacted either my parents or I.

KELLY: Not the White House, not the President, not the Vice President?

STEINLE: We have not heard a word.


KELLY: And he went on to say he wished someone would. Not much has changed in the last 24 hours, after we spoke with Brad Steinle. As we get word from the Steinle Family late today, that not a single White House or Obama Administration official has called, since Kate Steinle, a 33 year old woman was killed by an illegal immigrant, who should have been deported and had been five times but kept coming back. And said he was released from custody because of San Francisco's Sanctuary City Policy. And today, Congress questioned that fact and how we got there. Chief Washington Correspondent, James Rosen is live in our D.C. news room tonight, James?

JAMES ROSEN, WASHINGTON: Megyn, good evening. As the Head of the Department of Homeland Security, and a Former Federal Prosecutor at that, Jeh Johnson might be expected to have some view of whether so-called sanctuary cities violate the law with their refusal to enforce key federal deportation statutes. But in a three and half hour house judiciary committee hearing today, that often grew contentious, Johnson declined to offer a legal judgment, on whether sanctuary cities violate the law.  Instead he touted management reforms he's enacted in his 18 months at DHS, and he fended off questions about the killing two weeks ago in San Francisco, a sanctuary city of Katherine Steinle, the 33 year old woman shot to death during a stroll with her father, allegedly by an illegal immigrant from Mexico who had been deported five times. Some lawmakers here found unpersuasive, the secretary's argument that the Obama Administration, which has in so many policy areas sought to enlarge the powers of the federal government will not now enforce sanctuary cities to comply with federal immigration statutes because the administration wishes to avoid infringing upon state and local prerogatives.


JOHNSON: I do not believe that mandating through federal legislation the conduct of sheriffs and police chiefs is the way to go. I think it will be hugely controversial, I think it will have problems with the constitution.

GOWDY: The last time I looked we had a supremacy clause, and federal law trumps state law so god knows it trumps the law in San Francisco. And when I hear the phrase sanctuary city, as benign sounding as it is, it may have been a sanctuary for that defendant, but it sure as hell was not a sanctuary for a young woman walking with her father.


ROSEN: And lawmakers noted the silence of President Obama on the Steinle case. It is in market contrast with his lengthy statements on cases of Trayvon Martin, and Freddie Gray, and his personal phone calls to Jason Collins, and Michael Sam, two pro athletes who came out of the closet, Megyn.

KELLY: James, thank you.

And it is not just the administration staying quiet on this. Kate's brother, Brad, told us last night, that in the 13 days since his sister was allegedly killed by a man who had no business being in California or even in the United States, no one on the local level has called to address how it happened either. Trace Gallagher today went out to find out why.  Trace?

TRACE GALLAGHER, SAN FRANCISCO: Megyn, we had not heard from San Francisco Mayor, Ed Lee since the sheriff blasted him during last week's news conference. We were told the sheriff was under the weather not feeling well. Well he felt good enough today to come to the city council meeting, and lash out at both the sanctuary city law and the sheriff.  Listen.


ED LEE, SAN FRANCISCO MAYOR: As you know I believe strongly that we should cooperate with federal immigration officials when they request notification of pending releases for serious, violent, or repeat felons, including those who have previously been deported on multiple occasions.  How some of our cities' law enforcement leadership has chosen to exercise or ignore their existing authority remains a question of concern.


GALLAGHER: And of course, the mayor is not the only one to take a swipe with the sheriff. Last night on the Kelly File, Kate's Steinle's brother, Brad called the sheriff's stance on the sanctuary city policy "ridiculous." So the Kelly File tried to track the sheriff down again today to speak with him, and this again is as far as we got. Play this.


UNIDENTIFIED FEMALE: Do you have a good question for the sheriff. Is he available to speak with us?

UNIDENTIFIED FEMALE: No. He isn't right now.

UNIDENTIFIED FEMALE: Ok. Would you be able to answer two questions?

UNIDENTIFIED FEMALE: Well, he is not available right now.


GALLAGHER: Now the sheriff did get support today from those who rallied in favor of the sanctuary city policy, and during that rally, we spoke with Council Member David Campos. He dodged our questions about the Steinle Family, but he did say this. Listen.


DAVID CAMPOS, SAN FRANCISCO BOARD OF SUPERVISORS: One thing that I think we have to be very careful of is to make sure that we do not lose sight that this is a very complicated issue that has another perspective, as well. And that we cannot let the actions of one individual lead to an overreaction that ultimately make the community less safe.


GALLAGHER: But the fatal action, the alleged actions of that one individual has started a fiery debate around the nation, Megyn and clearly a divide among city leaders here in San Francisco.

KELLY: Trace, thank you. Joining me now with more, Janice Fuentes, Former Chief of Staff to Illinois Democratic Congressman, Luis Gutierrez, Janice, good to see you tonight. Do you agree with the mayor who was essentially saying there that the sheriff did the wrong thing?

JENNICE FUENTES, FMR CHIEF OF STAFF REP. GUTIERREZ: Well, there has been a lot of blame to go around. And I would like to talk about is not just the blame because that's not going to bring the young lady back. I think what we need to focus is how this was able to happen.


KELLY: The sheriff let the guy out.

FUENTES: Exactly, because there was no warrant for his arrest. And if you think of the system, the system is broken.

KELLY: There was a detainer order in place which the law requires the locals to comply with but the feds are not enforcing that.

FUENTES: Right. There was a failure in the system. Grant you that, absolutely. Why is this happening? Why do we have all of this patchwork of sanctuary cities around the country? Because back to the same initial element, Megyn. The federal government has relinquished its responsibility to set the immigration law for the system. And I know you're going to tell me we have immigration laws, but they don't respond to the 21st century needs of our immigration system.

KELLY: I understand that you want a comprehensive immigration reform bill, and many people in the country do. There isn't one in place. What we do have in place right now are laws. And you are required to obey them even if you are a city like San Francisco that wants to provide "sanctuary" for whom is another question, as you heard Trey Gowdy raised today.

FUENTES: I know, Megyn. For the police and law enforcement to work, they need our cooperation. The people who live in the community...


KELLY: They need the lobby to change the law.

FUENTES: They need to come forward. The people who are not documenters see something wrong.


KELLY: What I'm saying to you Jennice, is great, go out and make your case to the lawmakers. Until you get that law changed, you have to comply with it. The law is the law.


KELLY: If the Republicans were completely flouting Obamacare and the other laws that have been passed by the Democrats? No.

FUENTES: Listen, yes, remember, look at the most recent effort which was in the senate with at least 13 Republican votes, including Lindsey Graham, including Senator Flake. We had McCain. Those people who had been consistently supportive of immigration. It passed the Senate, it was never brought to the floor of the house. And if you look at the enforcement part of it, there was 700 miles of a double fence...


KELLY: Jennice, you are arguing for the purpose of this discussion -- for the purpose of this discussion I gave you that. But that doesn't get to the issue here, which is the flouting of the law. The last question I want to ask you is shouldn't the White House be reaching out to this poor family, which has specifically said they would like to hear from somebody?

FUENTES: Absolutely, 100 percent. The President, the Vice President, somebody should call the family and somebody should have been right there with them.


FUENTES: The reasons for that, I don't work for the White House. I have no idea. But I am with you. They should have heard from the President or his staff or the Vice President, absolutely.

KELLY: Absolutely, I mean they say it on camera explicitly, and it might mean something. It might just be a validation of her life.

FUENTES: It means a lot.

KELLY: Anyway Jennice, good to see you.

FUENTES: Good to see you, Megyn.

KELLY: Well, a federal judge can't understand why someone like Dinesh D'Souza would get caught up in violating campaign finance laws. Look at this. Look at this. So wait until you hear what the judge has now ordered for the conservative film maker and Dinesh's his response live here. Plus, the prosecutors in the Freddie Gray case maybe in a lot of trouble, they are facing new and serious charges of unethical conduct and of misleading a judge. That's next, with Mark and Arthur.


MARILYN MOSBY, BALTIMORE CITY STATE'S ATTORNEY: To the youth of this city, I will seek justice on your behalf. This is a moment. This is your moment.



KELLY: New controversy tonight in the Freddie Gray case in Baltimore, as lawyers for the so-called Baltimore Six accused Prosecutor Marilyn Mosby's team of unethical conduct and misleading a judge. They say Ms. Mosby's office obtained cell phone records of the accused cops by misleading a jurist, and they say she is now withholding evidence to which the defense is entitled. Mark Eiglarsh, is a Criminal Defense Attorney, Former Prosecutor, Arthur Aidala is a Fox News Legal Analyst, and New York Trial Attorney. So if this is true, Mark...


KELLY: Blatantly unethical. What are they saying she did?

EIGLARSH: I am outraged. They go to judge number one. Judge number one says no, I don't think there is probable cause to get a search warrant.  Then they go to judge number two, without telling judge number one or judge number two that they had been to judge number one. Same exact evidence, same exact search warrant and judge number two says yeah there is probable cause. Megyn Kelly, let me tell you something, my own children, my young children know that when you go to daddy you better tell me that mommy said no first, or daddy's going to get pissed. They deserve a time-out for this, Megyn.

ARTHUR AIDALA: Megyn, I think all three of us agree that this case is not charged properly, and we don't know how it is proven beyond a reasonable doubt. However, these are public servants, these prosecutors.  This woman who is on screen, she is not doing any of this. Senior prosecutors are doing this. Ok, Mark, you're assuming facts that are not proven yet.


KELLY: The defense has attached motions that she filed for the search warrant.


AIDALA: If I may be heard. It's the defense that is alleging the second judge didn't know. However, in that motion it says there is a conversation between the prosecutor and the second judge. We don't know if that conversation the prosecutor said by the way, Judge Smith, Judge Jones looked at this yesterday and he refused it. And Megyn, if that took place, and then there is nothing wrong with that.


EIGLARSH: I disagree.

AIDALA: As the second judge knows that the first judge rejected it, the second judge can reach a different decision.

EIGLARSH: I disagree with Arthur so strongly. Arthur, so strongly like I have never before. Let me tell you something. It is so unethical to go to a second judge. It is called judge shopping. The appellate court they don't like it.

AIDALA: Not if you tell...

KELLY: You're basing that on nothing right now. You're assuming that they are proceeding in bad faith and what they allege in their motion is untrue.

AIDALA: And they're assuming they have no proof. What proof do they have?

EIGLARSH: They do.

KELLY: How could they go to the second judge? What business do they have going to the second judge when they were already been denied with a motion identical to the first one? They were rejected. They were judge shopping.

AIDALA: Because Megyn, the law says you can do it. As long as you tell the second judge we went to this judge and he denied it.


EIGLARSH: Would you concede if they didn't that would be problematic and the evidence should be thrown out because there is case law?



KELLY: Then the second judge will tell us whether or not this was disclosed. The defense says it never was. We will find out. If it wasn't disclosed those cell phone records may get suppressed which could be very bad for Ms. Mosby.


AIDALA: But we don't even know if there is anything on those records that are so incriminating anyway. This could be all over nothing.

KELLY: Correct. But there is a reason the defense wants them back.

EIGLARSH: It undermines due process. That's the problem.

KELLY: The defense is also alleging that Ms. Mosby conducted her own investigation in this case, which she did with the Sheriff's Office, separate from the Police Office. And that she is not disclosing the results of that investigation. Mark, is she required to?

EIGLARSH: Not everything. Her personal notes would be work product, like her impressions, her conclusions. But if she conducted interviews and those interviews differ from what law enforcement conducted and even slightly, that stuff is discoverable, reports, witnesses all discoverable.

AIDALA: Megyn, what Mark and I do in our day jobs is every day we fight prosecutor's offices to disclose that stuff as early as possible.  But there is case law and statutory law as to when we get certain documents, and it is up to the judge's discretion when we get other documents. How much before a trial do we get those documents?

EIGLARSH: And you know what Arthur, if the judge rules against us we don't go to another judge and try to get a second bite at the apple.


AIDALA: In Brooklyn that's how I roll.

KELLY: Down in Miami it may not work that way.

EIGLARSH: Time-out.

AIDALA: That was a joke.

KELLY: He's the President of the Brooklyn Bar Association too, so he wishes no.

Coming up next, is Dinesh D'Souza crazy? Up next, why a federal judge is now well, not exactly asking that question, but yeah asking that question.


KELLY: Is Dinesh D'souza crazy? A federal judge thinks he needs some help. Sentencing D'Souza to ongoing psychological counseling even though two psychologists cleared him. D'souza has already spent eight months in nightly detention. But the judge believes that his violation of Federal Campaign Finance Law is evidence of much deeper issues. Dinesh is with me now. He is an Author and Creator of the documentary film America. And this judge, Richard Berman of the U.S. District Court, a Clinton appointee says he is only trying to be helpful to you, Dinesh, that you might need a little help, and your thoughts?

DINESH D'SOUZA, CONVICTED OF CAMPAIGN FINANCE VIOLATIONS: Well Megyn, the judge had professed at the time of my sentencing to be absolutely baffled about why someone -- in his words as intelligent as me, as successful as me would do this. I tried to explain to him as an immigrant I left my family behind and I had become very close friends with a group of Dartmouth pals, including Randy Long, who later was running for the Senate.  So the judge ordered me to do counseling and I've now done eight months of counseling. He then said counseling was not adequate, he wanted me to be examined by a medical psychiatrist and take standard psychiatric exams. So I did that and a prominent New York psychiatrist certified that I was perfectly normal. Then the judge said he was not satisfied by that and he wanted to have a government psychiatrist reexamine me. So I took another batter of tests, and the government psychiatrist said I was perfectly normal. And then at the end of the eight months of my confinement, my counselor wrote the judge a letter saying I was perfectly normal, and not in need of any further therapy. But the judge said that he has experience in social work that he was a psych major in college. He doesn't agree with these assessments and so it's...


KELLY: He said he agrees with some of the notes in the assessments that you have remarkably little insight into your own motivations. You're not introspective or insightful, you tend to see your actions in a overly positive manner. That this crime involves the colossal failure of insight and introspection, and you have weaknesses in controlling your own impulses, and are prone to anger and reaction to criticism. You sound like a cable news host.

D'SOUZA: Megyn if I may let me read a couple of lines from a world famous psychologist, Roger Gould in New York who examined me for four months and then studied the results of my MMPI. He said I see no evidence of psychopathology, certainly no need for any kind of medication. He does not have the symptoms of anxiety or depression. He is not an angry person with an impulse disorder. I do not believe he's hiding anything. And it goes on to say, he is what presents himself to be. He's a good man. He made the mistake of good motives that led to bad judgment. That's my psychiatrist assessment.

KELLY: Good luck, Dinesh. We'll be right back.


KELLY: Tune in tomorrow night. We have Presidential Candidate Ted Cruz. We'll ask him about his battle with the New York Times and the best seller list, also a close friend of the sheriff. with your thoughts, see you tomorrow at 9:00. I'm Megyn Kelly.  

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