Mulvaney to withdraw from Kupperman case. TRANSCRIPT: 11/11/19, The Beat w/ Ari Melber.

Guests: Mara Gay, Berit Berger, Shelby Holliday, David Corn, Paul Butler,Neal Katyal

KATY TUR, MSNBC HOST:  "THE BEAT" with Ari Melber starts right now. Hi, Ari.

ARI MELBER, MSNBC HOST: Hi, Katy. Amen, and thank you as always. We begin THE BEAT with breaking impeachment news.

Brand-new testimony tonight from an impeachment witness that has just come out alleging evidence of bribery. A pentagon official telling Congress about Trump appointees pushing for Ukraine to commit to prosecuting election interference and tying that back to the now infamously frozen U.S. aid money and the aide confirming yes, that`s what the plot was.

The testimony is going public right now as Trump`s top Mick Mulvaney is asking a judge today to determine if he can testify against Trump in the impeachment probe. If it sounds odd that Trump`s top aide is now trying to sue Trump, it is odd, and I have a special breakdown on all of that coming up that we`ve been working on all day.

But we begin with the countdown to the hearings. The White House on edge as public impeachment hearings are now 48 hours away with signs that more witnesses are talking to these investigators, including Rudy Giuliani`s new indicted associate Lev Parnas.

"The New York Times" reporting that he went back to Ukraine in the spring to deliver an ultimatum to the incoming President, saying that they needed to have that announcement of an investigation into the Bidens or guess what? U.S. would freeze the aid. And not only that, but Mike Pence would also boycott the Ukrainian President`s swearing in if they didn`t get what they wanted.

Now this account, which apparently is now available to the impeachment probe would add to the other evidence of Donald Trump`s demand for this bribe from Ukraine. Now note, that while Parnas is tying this back to Trump, Giuliani, of course who represented this individual, was his consultant effectively, is denying the whole news story.

But then there`s this "The Daily Beast" with its own report that about a month before Trump`s now and from his call with the Ukrainian President two top Ukrainian aides were very concerned about all of this, and they asked Washington whether the money was in danger?

All of it comes as Donald Trump is bracing for what has become mounting bribery evidence to go public fully this Wednesday. And if you feel like there`s a lot flying at us, and there is in this story, consider that Wednesday is the first live televised impeachment hearings for the whole country to tune in and understand what these claims are.

The Trump`s allies trying to defend Trump in several different ways. The new one that we`re seeing is now conceding that something here was actually improper, but saying it wasn`t actually impeachable.

(BEGIN VIDEO CLIP)

REP. MAC THORNBERRY (R-TX): I believe that it is inappropriate for a President to ask a foreign leader to investigate a political rival. I believe it was inappropriate. I do not believe it was impeachable.

(END VIDEO CLIP)

MELBER: Let`s get right to it with a power panel on set Mara Gay from "The New York Times" Editorial Board; Berit Berger, a former federal prosecutor including in the pivotal Southern District of New York and "Wall Street Journal" reporter Shelby Holliday. Thanks for being here everyone.

Let`s start with that new line of defense from at least some House Republicans who obviously voted against going forward on even having an impeachment probe. That`s on the record saying hey I`m against all of this. And now conceding, but some of this is bad.

BERIT BERGER, FORMER FEDERAL PROSECUTOR: It`s pretty extraordinary to - on one hand taking the stance that we shouldn`t even be looking into this even a little bit and then to say but I agree that it was inappropriate.

And it`s got to be a pretty fine line between what you consider to be inappropriate versus impeachable. And it`s hard for him to have said that with a straight face since he didn`t even want to bring the witnesses forward to hear from them in a public setting about what potentially could be this inappropriate conduct.

MARA GAY, THE NEW YORK TIMES EDITORIAL BOARD MEMBER: I mean, I would say that given the election results last week in Kentucky and even more concerningly for the Republicans in Virginia that some of these Republicans have got to be looking at the prospect of public impeachment hearings saying that, we don`t actually know whether they`re going to change public opinion. But if they do have an impact it`s not going to be good for me.

So you`re going to see Republicans moving away from towing the President`s line and more hopefully toward thinking for themselves.

MELBER: Well let`s tease that out, because we`re here two days out, it`s getting very real. And the question ultimately with what is known. The closer you are to this, the closer you follow the news, the more you read your "New York Times" updates, your "Wall Street Journal" updates, the more you`ve seen, gosh, it got pretty bad. And then people walk back in the White House what they admitted to, that`s how bad it was.

If you`re paying less attention, and as we always note, a lot of people, a lot of voters are busy with their lives, with a job or two jobs, and so if it`s going to go public on Wednesday, do you think that the Republicans here are saying well more people finding out about what are the public facts is going to help or hurt Trump`s case?

GAY: I think it`s going to hurt Trump`s case and I think that the Republicans understand that and are starting to hedge their bets. The question is whether these impeachment hearings, when they are done in full view of the public - is that going to break through all the other noise? And are Americans going to stop and watch their TVs the way they did with the Kavanaugh hearings, for example. And just say to themselves wait a second, something isn`t right here.

I mean, ultimately, this is a case in which the President of the United States apparently was not working on behalf of the American people, but was in fact selling out our government and weaponizing it against his political enemies, while at the same time inviting foreign governments to interfere in our election.

That`s a pretty clear case. And when it`s coming out of the mouths like - of people like Vindman, it`s going to be extremely difficult for the Republicans to hide behind just process.

MELBER: And that goes to why, Berit, as we`re going get to later in the show, there are Trump aides who are basically sending people to court right now looking for guidance about what to do. Because at the end of the day, people understand if they`re in government, this isn`t just about patriotism and speaking out, some people have really put their neck on the line.

But now that it`s out, if you are too close to some of this stuff, you`re not the President, you can be indicted in office. We`ve had in this country a Vice President face it, we`ve had other aides face it. There is no immunity that goes anywhere near anyone but the President.

That part is debated. I put that to with you with new comments from Congresswoman Jackie Speier, picking up on something we`ve been reporting for a while, which is that constitutionally, there is a strong case here of bribery, which is impeachable. Take a look.

(BEGIN VIDEO CLIP)

REP. JACKIE SPEIER (D-CA): The President broke the law. He went on a telephone call with the President of Ukraine and said I have a favor, though, and then proceeded to ask for an investigation of his rival. And this is a very strong case of bribery.

(END VIDEO CLIP)

BERGER: I think the Democrats are smart to be moving away from the language of quid pro quo, aside from the fact that nobody really understands the full meaning of this Latin phrase, but bribery is something that people do understand. People understand what it means to say give me dirt or I`m not going to give you aid. People get that.

And I think as the democrats are facing the next challenge--

MELBER: Well, and let me press you on that. Not only - that`s a clarity reason, and prosecutors and lawyers care a lot about that when you`re talking to a jury, and - but the American public is the ultimate jury. Just people, not picked for any other reason than being citizens, right, and being in good standing, I suppose. But it`s deeper than communication.

There are only two specific offenses, as we`ve reported on this show repeatedly in the constitution that are explicitly impeachable. Other stuff may be, but you have to debate what a high crime is. Bribery is in there.

BERGER: Absolutely. And so you`re 100% right. They`re smart for the narrative part of this, which is one of the big goals for the coming hearings is to paint the narrative for the people. But when you get down to the nitty-gritty, what do you actually have to show to cross the line from being improper to being impeachable? And if they can make a strong case that this is bribery, they have crossed that line over into impeachment.

MELBER: I want to get to some of the reporting you`ve done on Giuliani. But before we get there, Shelby, I want to look at the strongest defense on the Trump side. It hasn`t come from Donald Trump, it hasn`t come from the White House.

But I do want to show you one of the best communicators I think the current Republican Party has, which is Nikki Haley, and she kind of backs away from the whole thing and makes it kind of - if you`re not listening that closely, it might sound wait a minute, is that big. Take a look.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Do you think ultimately the President will be impeached and removed from office?

NIKKI HALEY, FORMER UNITED STATES AMBASSADOR TO THE UNITED NATIONS: No. On what? You`re going to impeach a President for asking for a favor that didn`t happen and giving money and it wasn`t withheld? I don`t know what you would impeach him on.

(END VIDEO CLIP)

SHELBY HOLLIDAY, THE WALL STREET JOURNAL REPORTER: We`re hearing that - and like you said, we`re maybe not hearing that from Trump himself, but we are starting to hear that from more and more Republicans. The aid was released. Look at the transcript, there is no quid pro quo.

You know, I think there are some key themes that Democrats have to be quite focused on in the hearings or else this isn`t going to go well for them. Because you have not just Rudy Giuliani`s role, but questions about the quid pro quo, there is also quid pro quo regarding a White House meeting.

"Wall Street Journal" reported that Lev Parnas, Giuliani`s associate delivered this quid pro quo message in February to Petro Poroshenko, then Ukrainian President - if you want to come to the - if you want to come white house you, have to announce these investigations. Then it happened with Zelensky, allegedly. So you have a lot going on.

You have Rudy Giuliani. You also have Ambassador Yovanovitch, and that`s a key point. Why was she removed? Who was behind that campaign? There is a lot to focus on. And a lot of these witnesses have shared interesting information about those three key themes, but will democrats focus on this one idea of bribery?

Can the message get away from them? Some of these witnesses - Republicans have time to question them as well, and they want to go down different roads. So it will be interesting to see if Democrats can actually stay focused on this one key point. And at the end of the day, will Americans be tuning in to hear it.

MELBER: Well, Berit - this is where it`s legalish, but it`s not purely legal and it`s a Senate trial not a criminal trial. And what Nikki Haley is appealing to is people who watch Law & Order and think well, yes, attempted bribery or attempted embezzlement, or attempted extortion sounds bad, but attempted is not as bad as pulling it off.

Is there a reasonable way for them to lean into that? Although I would note, I have to as a journalist, the facts of the case suggest it may have been more than attempted. But that`s that they`re trying to do.

BERGER: Right. I mean, you nailed it. There is literally no legal distinction here. If this was a court of law, I mean, there is a charge of only attempt - conspiracy to commit a crime. And conspiracy to commit something is punished just as severely as the actual crime itself. So legally, this is the distinction without any meaning here.

MELBER: And attempted murder - bad.

BERGER: Yes.

MELBER: Right. You don`t get very far in a real courtroom. I mean, like look, my client only tried to do this and couldn`t pull it off, depending what the offense is. And again I go back to the - then you bring in the constitution.

And you say the constitution says, look, the bribery thing is exactly what we`re concerned about, because if officials who have such Unitarian executive power - we know the President does, particularly on foreign policy.

If you can auction off things, if you can auction off a bombing here, a pardon there - and the pardon power is almost never reviewable to use the legal jargon. Right? You can pardon almost anyone for any reason. But you can`t sell a part.

BERGER: Exactly. And that`s why the Founders were so explicit in putting bribery in there as one of the ways in which you could remove a President, because it is so fundamental to what we think is - how a government should run. That these are things like you said that shouldn`t be for sale.

MELBER: Before we go, Giuliani, do you have anything on that?

GAY: I`ll let Shelby handle that.

HOLLIDAY: I just think it`s interesting where you look at this may meeting where the President is telling Sondland and Volker and Perry, talk to Rudy, talk to Rudy all the way through the summer when Giuliani is, obviously, publicly campaigning for these public investigations. But the President is very explicit. you`ll have to talk to Giuliani.

In that phone call with Zelensky, I`ll have Giuliani give you a call.

MELBER: Right. And this is where it overlaps with what we did learn from the Mueller report, which is Bob Mueller documented the level of intent by this President. When he has bad things he wants to do, whether he pulls them off or not, suddenly the room gets clear. It`s a one-on-one.

When he has bad things that he doesn`t even trust to pressure Comey with, suddenly Lewandowski gets pulled into it. Right? This is classic criminal intent, which doesn`t mean they have proven the whole case. We have to report on it. But that`s the intent part. So--

HOLLIDAY: Like Michael Cohen.

MELBER: I know you`re fired up about this. I`m not going to tee you up, and you`ve been reporting on this for a while. On the Parnas front, this is Giuliani`s associate, says this meeting about a demand for the Biden inquiry if corroborated, "Would reveal the earliest known incident of American aid being tied to demand for Ukraine to take action that could benefit Trump`s reelection." Explain.

HOLLIDAY: Well, that`s significant, if corroborated because right now the other people in the meeting are denying this. But if it is true, it`s significant, because the President - Nikki Haley, the President`s allies have said the aid was ultimately released and the Ukrainians didn`t even know the hold on aid existed until after the phone call.

But if this message was delivered in May that is months before the phone call happened, and it has this implicit threat, allegedly according to the reporting. You know, this is Parnas` story you have to be clear about that. But it`s a message that you won`t get your aid if you don`t open these investigations.

And it wasn`t so much about investigating it, it was about announcing it publicly on TV or in a publication just the announcement of an investigation and that is something that would benefit Trump.

MELBER: Well, Mara, it`s almost as Donald Trump, who may be new to politics, he claims, learned something in 2016 which is just talking and announcing investigational material is enough to damage someone even if they`re ultimately not charged.

GAY: That`s right. Let`s just remember here that we don`t actually need to prove that a crime took place to impeach a President. It is actually not a criminal proceeding, as you pointed out, Ari. And there may have been crimes here, but that`s actually beside the point in terms of abuse of power.

And the real question is who`s going to have the more powerful story? Someone like Nikki Haley is telling a very compelling story for those who don`t want the pay attention. Are we going to be looking at facts, though, or propaganda? Because what she is talking about is ultimately propaganda. It`s not based around and actual sequence of events.

So there is an opportunity here not just for the Democrats, but for those who believe that something - that there was an abuse of power, to make their case before the American people this week, and to cut through the noise and tell a story. And this is about storytelling, as much a political process as a legal one.

MELBER: Well, I think you lay that out really well, and it`s also a reminder of how interesting these times are. They may be heavy, but they`re interesting, because the way you just put it is the gap between Nikki Haley minimizing, maybe nothing happened, which is often the first defense you hear in any situation, except Donald Trump`s number one top aide - you or me? It could be anyone.

GAY: Siri (ph).

MELBER: Siri.

GAY: She wants to weigh in.

MELBER: I would be curious to what Siri has to say. The algorithms have all kinds of ways of evaluating evidence. But you have - the Nikki Haley defense is hey, maybe nothing happened. And that might have appealed to a lot of people except Mick Mulvaney came out and said oh, something happened, something we do all the time. We do this. Get over it, until he had to retract.

Great insights from every panelist. Thanks to each of you.

HOLLIDAY: Thank you. Interesting--

MELBER: Really appreciate it Mara, Berit, Shelby, we`ll be seeing all of you again.

Coming up, as promised, I`m going turn next to my special report between Mick Mulvaney and tap dance between defying Congress and asking a judge whether he should defy his own boss, Donald Trump.

Also, later, republicans try out this new defense, admitting yes, maybe he actually did something wrong.

And tonight Neal Katyal is back on THE BEAT about Trump`s attempt to abuse a privilege to hide the facts.

And later, my take on the evidence and some of the drama emerges from, yes, the ongoing trial of Trump aide Roger Stone. I`m Ari Melber. You`re watching THE BEAT on MSNBC.

(COMMERCIAL BREAK)

MELBER: Now to our special report tonight with major implications for where impeachment is headed. We begin with a fact of life for Presidents under investigation, be it congressional or criminal investigation, there is major pressure on their most trusted and senior aides to testify.

That puts the aides in a tough spot between their obligation to cooperate, their obligation to their boss, and the legitimate limits on what they say. President Clinton`s advisers faced that pressure during the Whitewater probe from his spokesman and confidante George Stephanopoulos, remember when he was doing politics; to key counsel Bruce Lindsey to Sidney Blumenthal, a loyal Clinton adviser who cooperated with the grand jury in testimony that later became public.

He famously told jurors that he asked President Clinton what have you done wrong? And the President replied nothing. And then after cooperating, Blumenthal faced the cameras dramatically on the courthouse steps and criticized Ken Starr for hauling him before a grand jury under those circumstances.

(BEGIN VIDEO CLIP)

SIDNEY BLUMENTHAL, FORMER AIDE TO PRESIDENT BILL CLINTON: I never imagined that in America I would be hauled before a federal grand jury to answer questions. If they think they have intimidated me, they have failed.

(END VIDEO CLIP)

MELBER: Now there are many example of aides walking this line throughout history, and not just in the often cited impeachment examples of Clinton or Nixon. President George W. Bush faced an investigation with some parallels to today`s Ukraine scandal and the President has major foreign policy powers, but that`s what makes their potential abuse so significant.

These could be matters of life and death. Bush aides found themselves interrogated by the Mueller of their era, Patrick Fitzgerald about alleged abuse of powers. Those same foreign policy power, outing a CIA operative for allegedly political purposes.

Think about that. Abusing national security powers for politics, that`s a crime. And soon some of bush`s most trusted aides were under a microscope, testifying like Karl Rove and Alberto Gonzales, or indicted and convicted like Scooter Libby. And related--

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: --and before the Secretary General, Alberto Gonzales told a congressional panel he made mistakes and insisted politics was not a factor in the firing of eight federal prosecutors.

(END VIDEO CLIP)

MELBER: That was the time when Mr. Gonzalez was testifying to Congress about their investigation. He ultimately was ousted over some of those issues. Now there were those battles then. President Bush claiming executive privilege in trying to prevent Rove and others from facing congress.

Why am I telling you all this right now? Well, there is context for this pickle that Mick Mulvaney is in tonight, right now as his team goes to court arguing whether he can testify against Trump, and there could be legitimate limits on testimony - classified material, privileges that do apply.

And now on the list of current Trump aides, Mulvaney is number one. Not only in the org chart, but also in allegedly overseeing the Ukraine bribery plot, including his famous televised confession.

(BEGIN VIDEO CLIP)

MICK MULVANEY, ACTING CHIEF OF STAFF: Did he also mentioned to me and past that the corruption related to the DNC server? Absolutely, no question about that.

REPORTER: Just to be clear, you just described is a quid pro quo.

MULVANEY: We do that all the time with foreign policy. That`s it, and that`s why we held up the money.

(END VIDEO CLIP)

MELBER: That`s it, so emphatic. But that was not it, as we reported in a breakdown on "THE BEAT." Mulvaney`s press conference made him appear among the witnesses stating there was bribery, there is. Only to move back as he tried to retract his own televised confession. So Mulvaney has done a lot to make himself an even more sought after witness and to impeach his only credibility, so to speak.

Whatever anyone thinks of Mulvaney, and he does look a little guilty, because he confessed and then took it back. In fairness, his situation does reflect a tension other aides have faced when pressed to testify. And that`s the context for one of the strangest turns in impeachment right now.

Call it Mulvaney versus Trump. Mulvaney trying to join a lawsuit against his boss Trump. Mulvaney`s team is in court tonight with a move that makes fitting headlines for a year where it seems like everything has already happened. But not this, he is trying to join this lawsuit against Trump that basically asks a court to decide if Mulvaney should testify against his boss.

Now that is unusual. Mulvaney could just fight this request outright, arguing executive privilege, for he thinks the truth is good for him. And Trump, he could just go down and testify, right? He has already made this whole argument on live TV. He could make it again to congress or he could adjust it. But instead, he is trying to join the lawsuit against Trump with an ousted Trump aide Charles Kupperman who was a former deputy to John Bolton.

And Bolton is key here because he has all kinds of bad things reportedly to say about the bribery plot. He even reportedly said he want wanted no part of a, "Drug Deal" that Sondland and Mulvaney are trying to cook up.

So Mulvaney is trying to join forces with person who accuses him of cook up a drug deal, John Bolton, who is flabbergasted at the move. The "Washington Post" reporting the whole thing highlights the internal divisions in Trump land. The implication here is that Bolton`s deputy is making a genuine request to a judge to be given the green light to talk, while Mulvaney is jumping into muddier waters.

And maybe seize on the ruling if he gets support for the Trump position opposing talking. A strategy here is basically this wouldn`t cost Mulvaney much. If he gets a ruling forcing him to talk, he could go back to try to defy these other requests like other Trump officials have. That`s the gamble.

But before we bring in our experts, look at the substance here. Bolton`s deputy is making a serious argument that like other aides before him, he is now caught between the competing demand of Trump and Congress.

And in a nod toward the significance of the Democrats` impeachment probe, Bolton`s deputy says if he choosing wrong or if he clams up too fast, he could inflict grave constitutional injury on the house impeachment probe.

And finally, this brief cites some precedent that Trump and presumably Mr. Bolton may be concerned about, that congress has more power to force testimony when probing, "misconduct by impeachable officials" - impeachable officials. Well, the President is the most important impeachable official there.

So while these White House officials do follow a long line of aides who do wrestle with these dilemmas, and some of them are real, rarely do you see a chief of staff join a suit against his own boss, the President, or what Mulvaney is doing this evening, asking a court to tell him whether to reject his own President`s order or make common cause with other officials who`ve accused him of a bribery plot that may be impeachable, let alone an official who reportedly accused him of cooking up a drug deal.

So as with so much in 2019, this is a little different. What happens next in this case after that hearing late today, well, we`re back in 30 seconds with two experts on all of this.

(COMMERCIAL BREAK)

MELBER: We are back with breaking news. You cannot make it up. I was handed news on the Mulvaney suit as i was doing this breakdown. Remember all the pressure i just walked through? How it`s odd that Mick Mulvaney is making common cause with these critics of Trump, which is what they were attempting to do in court today.

Well, I`m holding here the news. Lawyers for Mick Mulvaney saying they are now withdrawing formally the motion motion to intervene in this very case, but instead will, "file their own lawsuit as a separate case," meaning this entire controversy is still very much alive, but Mulvaney perhaps buckling to some of this late-breaking pressure about who he was working.

As promised, we bring in Mother Jones Washington Bureau Chief David Corn and former federal prosecutor . Good evening, gentlemen.

DAVID CORN, WASHINGTON BUREAU CHIEF, MOTHER JONES: Good evening.

MELBER: David, this is one of those nights. I got handed this as we were doing the breakdown. Your view of both the larger arc, which is Mulvaney still not taking Donald Trump at his word and requesting he clam up.

And also what it means with the late-breaking news that he is not going to do it through the vehicle of the guy who accused him of cooking up a drug deal.

CORN: My head is still spinning from your crystal clear explanation of this issue, because it is rather complicated and does seem to cut against some instinctual positions.

I mean, the key thing to keep in mind here is that Mulvaney in testimony that`s come out recently gets more of a central role in the extortion, bribery scheme, whatever you want to call it. When Fiona Fiona Hill, the top Russian adviser in the House and - when her testimony was released the other day I thought one of the key points was. It wasn`t just Giuliani who was cooking up this pressure scheme against the Ukrainians, it was Giuliani and Mulvaney.

And as you noted in your wonderful set up when John Bolton referred - "see the fact that I won`t be part of any drug deal, meaning any illegal and proper arrangement, he called it Sondland`s and Mulvaney`s drug deal--

MELBER: Well, he said cooking up - you`re making an inference. He could have meant that he was worried about them using heat or fire to create drugs in the White House.

CORN: Yes, exactly they`re doing--

MELBER: --they`re not ruling that out.

CORN: Yes, exactly. They are doing crystal meth there. They are watching Breaking Bad and that`s what they`re doing, which might be an easier route for them and then what they`re actually involved in.

MELBER: I mean, actually one could argue that the some of the penalties for low - certain low-level drug offenses are lower than the kind of federal corruption cases politicians to prosecute.

CORN: And that`s why they want criminal justice informed. But Mulvaney has gotten to be a more critical player. Plus, as you know, there was this confession--

MELBER: Yes.

CORN: In front of national TV. And so the fact that he`s talked about this openly and publicly certainly would undermine any claim he has--

MELBER: Any privilege--

CORN: --to absolute immunity--

MELBER: Before I go to Paul.

CORN: --which is they say, not just executive privilege, but absolute immunity.

MELBER: Before I got to Paul--

(CROSSTALK)

CORN: --what it is.

MELBER: Yes, David on the - before I got upon the law, on the Washington of this, it`s a very Washington story. There was pushback, there what scrutiny, obviously it seems breaking news, but my read on it would be Mulvaney has buckled to some of that pressure.

Do you view that as a thing where Trump and the pressure that Mulvaney is under they care more about how it looks than the underlying litigation.

CORN: I think - well, you had Kupperman and John Bolton whose party to the suit saying get out of here, we don`t want you. We - are reasons for bringing this suit are different than yours. We are talking about national security matters. You`ve already confessed - and I think they saw his involvement as - a polluting the case.

And so I don`t know to what degree Trump came in and said do or don`t proceed with this, but it really raised so many eyebrows that it seemed that he was basically trying to join a party that didn`t want him anywhere near the punch bowl. So that might have been the bottom of it. But as the main issue of to testify or not to testify still remains front and center for all of them.

MELBER: Paul you`ve been sitting here with me thinking this all through. What is the significance that - again, reading from the breaking news it says Mulvaney will still file his own lawsuit - a separate case.

Which means the core of what we were just reporting on, that rather than saying yes Mr. President, obviously there`s a good reason not to testify. Instead he`s saying, no Mr. President, I kind of got to get some outside ruling here.

PAUL BUTLER, FORMER FEDERAL PROSECUTOR: Yes. So Ari if your boss the President tells you not to testify, but the Congress orders you to testify what do you do, that`s the issue before their courts.

And both Kupperman and Mulvaney were in a similar situation, but there are crucial differences. First, Kupperman is suing both Congress and the President. Mulvaney only wants to sue Congress. Again, he`s going along with what Trump wants him to do.

Kupperman is a former employee. Mulvaney still is the Acting Chief of Staff and the Head of the Office of OMB. And the biggest difference though is that Kupperman is neutral. He really wants to know the answer. He`s between a rock and a hard place - between the Congress and the President.

Mulvaney is all team Trump. And so we can assume that whatever he`s doing, including this bizarre move of joining in this lawsuit is in the interest of Donald Trump.

MELBER: So what is the interest? I mean, that`s a little bit of a different theory than David. Why go into court at all?

BUTLER: Again, it could be some stalling tactic. There`s no case or controversy with Kupperman now. So it sounds like what happens is the judge that said, look, Kupperman came in to see if he has to obey the subpoena. Congress withdrew the subpoena.

MELBER: In that particular instance--

BUTLER: In that case Congress says, whenever people who are part of the administration say that they`re not going to testify, we`re just going to chalk that--

MELBER: We`re going to go, we`re going to roll right by it. But Bolton is still seeking this.

BUTLER: Yes. And so there are other court cases in which judge will decide the same issue. Don McGahn, way back to the Russian investigation, he`s in the same position. He`s a former employee. Again, he`s been subpoenaed. He asked the court to tell him what to do, should he obey the President or Congress. That case is the furthest along. So that will--

MELBER: And that`s different. Although, Bolton`s lawyers have argued that the McGahn case is potentially weaker for Pelosi and the Democrats than this one, because here the full force of impeachment powers are without a doubt in play.

BUTLER: That`s exactly right. So one of the benefits of this being an official impeachment inquiry is that Congress has the right to a lot more evidence and the President`s claims of absolute immunity or executive privilege don`t have the same force as if there`s not an impeachment inquiry.

MELBER: So David you`ve you feel like this is MSNBC or court TV tonight? I mean, we`re right in it. I want to broaden back out. If everyone`s saying, all these names and all these suits flying by, we`re still talking about the number one Trump aide who handled the money, who was incredibly accused by other people of being the instrument in House - Giuliani outhouse, but he in House of the bribery plot.

And then went out on TV, as you emphasize - and you can`t emphasize this enough when you have something like this happen and said, yes quid pro quo bribery, we do it all the time. Get over it, then tried to retract that. And so that`s where, if he does testify in public, we`re going to see some version - the most recent Mulvaney 3.0 which is we call that around here post full Mulvaney, is what we saw on Fox. Take a look David.

(BEGIN VIDEO CLIP)

CHRIS WALLACE, FOX NEWS HOST: You were asked specifically by Jonathan Karl was investigating Democrats one of the conditions for holding up the aid? Was that part of the quid pro quo and you said it happens all the time.

MULVANEY: Yes. But go back and watch what I said before that there is not a quid pro quo--

WALLACE: You were asked by Jonathan Karl is that you`ve described a quid pro quo and you said that happens all the time.

MULVANEY: And again reporters will use their language all the time. So my language never said quid pro quo--

(END VIDEO CLIP)

CORN: Well, he`s doing what his boss does, right? Just denying reality and trying to gaslight people who saw very clearly what he said. Earlier today we had Donald Trump say that the Democrats are doctoring the transcripts coming out of the investigation when there`s absolutely no evidence of that.

And one big question from Mulvaney is he was the Acting Chief of Staff, the Acting Head of OMB, he`s acting everywhere. But the people who participated in the Ukraine foreign policy decision-making still don`t understand and never got a clear explanation. We see this in a transcript that came out tonight of why the aid was being withheld.

MELBER: Right.

CORN: It never - if it was coming from the OMB--

MELBER: If there`s no batteries in--

CORN: --and it was always coming like suspicious.

MELBER: If there`s no batteries then what was the legitimate reason?

CORN: Yes. I mean, that`s - they never were given a clear understanding. And so they were all very a very suspicious. Mulvaney is in the middle of that. He`s in the middle of what John Bolton called the drug deal to put pressure on the Ukrainians. I mean, he`s a key witness.

And if you go back to Nixon and Watergate--

MELBER: Key witness he might be an alleged co-conspirator.

BUTLER: Which is why--

CORN: He might be that - and in the Watergate tape case the Supreme Court said you can`t hide wrongdoing under the cloak of executive privilege.

MELBER: So David you said gaslight.

CORN: I said gaslight.

MELBER: You`re raising the question of whether the alleged drug deal was cooking up crack with a gasoline.

CORN: A Bunsen burner? I think that`s how they did it in Breaking Bad.

MELBER: Well because the gaslight, I think, it`s from - it`s black-and- white film where it`s the light in the stove--

CORN: In the - in actually the lamp.

MELBER: In the stove, yes.

BUTLER: You know, just really quickly to the point about Mulvaney, he`s got to be worried about how that where whether Donald Trump is going to protect him. So they started out with this defense that there was no--

CORN: I`m sorry Paul.

BUTLER: --quid pro quo, that`s not going to work. A whole parade of witnesses to Congress has rebutted and - that there was an established conclusively that there was. Now it looks like team Trump is going to the, it wasn`t me defense - the Shaggy defense, "It wasn`t me". And they`re going to blame people like Giuliani and Mulvaney.

And so if I were Mulvaney or if I were Mulvaney`s lawyer I tell them to proceed with caution. Don`t assume that Trump is going to protect you.

MELBER: We`re over time. Too briefly - David final word on that, I mean, that`s what happened to John Dean. He saw it coming at him and that`s part of what changed his mind. And - but we have now testimony already saying talk to Rudy - talk to Rudy coming from Trump.

So Trump acts like the Mafia style Don who says, you know what, I want to fix this thing. You talked to Rudy. He knows what to do. Rudy knows what to do. So it`s going to be very hard for these guys - for the White House to pin it on Rudy or Mulvaney when we have the testimony Trump directed people in those directions.

MELBER: Yes, David Corn, Paul Butler on a night of breaking news, handed to it while we were doing this very story. Thanks to both of you.

MELBER: Coming up we`re going to get into Roger Stone trial. And later Trump`s stonewalling Republicans with a new defense, we`ll explain. Neal Katyal is also here for opening arguments when we come back

(COMMERCIAL BREAK)

MELBER: It`s getting real. We are now two days out from the first public hearings in this impeachment probe. Some Republicans are now trying to argue what might be a different, but better defense for this troubling set of facts. Basically admitting President Trump did something bad, even very bad, while emphasizing they don`t think it`s impeachable.

(BEGIN VIDEO CLIP)

THORNBERRY: I believe that it is inappropriate for a President to ask a foreign leader to investigate a political rival. I believe it was inappropriate. I do not believe it was impeachable.

HALEY: I think it is not a good practice for us ever to ask a foreign country to investigate an American, I don`t. Impeachments a serious issue and I just - I don`t see it as impeachable.

(END VIDEO CLIP)

MELBER: That interpretation may differ from what many see is the Founding Fathers` clearly stated version of what is impeachable, something we`ve reported repeated on this show - bribery.

Now what do you do with this reality, well, Donald Trump doesn`t even like this defense. He is putting people on blast, writing "Republicans don`t be led into the fool`s trap of saying it was not perfect, but it`s not impeachable." No, it`s stronger than that, nothing was done wrong.

I want to bring back former Acting Solicitor General Neal Katyal who`s argued dozens of cases before the Supreme Court, part of our "Opening Arguments" series. And I`m thrilled to tell you Neal has a new book you may want to read. It is called "Impeach: The Case Against Donald Trump," it`s coming out this month and it looks very intriguing to me.

NEAL KATYAL, FORMER FEDERAL PROSECUTOR: Congrats on that and welcome back. Thank you. Well, thank you.

MELBER: Your view of this new argument and Donald Trump, always a difficult client, pushing back against even this defense.

KATYAL: I mean, dios mio. I mean Ari I mean inappropriate is like when a President wears a tan suit or something like that. The allegations here are just about as serious as that is one could imagine, the President going secretly and asking another government to dig up dirt on his chief political rival and withholding aid in the process.

And what Nikki Haley said was, well, he didn`t succeed, he didn`t get away with it, which is a terrible argument. I mean that`s like saying well I tried to shoot and kill the guy I missed therefore no harm no foul. That argument doesn`t work too well in court.

The crime is called attempt. It`s called solicitation, it`s called conspiracy. There any number of ways to put it in. And Ari as you`ve said and written so eloquently in "The Washington Post" bribery is one of the few offenses - one of two offenses that the Founders actually put in the Constitution as a high crime and misdemeanor. So I don`t think this argument is going anywhere.

MELBER: Believe me, sir, when I was in law school the idea that you would mention any of my legal writing was would be beyond my capacity of imagination. That`s very nice for you to say. Viewers may recall, because we`ve discussed it and I did a piece on TV off that piece, but we are seeing, as I`ve reported, a lot of people digging into the bribery part of it.

There`s this other thing I know you have something to say about, which is the idea with Donald Trump, we`ve seen it in these lawsuits, we`ve seen the further skirmishes over, at least with key star witnesses. Can they hold back on testifying or will they ultimately use privilege something we`ve been reporting on to limit the key testimony that they might or would have to give. Your view on the privileged battles to come.

KATYAL: Yes. So there`s a descriptive piece which are asking about, which is like are these privileged claims going to succeed and so on. But to me there`s a much more important normative one, which is, as Americans go into these hearings on Wednesday, which are you know a moment of civic education for the whole country to understand what our Constitution is about and what the President did.

I think the Wednesday hearing is going to focus a lot on what the President did with respect to Ukraine and rightly so, because of all this evidence about bribery and so on. But what isn`t being said is just as important as what`s being said.

And what isn`t being said is that the President has stopped all of his senior advisors in the executive branch from going and telling the truth to Congress. And the testimony we`re getting on Wednesday and the testimony we`ve gotten in these depositions is because brave White House and executive branch officials have said I`m not going to listen to you Mr. President my job is to the Constitution and I`m going to go tell the truth.

And as we think about what is an impeachable offense, and Ari I completely agree with you, that bribery is a centerpiece, but so too is the President`s conduct here. He`s trying to keep the truth from the American people about what happened and that is crucial.

MELBER: Let me throw up some evidence for you counselor and you walk us through it. Because it`s possible - we were talking about this higher in the show. That as Americans tune in some may say well wait a minute, is this a just partly a battle with Congress? Is that really what impeachment is about?

And the answer is, well, it depends on whether the executive is abusing power to an extreme degree. Here we have the impeachment articles that at least made it through Judiciary Committee in the past.

Andrew Johnson, defying Congress; Richard Nixon, defying congressional subpoenas; Bill Clinton, allegedly lying to Congress, whatever one thinks the underlying facts it would seem that if there`s one President in common, Neal, it`s that a President who tries to subvert the other two branches of government does face a credible precedent for that being impeachable.

KATYAL: 100 percent, Ari, and I`ll write in an op-ed that`ll come out in about 24 hours that actually Nixon - he tried at the beginning to use executive privilege to say witnesses can`t forward, I`m going to bar them, just as the President here has done. But you know what, Nixon actually backtracked on that. Nixon said at the end of the day, he`s going to let those witnesses testify.

So here you`ve got President Trump who`s basically out Nixoning Nixon, and that is what I think is so damaging. And it`s not like he can say, oh this is some impeachment proceeding coup against me, it`s all stacked against me and after all the majority of the Senate, which is going to try the case, is composed of people from his own party.

So the idea that you got to like resist at all costs and like you can`t even let the truth come out is I think a bit preposterous. I think you lay that out well and it`s a reminder for people who are interested in the substance. It is a Senate trial in a Senate controlled by his party.

Why wouldn`t you, if the facts are on your side, seize on that to lay it out what happened, what was on the call, what did you do? What was, as a earlier guest raised the question, what was the legitimate reason to freeze the funds? All that stuff. We`re not - certainly not seeing that defense yet.

And Neal Katyal, thank you as always. And everyone at home if you want more Neal and why wouldn`t you, go to msnbc.com/opening arguments, you`ll see tonight`s video - tonight, as well as his recent breakdowns, a lot of them quite relevant. And again book "Impeach: The Case Against Donald Trump," comes out later this month. I`m sure you can pre-order it online.

Now, still ahead, one of the most prominent guilty Trump aides from the Mueller probe is back. We`ll tell you why with this dramatic footage coming out of the Roger Stone trial. That`s just ahead.

(COMMERCIAL BREAK)

MELBER: Now to another story we`re following that gets crowded out by the other big news, Donald Trump`s longest serving adviser Roger Stone is on trial right now for multiple felonies and it is about to get hot, because Rick Gates, the guilty former trump campaign aide and Paul Manafort partner will testify for the prosecution.

And today the feds said after Gates takes the stand, he will then have completed his cooperation from the Mueller probe and will be sentenced. Gates, of course, is one of many Trump linked witnesses in this trial.

Steve Bannon cutting through part of Stone`s defense by telling jurors already - jurors about this that he saw Stone as a, "access point to WikiLeaks" and claimed Stone boasted about his links to Julian Assauge that Steve Bannon testifying for the government against Stone.

He also said Stone discussed WikiLeaks more than once, which conflicts with Stone telling Congress that he never communicated with any trump officials about WikiLeaks. Now Stone is presumed innocent. He pled not guilty to obstruction, witness tampering and lying to Congress.

Meanwhile, John Oliver has been following the case and he has his verdict.

(BEGIN VIDEO CLIP)

JOHN OLIVER, LAST WEEK TONIGHT WITH JOHN OLIVER, HOST: --my favorite piece of Roger Stone merch is without a doubt this actual product, a Roger Stone stone. This actually might be the perfect emblem of this whole stupid time we`re all living in.

Because if one of the President`s key allies is a discount Dick Tracy villain, we may as well all face it at this point, we all hate literal rock bottom.

(END VIDEO CLIP)

MELBER: Rock bottom. Get it? Well, to paraphrase a great MC, "Next phase, new wave, it`s still rock `n roll to me." You know who that is? You can tweet us about it. Coming up we have one more update for you on the famous tax fight. That`s next.

(COMMERCIAL BREAK)

MELBER: Another update, we promised, is a development in the Trump fight over tax returns. A federal judge in Washington dismissed Trump`s lawsuit seeking to block House Democrats from a New York State law that would obtain his returns.

The judge says, "Trump can`t actually sue new york officials in federal court" and added, "Trump could sue potentially in New York State." So that case will continue if he sues again. And that`s it for me. "HARDBALL" is up next.

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