WASHINGTON (CNN) -- Democratic activists began a potentially explosive hearing Saturday on how to seat the Michigan and Florida delegations.
Members of the Democrats' rules committee discuss the delegate issue Saturday.
Supporters of Sens. Hillary Clinton and Barack Obama disagree over how best to address the situation of both states, which were penalized for holding their primaries early.
The Democratic National Committee excluded them from representation when the party nominates a candidate at the August convention.
But the Democratic presidential hopefuls have both said they want the Florida and Michigan delegates to attend the convention. CNN.com/Live is carrying the meeting in its entirety.
Clinton's campaign is calling for the results of the states' primaries to be honored and the delegates awarded based on the results. That approach would help her chip away at Obama's lead in pledged delegates because she handily won both states and would be awarded a greater share of the delegates.
Obama's campaign disagrees, saying he followed the rules, took his name off of the Michigan ballot and did not campaign in either state. See what the fuss is all about »
Dozens of sign-toting, chanting protesters gathered outside the Marriott Wardman Park Hotel, the site of Saturday's events, to have their say on what the decision should be.
Some of the signs read, "Count our Florida votes" and "Rules, what rules?"
The Democratic National Committee's Rules and Bylaws panel met behind closed doors for five hours Friday night, emerging at 1:30 a.m. Saturday without an agreement.
"It was a full discussion," said Harold Ickes, a DNC rules committee member from the District of Columbia who supports Clinton. "I think there was some agreement on some issues and still some disagreements on others."
With no Michigan or Florida delegates included, Obama leads Clinton by 202 delegates. He needs 42 more to clinch the nomination.
"Right now what we have to do is to figure our way through all of this, and I believe we will," said Allan Katz, a DNC rules member from Florida who supports Obama. "And I believe we will come up with something [Saturday]. There will probably be a little sort of tussling but we are Democrats." Follow a timeline of the dispute »
The rules committee will address two main issues at the hearing Saturday morning: how many delegates each state is allowed and how those delegates will be allocated between the two candidates. Watch who will really decide the nomination »
"How do you recognize the people who didn't vote and how do you recognize the people that did vote and how do we at the same time maintain the integrity of the process?" said Martha Fuller Clark, a DNC Rules Committee member from New Hampshire and Obama supporter. "And there are no easy answers."
James Roosevelt Jr., the DNC Rules committee co-chair from Massachusetts, described the overnight meeting as "spirited because people on this committee have a strong feeling about the rules and about the importance of them." But he added, "It was not unpleasant or heated."
Roosevelt also predicted a resolution will be reached, but said there would be dissenting votes.
"I can't predict that it will be unanimous," he said. "I do think that it will be unifying for the party."
In a letter addressed to the co-chairs of the rules committee, Clinton lawyer Lyn Utrecht said Friday the panel is compelled to seat both delegations from Florida and Michigan fully and not award Obama any delegates from Michigan.
"It is a bedrock principle of our party that every vote must be counted, and thereby every elected delegate should be seated," Utrecht wrote.
The letter said party rules do not allow "arbitrary reallocation of uncommitted delegates to a candidate or arbitrary reallocation of delegates from one candidate to another." Read the full letter (pdf)
Obama campaign manager David Plouffe told The Associated Press that receiving no pledged delegates from Michigan is not acceptable and "I don't think is a position that people find terribly reasonable."
Obama's chief strategist David Axelrod said his campaign wants "a resolution that allows Florida and Michigan to come to the convention, participate in the convention and do it within the rules of the party."
But Axelrod took issue with the Clinton campaign's approach to the issue.
"Everybody agreed that these contests would not be valid," he said, adding that Clinton reconsidered "when the race began to turn and her situation changed."
Florida Democrats voted 50 percent for Clinton and 33 percent for Obama. In Michigan, Clinton got 55 percent of the vote, and 40 percent of Democrats voted for an uncommitted slate.
"Some would take the position that perhaps ... their [Michigan voters] intention was to vote for Sen. Obama ... some would take the position that you can't know what the intentions of those voters were," DNC Communications Director Karen Finney said Thursday.
CNN's Candy Crowley, Ed Hornick, Alexander Mooney, Mark Preston, Josh Rubin and Bill Schneider contributed to this report.
Copyright 2008 CNN. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed. Associated Press contributed to this report.
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