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NEW YORK (AP) — A laid-off women's accessories designer shot a former coworker to death in front of the Empire State Building, causing a chaotic showdown with police Friday in front of one of the world's best-known landmarks. Police killed the suspect and at least nine others were wounded, some possibly by police gunfire, city officials said.

Some of the wounded were grazed by bullets and others hit directly, but all were expected to survive, officials said.

The gunshots rang out on the Fifth Avenue side of the building at around 9 a.m., a time of day when the sidewalks around the building are packed with pedestrians and merchants were opening their shops.

"People were yelling 'Get down! Get down!", said Marc Engel, an accountant who was on a bus in the area when he heard the shots. "It took about 15 seconds, a lot of 'pop, pop, pop, pop, one shot after the other."

Afterward, he saw the sidewalks littered with the wounded, including one person "dripping enough blood to leave a stream."

After the shootout, crowds of tourists and people on their way to work gathered along 34th Street, which was shut down by police. Police helicopters buzzed overhead and swarms of officers were gathered around the crime scene.

Jeffrey Johnson, 58, who was laid off about a year ago at Hazan Imports, fired three times at the company's 41-year-old office manager, shooting the man in the head, Police Commissioner Raymond Kelly said. The two had traded accusations of harassment when Johnson worked there, he said.

Johnson walked away, and a construction worker who saw the shooting followed Johnson and alerted two police officers, a detail regularly assigned to patrol the 1,454-foot skyscraper since the 9/11 terror attacks, officials said.

Surveillance video footage shows Johnson reaching into a bag, pulling out a .45-caliber pistol and pointing it at officers, Kelly said. The officers drew their weapons and started firing, killing Johnson, Kelly said.

Kelly initially said that Johnson fired on officers, but police said later they were trying to determine whether Johnson actually fired shots.

Erica Solar doesn't know who shot her in the back of the knee while she walked to get coffee on her way to work, said her brother, Louis Lleras.

"She just heard shots and she fell to the ground a couple of steps forward and noticed that she was shot," Lleras said.

The two officers fired a total of 14 rounds, he said. Mayor Michael Bloomberg said some of the nine wounded may have been shot by police in the mayhem. Johnson's semi-automatic weapon was equipped to fire at least eight rounds; at least one round was left in the clip, police said.

Johnson worked at the company near the building for about six years and was laid off because of downsizing, Kelly said.

"We were just working here and we just heard bang, bang, bang!" said Mohammed Bachchu, 22, of Queens, a worker at a nearby souvenir shop. He said he rushed from the building and saw seven people lying on the ground, covered in blood.

Queens resident Rebecca Fox, 27, said she saw people running down the street and initially thought it was a celebrity sighting, but then saw a woman shot in the foot and a man dead on the ground.

"I was scared and shocked and literally shaking," she said. She said police seemed to appear in seconds. "It was like CSI, but it was real."

Hassam Cissa, 22, of the Bronx, said he saw two bodies on the ground and police applying a white cloth to a man's stomach wound.

Gunshots so close to one of the city's leading tourist attractions immediately prompted fears of terrorism, but federal officials said that wasn't the case, and a guard at skyscraper said it didn't involve the parts of the building where tourists gather to visit the skyscraper.

The gunfire came less than two weeks after a knife-wielding man was shot dead by police near Times Square, another tourist-saturated part of the city. Authorities say police shot 51-year-old Darrius Kennedy after he lunged at officers with a kitchen knife Aug. 12. Kennedy was smoking marijuana in Times Square on a Saturday afternoon when officers first approached, police said. It was the beginning of an encounter that would stretch for seven crowded blocks.

In 1997, a gunman opened fire on the 86th floor observation deck of the Empire State Building, killing one tourist and wounding six others before fatally shooting himself.

Metal detectors and bag searchers have been standard at the 102-story skyscraper since the 1997 shooting.

Millions of tourists visiting New York ascend its heights to gape over the city from its observation deck, made famous in films such as "Sleepless in Seattle." It was 1933's "King Kong" that showed a giant ape clutching Fay Wray and fending off airplanes atop the tower.

Contributing to this report were Alex Katz, Samantha Gross and Julie Walker.

AUSTIN, Texas (AP) — The Texas attorney general has launched an Internet ad campaign inviting New Yorkers who feel their state's new gun laws are too restrictive to move to Texas.

Anyone accessing a variety of media sites from Manhattan or Albany starting Wednesday may be confronted with two pop-up ads.

One reads, "Is Gov. Cuomo looking to take your guns?" Another says, "Wanted: Law abiding New York gun owners looking for lower taxes and greater opportunity."

Paid for with Texas Attorney General Greg Abbott's campaign funds, the ads reference the nation's toughest gun control law. It was signed Tuesday by New York Gov. Andrew Cuomo.

The ads link to a Facebook site proclaiming, "Keep your guns, move to Texas."

The site says Texas has no income tax and created more than 275,000 jobs in 12 months.

MINEOLA, N.Y. (AP) — An unemployed man suspected of faking his own drowning at a New York beach to collect on life insurance has been re-arrested and will be freed on bail again.

Raymond Roth pleaded not guilty to the latest charges Thursday.

Nassau County prosecutors say Roth called his estranged wife Wednesday night.

His lawyer says Roth didn't understand an order of protection and had recently tried to commit suicide.

He was arrested earlier Wednesday on charges including conspiracy to commit insurance fraud. He pleaded not guilty and was released on $100,000 bail.

His son Jonathan, who told police his father drowned, faces the same charges.

After he vanished, authorities conducted an extensive search for days. Roth was reported to be in Florida. On Aug. 2, he got a speeding ticket in Santee, S.C.

DARIEN, N.Y. (AP) — Authorities say a 35-year-old man tried to swallow several counterfeit $50 bills after he was caught trying to use the bogus money at a western New York amusement park.

The Genesee (JEN'-uh-see) County Sheriff's Office says deputies were called to Darien Lake Theme Park and Resort on Sunday night after Larry Jones, of Buffalo, bought french fries with a $50 bill.

Deputies say a park employee determined the bill was counterfeit and called security. While being taken away, deputies say Jones stuffed five counterfeit bills into his mouth and tried to eat them.

Security officers retrieved the bills before Jones swallowed them.

Jones was charged with possessing a forged instrument and tampering with evidence and sent to the county jail with no bail. It couldn't be determined if he had a lawyer.

NEW YORK (AP) — Millions of people from Maine to the Carolinas awoke Tuesday without electricity, and an eerily quiet New York City was all but closed off by car, train and air as superstorm Sandy steamed inland, still delivering punishing wind and rain. The U.S. death toll climbed to 38, many of the victims killed by falling trees.

The full extent of the damage in New Jersey, where the storm roared ashore Monday night with hurricane-force winds of 80 mph, was unclear. Police and fire officials, some with their own departments flooded, fanned out to rescue hundreds.

"We are in the midst of urban search and rescue. Our teams are moving as fast as they can," Gov. Chris Christie said. "The devastation on the Jersey Shore is some of the worst we've ever seen. The cost of the storm is incalculable at this point."

More than 8.2 million people across the East were without power. Airlines canceled more than 15,000 flights around the world, and it could be days before the mess is untangled and passengers can get where they're going.

The storm also disrupted the presidential campaign with just a week to go before Election Day.

President Barack Obama canceled a third straight day of campaigning, scratching events scheduled for Wednesday in swing state Ohio. Republican Mitt Romney resumed his campaign, but with plans to turn a political rally in Ohio into a "storm relief event."

Sandy will end up causing about $20 billion in property damage and $10 billion to $30 billion more in lost business, making it one of the costliest natural disasters on record in the U.S., according to IHS Global Insight, a forecasting firm.

Lower Manhattan, which includes Wall Street, was among the hardest-hit areas after the storm sent a nearly 14-foot surge of seawater, a record, coursing over its seawalls and highways.

Water cascaded into the gaping, unfinished construction pit at the World Trade Center, and the New York Stock Exchange was closed for a second day, the first time that has happened because of weather since the Blizzard of 1888. The NYSE said it will reopen on Wednesday.

A huge fire destroyed as many as 100 houses in a flooded beachfront neighborhood in Queens on Tuesday, forcing firefighters to undertake daring rescues. Three people were injured.

New York University's Tisch Hospital evacuated 200 patients after its backup generator failed. About 20 babies from the neonatal intensive care unit were carried down staircases and were given battery-powered respirators.

A construction crane that collapsed in the high winds on Monday still dangled precariously 74 floors above the streets of midtown Manhattan, and hundreds of people were evacuated as a precaution. And on Staten Island, a tanker ship wound up beached on the shore.

Most major tunnels and bridges in New York were closed, as were schools, Broadway theaters and the metropolitan area's three main airports, LaGuardia, Kennedy and Newark.

With water standing in two major commuter tunnels and seven subway tunnels under the East River, Mayor Michael Bloomberg said it was unclear when the nation's largest transit system would be rolling again. It shut down Sunday night ahead of the storm.

Joseph Lhota, chairman of the Metropolitan Transportation Authority, said the damage was the worst in the 108-year history of the New York subway.

Similarly, Consolidated Edison said it could take at least a week to restore electricity to the last of the nearly 800,000 customers in and around New York City who lost power.

Millions of more fortunate New Yorkers surveyed the damage as dawn broke, their city brought to an extraordinary standstill.

"Oh, Jesus. Oh, no," Faye Schwartz said she looked over her neighborhood in Brooklyn, where cars were scattered like leaves.

Reggie Thomas, a maintenance supervisor at a prison near the overflowing Hudson River, emerged from an overnight shift, a toothbrush in his front pocket, to find his Honda with its windows down and a foot of water inside. The windows automatically go down when the car is submerged to free drivers.

"It's totaled," Thomas said with a shrug. "You would have needed a boat last night."

Around midday, Sandy was about 120 miles east of Pittsburgh, pushing westward with winds of 45 mph, and was expected to make a turn into New York State on Tuesday night. Although weakening as it goes, the storm will continue to bring heavy rain and flooding, said Daniel Brown of the National Hurricane Center in Miami.

In a measure of the storm's immense size and power, waves on southern Lake Michigan rose to a record-tying 20.3 feet. High winds spinning off Sandy's edges clobbered the Cleveland area early Tuesday, uprooting trees, cutting power to hundreds of thousands, closing schools and flooding major roads along Lake Erie.

In Portland, Maine, gusts topping 60 mph scared away several cruise ships and prompted officials to close the port.

Sandy also brought blizzard conditions to parts of West Virginia and neighboring Appalachian states, with more than 2 feet of snow expected in some places. A snowstorm in western Maryland caused a pileup of tractor-trailers that blocked part of Interstate 68 on slippery Big Savage Mountain.

"It's like a long-tailed cat in a room full of rocking chairs up here," said Bill Wiltson, a Maryland State Police dispatcher.

The death toll climbed rapidly, and included 17 victims in New York State — 10 of them in New York City — along with five dead in Pennsylvania and four in New Jersey. Sandy also killed 69 people in the Caribbean before making its way up the Eastern Seaboard.

In New Jersey, Sandy cut off barrier islands, swept houses from their foundations and washed amusement pier rides into the ocean. It also wrecked several boardwalks up and down the coast, tearing away a section of Atlantic City's world-famous promenade. Atlantic City's 12 waterfront casinos came through largely unscathed.

Jersey City was closed to cars because traffic lights were out, and Hoboken, just over the Hudson River from Manhattan, was hit with major flooding.

A huge swell of water swept over the small New Jersey town of Moonachie, near the Hackensack River, and authorities struggled to rescue about 800 people, some living in a trailer park. And in neighboring Little Ferry, water suddenly started gushing out of storm drains overnight, submerging a road under 4 feet of water and swamping houses.

Police and fire officials used boats and trucks to reach the stranded.

"I looked out and the next thing you know, the water just came up through the grates. It came up so quickly you couldn't do anything about it. If you wanted to move your car to higher ground you didn't have enough time," said Little Ferry resident Leo Quigley, who with his wife was taken to higher ground by boat.

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Hays reported from New York and Breed reported from Raleigh, N.C.; AP Science Writer Seth Borenstein contributed to this report from Washington. Associated Press writers David Dishneau in Delaware City, Del., Katie Zezima in Atlantic City, Emery P. Dalesio in Elizabeth City, N.C., and Erika Niedowski in Cranston, R.I., also contributed.