Let me just lay out what I believe is happening here.
6 seconds sound clip from the Donnie Darko movie soundboard.
You can hear this line at 01:02:52 in the Blu-ray version of the movie.
Quote context
[...]
- Thank you for seeing us at such late notice.
- We both felt that it was time for us to come in and discuss...
- What I think is going on with your son?
- Yes.
- I'm not really sure that's a good example. I think he had just cause to insult her.
- Let me just lay out what I believe is happening here.
- Has he ever told you about his friend Frank?
- Frank?
- Yes, the giant bunny rabbit.
- I don't recall him ever having mentioned a rabbit.
- Donnie is experiencing what is commonly called a daylight hallucination.
- This is a common occurrence among paranoid schizophrenics.
[...]