Prince Jackson -- Conrad Murray Told Us, 'Sorry Kids. Dad's Dead.'

Prince Jackson just testified ... Dr. Conrad Murray informed them of Michael Jackson's passing by glibly announcing, "Sorry kids. Dad's dead."

Prince has taken the stand in the Jackson family's wrongful death lawsuit against AEG, saying all he and his siblings could do was cry after hearing the news.

Prince said he recalled being in the sitting room of the Holmby Hills mansion when his father went into cardiac arrest on June 25th, 2009. Prince said he heard screams and Murray summoned him upstairs, where Prince saw his father "half hanging out of the bed" while Murray administered CPR.

He said Paris was hit the hardest by her dad's death, screaming that she "wanted her daddy" while Murray was trying to resuscitate him.

Prince said, "She was my dad's princess. She definitely is dealing with [his death] in her own way."

As we reported, Paris has sunken into a deep and dangerous depression recently, stemming from her father and his death.