NYT : U.S. to Settle Lawsuit of Man Investigated in Anthrax Case

U.S. to Settle Lawsuit of Man Investigated in Anthrax Case

By SCOTT SHANE and ERIC LICHTBLAU | June 28, 2008

WASHINGTON — The Justice Department announced Friday that it would pay $4.6 million to settle a lawsuit filed by Steven J. Hatfill, a former Army biodefense researcher intensively investigated as a “person of interest” in the deadly anthrax letters of 2001.

The settlement, consisting of $2.825 million in cash and an annuity paying Dr. Hatfill $150,000 a year for 20 years, brings to an end a five-year legal battle that had recently threatened a reporter with large fines for declining to name sources she said she did not recall.

Dr. Hatfill, who worked at the Army’s laboratory at Fort Detrick in Frederick, Md., in the late 1990s, was the subject of a flood of media coverage beginning in mid-2002, after television cameras showed F.B.I. agents in biohazard suits searching his apartment near the Army base. He was later named a “person of interest” in the case by then Attorney General John Ashcroft, speaking on national television.

In a news conference in August 2002, Dr. Hatfill tearfully denied that he had anything to do with the anthrax letters and said irresponsible media coverage based on government leaks had destroyed his reputation.

Dr. Hatfill’s lawsuit, filed in 2003, alleged that F.B.I. agents and Justice Department officials involved in the criminal investigation of the anthrax mailings had leaked information about him to the news media in violation of the Privacy Act. In order to prove their case, his lawyers took depositions from key F.B.I. investigators, senior officials and a number of reporters who had covered the investigation.

Mark Grannis, a lawyer for Dr. Hatfill, said his client was pleased with the settlement.

“This case has been about how the press behaves and how the government behaves,” Mr. Grannis said. “The good news is that we still live in a country where a guy who’s been horribly abused can go to a judge and say ‘I need your help,’ and maybe it takes a while, but he gets justice.”

The settlement, Mr. Grannis said, “means that Steven Hatfill is finally an ex-person of interest.”

The settlement called new attention to the fact that nearly seven years after the toxic letters were mailed, killing five people and sickening at least 17 others, the case has not been solved.

A Justice Department spokesman, Brian Roehrkasse, said in a statement that the government admitted no liability but decided settlement was “in the best interest of the United States.”

“The government remains resolute in its investigation into the anthrax attacks, which killed five individuals and sickened others after lethal anthrax powder was sent through the United States mail,” Mr. Roehrkasse said.

“We commend the agents and law enforcement personnel who have devoted countless hours to the pursuit of the perpetrator of this horrible crime, and we reassure the public and the victims that this investigation remains among the Department’s highest law enforcement priorities,” he said.

But Representative Rush Holt, a New Jersey Democrat whose district was the site of a postal box believed to have been used in the attacks, said he would press Robert S. Mueller III, director of the F.B.I., for more answers about the status of the long-stalled case.

“As today’s settlement announcement confirms, this case was botched from the very beginning,” Mr. Holt said. “The F.B.I. did a poor job of collecting evidence, and then inappropriately focused on one individual as a suspect for too long, developing an erroneous theory of the case that has led to this very expensive dead end.” Dr. Hatfill subpoenaed a number of Washington journalists to try to determine which federal officials had spoken to the news media about the case against him in possible violation of federal privacy laws.

Toni Locy, a former legal affairs reporter for USA Today who wrote several articles about the case, was held in contempt of court, facing fines of up to $5,000 a day from Judge Reggie Walton over her refusal to name her sources, and her case is pending before an appeals court. She said Friday she was relieved by the developments but that it was too soon to celebrate.

“I hope this means that this ordeal is over and that I can get on with my life,” said Ms. Locy, who will begin teaching legal reporting at Washington and Lee University in the fall. She said Dr. Hatfill’s lawyers said they no longer needed her testimony, though she had not been told whether the contempt order against her had been lifted.

The outcome differed significantly from the settlement of a similar case involving Wen Ho Lee, a former nuclear scientist once suspected of espionage. In that case, five news organizations joined the government’s settlement, agreeing to pay a total of $750,000 to prevent their reporters from having to testify about their sources.

Ms. Locy said a federal mediator had tried to get Gannett, which owns USA Today, to negotiate some type of settlement with Dr. Hatfill’s lawyers, but it had refused

She called the result an important affirmation of journalists’ ability to use confidential sources in gathering material on important news stories. “I protected my sources, and that’s important.”

Dr. Hatfill also sued The New York Times and the columnist Nicholas Kristof, alleging that columns Mr. Kristof wrote about the case had libeled him by suggesting that he might be the anthrax mailer. That lawsuit was dismissed last year, but Dr. Hatfill has appealed the dismissal.

The former Army scientist also sued Vanity Fair and the author of an article about the case in the magazine, Donald Foster, as well as Reader’s Digest, which published a condensed version. That case was settled last year on confidential terms.

The anthrax attacks, which began while the nation was still in shock over the Sept. 11 attacks, set off waves of speculation over their source. Early on, investigators investigated whether the origin of the anthrax might have been Iraq, where Saddam Hussein was known to have used poison gas on his own subjects, but no link to Iraq was ever found.

Then, too, the victims of the attacks, and other intended targets who escaped harm, seemed to have nothing in common. While Tom Brokaw of NBC, to whom one letter was addressed, had a name and face recognizable to millions of people, other recipients of anthrax letters, Senators Tom Daschle of South Dakota and Patrick J. Leahy of Vermont, could hardly be described as famous although their names were instantly recognizable in the nation’s capital.

It is known that the letters to the senators, along with one that went to Seymour, Conn., and killed a woman there, were mailed within an hour or so of each other on Oct. 9, 2001, from a post office in Hamilton Township, N.J. It is also known that the Washington-bound letters went through the capital’s huge Brentwood mail facility, killing two workers there. Dr. Hatfill, 54, grew up in Illinois but studied medicine in Rhodesia, now Zimbabwe. After returning to the United States in the early 1990s, he worked at the National Institutes of Health and the U.S. Army Medical Research Institute for Infectious Diseases at Fort Detrick. A Ph.D. degree from a South African University that he used to get hired later turned out to be a forgery.

He did training on bioterrorism for the F.B.I., Central Intelligence Agency and Defense Intelligence Agency and trained to be a bioweapons inspector for the United Nations, though he never began the job.

After Dr. Hatfill came under suspicion in the anthrax case in 2002, an F.B.I. surveillance team began following him everywhere, and a small motorcade sometimes trailed his car around Washington.

In May 2003, an F.B.I. surveillance car ran over Dr. Hatfill’s foot in Georgetown as he approached the car to take the driver’s picture. He was given a ticket for “walking to create a hazard” and paid a $5 fine.

David Stout contributed reporting from Washington.