Watch CBSN Live

U.S. To Settle Scientist Anthrax Suit

When anthrax-laced letters to Capitol Hill and media offices began killing people just weeks after 9/11, the FBI was under intense pressure to make an arrest. Clues in the case were tantalizing - hand-written letters referencing 9/11, filled with a deadly powdery anthrax, that seemed to be the creation of a well-trained scientist, CBS News justice correspondent Bob Orr reports.

Less than a year after the mailings that killed five people and sickened 17 others, Attorney General John Ashcroft pointed an accusing finger at former Army scientist Steven Hatfill.

But, he was never arrested, never charged. Now the government is forced to pay, Orr reports.

Friday, the Justice Department agreed to pay $5.8 million to settle a lawsuit with Hatfill, who was named as a person of interest in the 2001 anthrax attacks.

Hatfill claimed the Justice Department violated his privacy rights by speaking with reporters about the case.

Settlement documents were filed in federal court Friday. Both sides have agreed to the deal, according to the documents, and as soon as they are signed, the case will be dismissed.

The deal requires the Justice Department to pay $2.825 million dollars up front and buy Hatfill a $3 million annuity that will pay him $150,000 each year for 20 years.

"The United States does not admit to any violation of the Privacy Act and continues to deny all liability in connection with Dr. Hatfill's claims," Justice Department spokesman Brian Roehrkasse said in response to the settlement.

Court documents filed Friday say the two sides have reach an agreement that will lead to the case being dismissed. Hatfill's lawyer did not immediately return a call seeking comment.

Five people were killed and 17 sickened by anthrax that was mailed to lawmakers on Capitol Hill and members of the news media in New York and Florida just weeks after the Sept. 11, 2001, terrorist attacks.

After the attacks, Attorney General John Ashcroft called Hatfill "a person of interest" in the investigation and stories by various reporters followed. Hatfill had worked at the Army's infectious diseases laboratory from 1997 to 1999. The anthrax attacks remain unsolved.

The settlement likely also means that former USA Today reporter Toni Locy will no longer face up to $5,000-a-day in fines in the case. A federal judge ordered her to identify the officials who discussed Hatfill. When she said she couldn't remember, the judge ordered her to identify all her sources on the anthrax case.

She challenged that order, but a federal appeals court has yet to rule in the case. Because Hatfill's lawsuit is being settled, Locy's case will probably be dismissed as moot.

Locy, a former reporter with The Associated Press and other news organizations, now teaches journalism at West Virginia University.