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Judge approves settlement in 'state secrets' case

By Terry Frieden, CNN Justice Producer
Attorney General Eric Holder says he plans to make changes in the state-secrets policy.
Attorney General Eric Holder says he plans to make changes in the state-secrets policy.
  • Judge chastises government but approves $3 million settlement in "state secrets" case
  • Former DEA agent claims his home was illegally wiretapped by CIA
  • State-secrets defense is often cited to protect national security

Washington (CNN) -- A federal judge in Washington Tuesday sharply criticized the government but grudgingly approved a $3 million government payout in a case which the Obama administration managed to keep under wraps to protect national secrets.

U.S. District Court Judge Royce Lamberth scolded the government for invoking the "state secrets" defense in a long-running dispute in which a former DEA agent alleged his home in Burma was illegally wiretapped by a CIA agent. The DEA was at odds with the CIA over how to deal with Burmese drug trafficking.

Under the state-secrets policy, courts can be restricted in cases in which government secrets could be released.

Ending a 15-year legal fight, the government agreed to pay DEA agent Richard Horn $3 million, but the government did not admit wrongdoing.

Lamberth was annoyed.

"Now this Court is called upon to approve a $3 million payment to an individual plaintiff by the United States, and again it does not appear any government officials have been held accountable for this loss to the taxpayer. This is troubling to the Court," Lamberth said in his opinion.

He cited an earlier case in which a judge in the same courthouse last year agreed to approve a settlement paying $6 million to a man who had been improperly identified as a suspect in the 2001 anthrax mailings.

Lamberth complained that nobody was held accountable for the taxpayer loss.

"It is not without some misgiving that the Court reaches this decision," the judge wrote.

The judge's opinion also noted that there was misconduct in the case in the offices of both the inspectors general at the State Department and CIA, but said those matters remain secret.

Lamberth urged Attorney General Eric Holder to refer those findings for further internal administration investigation, and to inform congressional committees. The judge also said he applauds planned changes in state-secrets policy announced by Holder last September.

The new standard would require the attorney general and a panel of government lawyers to approve use of a state-secrets defense "only when genuine and significant harm to national defense or foreign relations is at stake."