FBI, WALSENBURG JUDGE REACH SUIT SETTLEMENT

Judge Claude Appel says FBI will pay him $100,000 to settle his
lawsuit.

DENVER - Judge Claude Appel of Walsenburg said Monday the FBI will pay
him $100,000 to settle his lawsuit that accused the FBI of damaging
his reputation by releasing defamatory information about him.

The FBI in 2001 privately released a confidential report of its secret
investigation of Appel, who was suspected of using drugs. The
investigation began in 1994.

"The FBI closed its case in 1997 and concluded that there was no
evidence of judicial misconduct or substantiated evidence of drug use
by Judge Appel," U.S. Attorney John Suthers said Monday in a prepared
statement.

Although Suthers announced a settlement was reached, his spokesman
would not confirm nor deny that the FBI will pay Appel $100,000. The
U.S. Attorney's staff represented the FBI in its defense against the
lawsuit.

"The rumors and innuendo that I have used illegal drugs were and are
absolutely false," Appel said in a written statement.

Speaking from the Huerfano County Courthouse, Appel told The Pueblo
Chieftain that he will seek retention in office in the November 2006
election. "I love being a judge," he said.

He blamed "office politics of the 3rd Judicial District" for the FBI
beginning its investigation. He would not identify anyone
specifically, but the FBI said in a recent court filing that former
3rd District Judge Jesse Manzanares of Trinidad provided information
about Appel during the investigation.

Appel has said he and Manzanares "had an acrimonious relationship" for
many years. The judicial district consists of Huerfano and Las Animas
counties.

Huerfano County Judge Robert Haeger, who works in the same courthouse
as Appel, was a secret informant against him.

A trial of Appel's lawsuit had been set to begin May 3. Haeger has a
similar lawsuit scheduled for trial the same day.

"Obviously the past three years have been very difficult for my wife
and me," Appel said. He said she was diagnosed with multiple sclerosis
a month before the FBI, under subpoena, released the confidential
investigative report.

The FBI released the report to the state agency that regulates the
conduct of lawyers as part of the agency's investigation of a Denver
lawyer who had made defamatory allegations against Appel and Haeger.

The lawyer, William Danks, got a copy of the report and disseminated
it to others.

The FBI's investigation of Appel did not become widely known until
last year when he revealed it in his lawsuit.

The chief justice of the Colorado Supreme Court ordered an
investigation of Appel and Haeger after Danks disseminated the report.
In 2002, Chief Justice Mary Mullarkey said she was satisfied that
allegations against the judges "are unfounded rumor and innuendo."

Appel told The Chieftain that "it's very important to me" to thank
teen-agers "who have given me and my wife support" during the turmoil
in their lives. The teen-agers are part of a Teen Court that Appel and
his wife operate to persuade young people "that there are alternatives
to getting involved in crime and drugs."

"I didn't want it (the Teen Court) to be endangered as a result of
these accusations."

A physician was prepared to testify about treatment he prescribed for
Appel relating to the release of the FBI report.

On Dec. 29, the FBI, in a court filing by one of Suthers' assistants,
denied that its investigation "failed to develop any evidence of
criminal or other misconduct by" Appel.

A spokesman for Suthers said on Monday he cannot comment on the
seemingly inconsistent statements then and Monday because the
spokesman was instructed not to comment on the case.

Appel's attorney, Michael Berger of Denver, said, however, he thinks
the apparent inconsistency is due to the FBI's "broad definition of
evidence." Berger said the FBI defines evidence as any statement it
receives "even though it's totally unsubstantiated."