* Judge sets May trial date, hopes to finish by end-year
* Case may offer clues to trials of Guantanamo inmates
* Accused of being colleague of Sept. 11 mastermind
By Andy Kravetz
PEORIA, Ill., March 23 (Reuters) - An accused sleeper agent for al Qaeda who was held in isolation in a U.S. Navy brig for six years pleaded not guilty to terrorism charges in an appearance in federal court on Monday.
Ali al-Marri, a 43-year-old with dual citizenship in Qatar and Saudi Arabia, was originally arrested in Peoria in December 2001 in an investigation of the Sept. 11 hijacked plane attacks, and in 2003 was branded an "enemy combatant" and kept in isolation in a military prison.
Marri arrived in the United States on Sept. 10, 2001, on a student visa, and had earlier been a student at Bradley University in Peoria. Prosecutors have said he attended no classes in 2001, a violation of his visa.
U.S. District Judge Michael Mihm set a trial date of May 26 but added that, realistically, he wanted to "try this case by the end of the year."
After reading Marri the charges against him of conspiring with al Qaeda and providing material support for terrorism, Mihm asked Marri about his general health and his age.
To the latter question, the stocky Marri answered "43, I think." There was a brief delay in the hearing, attended by some 70 people, because Marri did not have his reading glasses, which were retrieved by a court officer.
When he was arrested in 2001, Marri was charged initially with credit card fraud and lying to the FBI, and pleaded not guilty. The charges were dropped in 2003 when then-President George W. Bush declared him an "enemy combatant" and sent him to the Consolidated Naval Brig in South Carolina. He was held in the military prison without charge and in extreme isolation for nearly six years.
MODEL FOR GUANTANAMO CASES?
Following a review ordered by President Barack Obama, Marri’s case was transferred to the U.S. court system. A federal grand jury in Illinois indicted Marri last month. He made two court appearances in Charleston, South Carolina, and was denied bail before being transferred to Illinois.
Some legal experts have said Marri’s case may offer a preview of how the administration plans to deal with roughly 245 inmates of the prison in Guantanamo Bay, Cuba, if it is closed as planned.
Earlier this month, the Obama administration stopped calling Guantanamo inmates "enemy combatants" and incorporated international law as its basis for holding them.
Justice Department prosecutors have not detailed the basis for the charges against Marri other than to say he was a colleague of suspected Sept. 11 mastermind Khalid Sheikh Mohammed, that he was in the United States at al Qaeda’s request, and that while here he contacted members of al Qaeda in Afghanistan.
Judge Mihm ordered prosecutors to hand over some evidence to the defense team, including a copy of Marri’s computer hard drive that authorities allege contained information about toxins, the locations of dams, and topics related to al Qaeda and terrorism.
An FBI agent involved in the case previously said Marri’s laptop also contained items that could be used by hackers to damage or collect information from protected computer systems, as well as stolen credit card numbers and driver’s licenses.
Some of the evidence Mihm ordered transferred to the defense is classified. (Writing by Andrew Stern; Editing by Michael Conlon and Eric Walsh)