SIOUX FALLS, S.D. - Leonard Peltier has agreed to dismiss a libel lawsuit over accusations that he was involved in the 1975 killing of fellow American Indian Movement member Anna Mae Pictou Aquash, according to a court document.

The May 2003 case, filed in U.S. District Court in Minneapolis, named as a defendant Paul DeMain, editor of News From Indian Country, a newspaper based in Wisconsin.

Aquash's frozen body was found in February 1976 on South Dakota's Pine Ridge Indian Reservation. The 30-year-old woman from Canada had been shot in the head in December 1975 after being taken from Denver.

Arlo Looking Cloud and John Graham were charged in March 2003 with first-degree murder committed in the perpetration of a kidnapping.

Looking Cloud was convicted in February, sentenced to life in prison in April and transferred to a federal prison at Florence, Colo., on Friday.

Graham was arrested in Vancouver, British Columbia. He is free on bond and plans to fight extradition to South Dakota.

Peltier's lawsuit quoted from an editor's note published in March 2003 in which DeMain said, "The primary motive for the murder of Annie Mae Pictou Aquash by other members of the American Indian Movement in mid-December 1975 allegedly was her knowledge that Leonard Peltier had shot the two agents as he was convicted."

The lawsuit also challenged DeMain's statement that Peltier was actually convicted. "The government has admitted that it cannot prove that Mr. Peltier shot the two agents," it stated.

Peltier is serving two back-to-back life sentences in Leavenworth, Kan., for the June 1975 killing of FBI agents Ron Williams and Jack Coler on the Pine Ridge reservation. Both were shot in the head at point-blank range after they were injured in a shootout.

Peltier was convicted in 1977 of two counts of first-degree murder and courts have rejected his appeals.

DeMain would not comment Monday on the dismissal but referred to a May 28 news release in which he said he did not agree to retract the statements he made about Peltier. He wrote "the lawsuit was frivolous and without merit" and was intended to limit free speech and the search for truth in the Aquash case.

But in a letter submitted to the court and included in DeMain's release, he acknowledged that the environment on the Pine Ridge reservation was like "a war zone" in the 1970s and the justice system has treated Indians unfairly.

DeMain also wrote that he does not believe Peltier received a fair trial nor did he have anything to do with Aquash's murder.

In a news release, Peltier lawyer Barry Bachrach said DeMain's statement was the only issue in the settlement and money was not a part of it.

Before President Clinton left office in January 2001, he considered granting Peltier clemency but decided against it.

Among the people who urged Clinton to keep Peltier behind bars: then-FBI Director Louis Freeh, U.S. Sen. Tom Daschle and former Gov. Bill Janklow, who said he flew to Washington and had a long meeting with Clinton at the White House over it.