A former Guantanamo Bay (search) translator arrested with classified documents in his luggage pleaded not guilty Thursday in a brief appearance in federal court.

Ahmed Fathy Mehalba (search), who has been in federal custody since his arrest Sept. 29 at Logan International Airport, was charged in a Nov. 12 indictment with gathering, transmitting or losing defense information and making false statements.

Mehalba, 31, was arrested as he arrived at Logan after visiting his native Egypt (search). The government alleges he lied to federal investigators when he told them he was not carrying any government documents from Guantanamo Bay. Customs agents found 132 compact discs in his luggage, including one that contained hundreds of classified documents labeled "SECRET," authorities said.

He is also charged with lying about not understanding the meaning of the term "secret" with regards to the classified documents, and about not receiving a security briefing.

More than 650 prisoners have been held essentially incommunicado at the Guantanamo Bay naval base following the Sept. 11, 2001, terrorist attacks.

The Supreme Court agreed earlier this month to hear an appeal asking whether foreigners held there may contest their captivity in American courts. The Bush administration maintains that because the men were picked up overseas on suspicion of terrorism and are being held on foreign land, they may be detained indefinitely without charges or trial.

Mehalba's arrest was the third involving someone who worked closely with Guantanamo's prison population. Two military personnel are also in custody.

Mehalba, who is being held without bail, faces a maximum sentence of 10 years in prison and a $250,000 fine on the gathering defense information charge, and a sentence of up to five years in prison and a $250,000 fine on each of two false statements charges.

Michael Andrews, Mehalba's attorney, said a plea deal with the government was possible in the case, as with any case.

"We haven't made any decisions," he said.

Federal Magistrate Judge Charles Swartwood set a Jan. 5 conference in the case, and said Mehalba does not need to appear at that hearing.