This is a RUSH transcript from "The O'Reilly Factor," August 3, 2009. This copy may not be in its final form and may be updated.

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BILL O'REILLY, HOST: In the "Personal Story" segment tonight: Police in Covington, Kentucky, have charged 26-year-old Nicole Howell, who teaches English at Dayton High School, with having sex with a student. Ms. Howell says it never happened, that her life is on the verge of being ruined, and she wants to tell her story. So we are going to let her. Joining us from Cincinnati, Ohio, is Nicole Howell and her attorney, Eric Deters.

So, you knew this football player, the 16-year-old. And he was in one of your classes and you texted him? Is that what the initial problem — is that when it began?

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NICOLE HOWELL, TEACHER ACCUSED OF SEXUAL ABUSE: He was actually not a student of mine. He was a junior and my students that I taught were freshman and sophomore. And he actually took my phone while it was unattended and then sent me a text message, and I didn't know who it was.

O'REILLY: Now was it a lurid text message? Offensive in any way?

HOWELL: No, it just said, "Hi, how are you?" And I said, "Who is this?" And he said, "You have to guess." And I said well, I'm not going to. I'm in the middle of grading papers. And then he said well, you know, obviously he said his name. And I was like oh, OK, well, how are you? How is it going? But every text message that was between him and I was platonic.

O'REILLY: And how many text messages were there?

HOWELL: I would say maybe a handful. Nothing like serious conversations going back and forth. Just a hi, how are you? You know, are you staying out of trouble? You know, and that sort of thing.

O'REILLY: OK. Now do you text other students as well? Is that something that happens?

HOWELL: Yeah. In fact, I found that it was very good way to communicate with the students, bring myself down to their level so that, you know, I'm not that I was trying to befriend them in any way because I know that I was still, you know, their teacher, but it was very hard to connect with some of those students. And I found that sending them a text message or them being able to send one to me was a good way to be able to break the ice and let them feel safe to talk.

O'REILLY: All right. When did you learn, Ms. Howell, that there was an allegation against you of a sexual nature? When did you learn that?

HOWELL: I learned that on December 15, when my principal came to my classroom and walked me out of the building and I was suspended right there.

O'REILLY: Did you know what the accusation was and who it came from?

HOWELL: My superintendent had met with me and said that, you know, the student had come forward and said that the allegations, you know, he had made the allegations that it was, in fact, true that I had had sex with him. And that's when they said they need to turn the matter over to the police.

ERIC DETERS, ATTORNEY FOR NICOLE HOWELL: Bill, he made the allegation and then he denied the allegation. When he found out he was going to get expelled, he remade the allegation. So he retracted it.

O'REILLY: All right. Now, anybody can make an allegation against anybody. I mean, you usually don't get an indictment unless there's backup evidence, counselor. What was the backup evidence?

DETERS: The backup evidence was merely — and we haven't gotten the grand jury tapes yet — but the backup evidence was this boy's word, who had made the statement, retracted it and remade it. That is only evidence that they have against this young lady.

O'REILLY: It seems like a grand jury — why wouldn't they just indict it off that?

DETERS: Well, an indictment, as you know, Bill, for grand jury is a prosecutors there, there's no defense attorney.

O'REILLY: No, I understand that, but usually grand juries require more than that. All right, so it's in play. You're arrested. You're charged. The prosecutor says we're going forward. A judge then says you try to get it thrown out, as any good attorney would, Mr. Deters. But the judge says no, we're going to go ahead. And that just gives me pause. If it's just one kid saying this and there's no backup at all, this opens up a huge lawsuit potential for Ms. Howell if this thing falls apart.

DETERS: Absolutely. And this is very important. The allegations were that she gave alcohol, bought alcohol. Never happened. The allegation is he was in her house or apartment, had sex four times. Never happened. The allegation is that she did all of these things, phone calls. The phone records prove that they never had any phone contact.

O'REILLY: Yeah, it's just very, very strange, because if what you're saying is true, both of you, I mean, Nicole, I know your life must just be hell right now, you know, in that community and all of that.

HOWELL: Yeah.

O'REILLY: Everybody watching knows what you're going through. And if you are innocent of this, and you're found, I mean, you could come back for all kinds of things. I would think that the prosecution would cover itself. I'll give you the last word, Ms. Howell. I'm sorry you have to go through this. I hope it's not true. Say what you want.

HOWELL: I just want everyone to know that the reason I'm coming out finally and saying something is because I have an attorney who has given me the free reign to defend myself, as I should have from the very beginning. Unfortunately, I wasn't able to do that until now. But I definitely want people to know that I'm completely innocent of this and they will see the truth.

DETERS: Bill, they gave her — she offered to take a lie detector test and they refused it.

O'REILLY: OK, keep us posted, Mr. Deters, on this and we will keep the audience across America.

DETERS: Thank you.

O'REILLY: And remember you are in this country innocent until proved guilty.

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