NEW YORK, June 28 (Reuters) - Outspoken New York criminal defense attorney Lynne Stewart, now disbarred and incarcerated, on Thursday lost a bid to reverse her 10-year prison sentence for helping a suspected Islamist militant smuggle messages to his followers from prison.

In a written opinion, three judges at the 2nd U.S. Circuit Court of Appeals expressed little sympathy for 72-year-old Stewart, whose supporters had argued the prison term amounted to a death sentence.

Stewart "has persisted in exhibiting what seems to be a stark inability to understand the seriousness of her crimes, the breadth and depth of the danger in which they placed the lives and safety of unknown innocents, and the extent to which they constituted an abuse of her trust and privilege as a member of the bar," the 51-page opinion said.

Stewart, a longtime human rights lawyer, was convicted by a Manhattan federal jury in July 2005 of helping her client, blind Egyptian cleric Sheikh Omar Abdel-Rahman, contact the Islamic Group in Egypt. This was a violation of the Special Administrative Measures governing Abdel-Rahman's confinement. Stewart was sentenced to 28 months in prison.

The Islamic Group is listed by the U.S. government as a terrorist organization.

After her October 2006 sentencing, Stewart, standing on the courthouse steps, said that she could serve the 28-month sentence "standing on my head." The government also seized on remarks she made in a television interview and at a press conference.

"I'd like to think I would not do anything differently," Stewart told host of "Democracy Now!" Amy Goodman on Nov. 17, 2009. "I had no criminal intent whatsoever. This was a considered decision based on the need of the client."

She later said she regretted what she had said and that her comments had been misunderstood.

INCREASED SENTENCE

In 2009, after a government appeal, a 2nd Circuit panel sent the case back to U.S. District Judge John Koeltl for resentencing on the grounds that the initial sentence was insufficient. Koeltl in July 2010 increased Stewart's sentence to 10 years, four times what he had originally imposed.

The same panel of judges -- John Walker, Guido Calabresi and Robert Sack -- issued Thursday's opinion.

Herald Price Fahringer, an attorney for Stewart, said he would ask for the case to be reheard before the full appeals court and that the issues it presents may warrant review by the Supreme Court.

The opinion is a "terrible deterrent for people speaking out in public," he said.

Fahringer had argued that comments Stewart made after her initial sentence was imposed should not have been used to increase her prison term or been taken as a clear-cut denial of remorse for her actions.

"Cobbling together scraps of First Amendment doctrine and dicta for support, she (Stewart) contends that she was punished for what she said, and that such punishment runs afoul of the First Amendment," the opinion, written by Sack, said.

The appeals judges praised Koeltl's reasoning in quadrupling Stewart's sentence.

By taking Stewart's statements into account, Koeltl was "determining the characteristics of the defendant, which were legally relevant to a determination of the appropriate sentence to impose on Stewart, through the contents of statements she voluntarily and publicly made."

NO 'CHILLING EFFECT'

The opinion brushed aside any notion that her sentence would have a "chilling effect" on free speech and said the government can, in some circumstances, use what a person says in public against them.

Nevertheless, the opinion said it was important to "again emphasize" that courts cannot use any protected speech in fashioning a sentence. The speech must, for example, be related to "specific criminal wrongdoing."

The 2nd Circuit also said Koeltl had not punished Stewart for her political beliefs and that he had "punctiliously" followed its instructions in refashioning a sentence.

Abdel-Rahman was convicted in 1995 of conspiring to attack the United Nations and other New York City landmarks, following the 1993 World Trade Center truck bombing.

Stewart is serving her sentence at the Federal Medical Center prison in Fort Worth, Texas.

The case is US v. Lynne Stewart et al, U.S. Court of Appeals for the 2nd Circuit, No. 10-3185.

For Stewart: Herald Price Fahringer of Fahringer & Dubno and Jill Shellow of the Law Offices of Jill Shellow.

For the government: Andrew Seth Dember, Assistant U.S. Attorney for the Southern District of New York.

(Reporting By Basil Katz)

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