The family of Denice Fox, a retired teacher who was beheaded by a neighbor's son in Glen Cove in 2006, has asked a judge to approve a $500,000 civil settlement with the killer's former therapist to end a wrongful death claim, court records show.

Evan Marshall, now 40, pleaded guilty in 2007 to murdering Fox and is serving a prison term of 30 years to life. Police found the 57-year-old victim's head in the trunk of Marshall's car and the rest of her dismembered body in two garbage cans in his mother's basement -- where they also recovered violent pornography and mannequin parts.

Last year, state Supreme Court Justice F. Dana Winslow dismissed several defendants from a lawsuit brought by Fox's widower, Jay, and the couple's two adult children. But the judge said the Foxes could continue a claim against an upstate Brewster facility that was run by SLS Residential Inc. where Marshall had been living, and psychologist David P. Gureasko-Moore -- who treated Marshall there.

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In a March 16 court filing, a lawyer for the plaintiffs said mediation with Moore led to an offer from his insurance company to resolve the wrongful death claim for $500,000.

Plaintiffs' attorney John Craig of Manhattan wrote in part that the amount "is more than fair," because the facility "is no longer conducting any business" and any judgment against it or the incarcerated killer "would likely be worthless."

In an affidavit, Jay Fox, 67, also wrote that the settlement would have the benefit "of sparing me and my family the emotional trauma that would necessarily accompany any trial of this matter." That filing also said the settlement with Moore called for the plaintiffs to drop claims against the treatment facility.

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The 2008 lawsuit alleged Marshall was out on a weekend pass from the mental health and drug treatment program when, on Aug. 17, 2006, he killed Fox. It also said police later found more sadomasochistic porn and a note among Marshall's belongings at the facility in which he talked about killing a girl and doing "cocaine off her corpse."

Fox's family had claimed Marshall shouldn't have been allowed to leave the facility because he was a danger to the public. The suit also said that while Marshall's admission to the program was voluntary, the defendants should have sought his involuntary commitment.

Lawyers for the plaintiffs and Moore didn't return messages Tuesday afternoon. Robert Weis, an attorney in upstate Carmel who represented SLS Residential, said he understood there was a confidential settlement worked out and papers were submitted for the court's approval, but he couldn't comment on it.

The case is scheduled back into a Mineola court on Tuesday, when Winslow will address the proposed settlement and a request from the plaintiff's law firm to seal terms of the agreement.