— Durham County prosecutors will retry Durham novelist Mike Peterson in the 2001 death of his wife, sources told WRAL News Tuesday.

The decision comes less that 12 hours after the state Court of Appeals issued a unanimous decision upholding a lower court's ruling that Peterson should get a new trial.

After almost a decade in prison, Peterson was granted a new trial in December 2011 when Superior Court Judge Orlando Hudson ruled that a key prosecution witness gave false and misleading testimony during Peterson's 2003 murder trial, depriving him of his right to a fair trial.

The one-time Durham mayoral candidate was released from jail and has been under house arrest since then awaiting that opportunity.

Durham County District Attorney Leon Stanback said Tuesday he was discussing with the Attorney General's Office how to proceed with the case. Options included a new trial, dismissing the case or reaching a plea agreement.

Because the Court of Appeals ruling was unanimous, it's unclear whether the state Supreme Court would consider further appeals by prosecutors. Any request for Supreme Court review must be made by Aug. 20.

"I was disappointed, but it was not totally unexpected," Stanback said of the ruling.

Kathleen Peterson was found dead in a pool of blood at the bottom of a staircase in the Petersons' upscale Durham home on Dec. 9, 2001. Prosecutors were never able to establish a clear motive and didn't find a murder weapon, and Mike Peterson has long denied any involvement in her death.

Hudson ruled that former State Bureau of Investigation blood analyst Duane Deaver misled jurors about his expertise and used questionable tests on evidence found in the Peterson home.

Deaver was fired by the SBI two years ago amid an independent review of suspect practices at the state crime lab.

The Attorney General's Office had argued that Hudson was wrong to throw out Peterson's conviction, saying other evidence presented during the 2003 would have been enough for jurors to find him guilty of murder.

The appeals court judges said, however, that the violations of Peterson's rights by Deaver's false testimony outweighed the state's argument.

"What is undeniable is that expert witness testimony played a determinative role in the outcome of defendant’s original trial," Judge Robert C. Hunter wrote in Tuesday's ruling.

Stanback said Deaver was "just one of the witnesses on the blood evidence," noting that other witnesses "sort of agreed" with the conclusions he presented at Peterson's trial.

Mike Peterson's appellate attorney, Jim Cooney, said trials have to be fair to both prosecutors and defendants, and Deaver's exaggerations prevented that.

"You don't get a fair trial when law enforcement lies on the stand. Because of Agent Duane Deaver, Mike Peterson did not get a fair trial," Cooney said.

Peterson was obviously pleased with the ruling, said Durham lawyer Kerry Sutton, a longtime friend.

"He's relieved to have made this huge progress, and it's a little bit of validation," Sutton said.