A rare decision by Defense Secretary Robert Gates to reject a Marine Corps recommendation that one of its heroes receive the Medal of Honor for his actions in Iraq has angered fellow Marines who say Sgt. Rafael Peralta, who was based in Hawai'i, sacrificed his life to save theirs.

Peralta's family in California was notified of the decision yesterday by Lt. Gen. Richard Natonski, a top Marine Corps commander.

A Gates-appointed panel unanimously concluded that the report on Peralta's action did not meet the standard of "no margin of doubt or possibility of error," Pentagon spokesman Bryan Whitman said.

The argument about whether to award the nation's highest military honor centers on whether the mortally wounded Peralta could have intentionally reached for a grenade to protect fellow Marines after suffering a serious head wound.

For his actions during a Nov. 15, 2004, firefight in Fallujah, Iraq, Peralta will receive the Navy Cross, the service's second-highest award for valor. The citation said Peralta covered a live grenade thrown by insurgents.

George Sabga, an attorney and retired Marine who has served as a go-between for the family, said Peralta's mother, Rosa, looked like she was going to pass out when Natonski delivered the news in person that the recognition had been downgraded.

Rosa Peralta previously said an undersecretary of the Navy had told her the Medal of Honor had been approved and needed the president's signature.

"I don't want that medal," Rosa Peralta said yesterday, referring to the Navy Cross. "I won't accept it. It doesn't seem fair to me."

The decision is "almost like somebody called me a liar," said Marine Sgt. Nicholas Jones, 25, who was with Peralta on the day of the firefight.

Jones, a recruiter, said Peralta's actions have become part of Marine Corps lore, as drill sergeants and officer-candidate instructors repeat it to new Marines.

"His name is definitely synonymous with valor," said Jones, who was wounded by shrapnel from the grenade blast.

"My honest opinion (of the medal decision)? It's BS," said Robert Reynolds, a corrections officer and former Marine who credits Peralta with saving his life that day in Fallujah.

"I was in that house. I was next to Sgt. Peralta," Reynolds, 31, said. "I saw him with my own eyes reach out and pull that damn grenade in."

Peralta did exactly what other Marines did who have been awarded the Medal of Honor, Reynolds said.

"You know honestly how I think it is (that he didn't receive the Medal of Honor)?" Reynolds asked. "I think it's because he's an immigrant. I think it's because he's from Mexico."

Reynolds said the Corps never once called him to talk about his eyewitness account.

'PRIVILEGED' TO BE IN U.S.

In a Marine Corps investigation of the attack, Natonski said, "I believe beyond a shadow of a doubt" that the gravely wounded Peralta covered the grenade.

Natonski appeared disappointed by the news he brought the family, said David Donald, Rosa Peralta's son-in-law. "He felt like Rafael deserved the Medal of Honor," Donald said.

Peralta, who came to the United States without documentation, enlisted in the Marines the day he got his green card. He had proudly posted the U.S. Constitution in his home in San Diego.

Icela Donald, Peralta's sister, said he felt "privileged to be here. And if he had a chance, he wanted to defend his country. It was pretty much his life, being in the Marines."

The short and stocky Marine nicknamed "Rafa" had deployed to Japan with 1,000 other Marines with the 1st Battalion, 3rd Marine Regiment, but the Kane'ohe Bay unit was rerouted to Iraq and found itself in the thick of fierce house-to-house fighting in Operation Al Fajr, one of the biggest firefights in Iraq.

Shot in the head and chest as he and other Hawai'i Marines cleared a house, Peralta, 25, had the presence of mind to grab the yellow-colored Iraqi grenade that bounced into the room, fellow Marines say.

He was killed instantly by the blast. Reynolds, the Alpha Company Marine who was in the same room that day, figures Peralta saved as many as five Marines.

He was not only a hero, but an immigrant hero who got his citizenship while in uniform, loved what America and the Corps stood for, and proved it with his life, say those who knew him.

VOLUNTEERED TO GO

On Memorial Day 2005, President Bush singled out Peralta for his valor, saying he "understood that America faces dangerous enemies, and he knew the sacrifices required to defeat them."

As a "platoon guide," Peralta didn't have to be there as the Hawai'i Marines slogged through the streets of Fallujah, but he had volunteered to go.

There was widespread acknowledgement that Peralta deserved the Medal of Honor, but in the nearly four years the U.S. military took to make a decision, the process frustrated fellow Marines and the Peralta family.

The Marines say the Navy Cross award — given to only 17 other Marines in the Iraq and Afghanistan conflicts — remains a distinguished honor.

Peralta had been shot in the head before he covered the grenade, said a Marine investigation. The report concluded he was hit by a ricochet that likely came from the gun of another Marine while they were clearing insurgents from a house.

The Navy Cross citation states that "without hesitation and with complete disregard for his own safety, Sgt. Peralta reached out and pulled the grenade to his body."

Gates appointed a five-member panel led by Gen. George Casey, the Army chief of staff, to review reports of the battle. The panel also included a Medal of Honor recipient, a retired military neurosurgeon and two civilian forensic pathologists, Whitman said. He declined to provide their names.

After the panel made its recommendation, Gates made his decision last week, Whitman said. He declined to provide any explanation other than the facts did not meet the standard for a Medal of Honor.

Four men have been awarded the Medal of Honor for service in Iraq, and one — Lt. Michael Murphy, a Pearl Harbor-based SEAL — for service in Afghanistan. All were posthumous.

GUNSHOT WOUND

The Marine Corps assembled extensive material supporting its Medal of Honor request, including witness statements, ballistic and forensic evidence and several medical opinions.

Marine Reserve Lt. Col. Scott Marconda, who investigated the incident in 2004 as a major and judge advocate, said, "there's no way that grenade got under the center of mass of his body without him putting it there. I'm not a cheerleader. It is what it is. And my point is: I believe that he did that."

The Marine investigation also highlighted a key area of controversy: whether the gunshot wound to the back of Peralta's head from a ricochet left him unable to function.

Col. Eric Berg III, an Army pathologist who autopsied Peralta's remains, said in the 2005 report that the head wound would have been "nearly instantly fatal. He could not have executed any meaningful motions."

But four other experts — Peralta's battalion surgeon, and two neurosurgeons and a neurologist who examined the autopsy reports — said Peralta could have knowingly reached for the grenade.

They say the ricochet was traveling at "low velocity" and would not have immediately killed him.

Sabga, the attorney who has acted as a family go-between, said the U.S. military "seems like they are speaking out of both sides of their mouth."

"(The citation says) he cradled the grenade, but they are also saying there's no way he could have done it. Which one is it?" Sabga said.

Sabga said he believes the friendly fire aspect of the firefight affected the outcome. He also said the Peralta family's immigrant status may have been a factor.

"Last year, I got a call from Headquarters Marine Corps," Sabga said. "They were asking me, 'What's the immigration status of Mrs. Peralta and the rest of her family?' I thought it was kind of weird. Why would they be inquiring about that?"

Rafael Peralta became a U.S. citizen while a Marine. Rosa Peralta recently also became a U.S. citizen, Sabga said.

Translating for Rosa Peralta, who speaks only Spanish, Icela Donald yesterday said her mother felt angry and deceived.

"The whole time she thought he was going to get the Medal of Honor," Icela Donald said.

Peralta's sister said she remains proud of what her brother did.

"It doesn't matter that he didn't get the Medal of Honor," she said. "He'll always be my hero. It's just we want that recognition from (the Marine Corps). He deserves it."