I do think the girl should be punished, but I don't know if throwing her in juvey is the answer. I seriously don't think a 12 year old understands the full implications of what happened. Plus, honestly it sounds like she needs therapy- not juvey. I know kids who need to go to juvey and honestly she isn't even in the ballpark.
He needs to be reinstated in his original position.
However- teachers (ALL adults) need to be careful. I work in a classroom and I work as a coach/league president. You don't touch the kids, period. We live in a sue happy culture and it's just not worth it. It sucks, but it's reality.
This happened to one of our teachers when I was in high school. The girl admitted later on that she was mad that the teacher didn't give her a good grade.
She clearly had some issues. Ruined his teaching career. He never could defend himself - told to pack up his stuff and resign before he was fired.
12 year old girl accuses teacher of molesting her. No basis in fact. Teacher now cannot get a solid job in the county and has had to move his family, etc...
I think this girl should go to juvenile jail for at least a year.