The U.S. Department of Justice and residents of Libby Montana found themselves on the losing end of the most significant U.S. environmental pollution criminal case filed against a corporate polluter, in the long saga of W.R. Grace and asbestos poisoning in the town of Libby.

Libby residents--of whom 1,200 have died or developed cancer or lung disease related to a vermiculite mine which contained deadly asbestos fibers-got the verdict after a little more than one day of jury deliberation at the end of an 11-week trial in federal court.

The vermiculite was contaminated with tremolite asbestos, which has been linked to mesothelioma, a cancer that can attack the lungs, abdomen or heart.

The defense for the company and Grace executives who had been charged by the Justice Department argued the company had worked for years to clean up the facility. Defendant Jack Wolter, who was among those acquitted Friday, told the news media, There's a lot of people up in Montana, Libby in particular, who certainly had their lives adversely affected by the whole chain of events. But [those problems]...go back, and I am not exaggerating 50, 60 years.

They and their families were exposed at levels that were well over a thousand times higher than what is required by regulation today...and there's no question they suffering immensely, Wolter added. But that's not what the trial was about.

The Justice Department declined to comment on whether the verdict would be appealed. The government had asserted that W.R. Grace conspired to knowingly release the asbestos, and reportedly tried to hide the dangers from employees and residents.

The indictment also claimed Grace tried to impair, impede and frustrate the Environmental Protection Agency and other government agencies when they began an investigation in 1999. The company could have faced criminal fines of up to $280 million while the Grace executives could have faced prison time.

Grace attorneys argued that the company acted responsibly and took appropriate steps to address the problem, voluntarily paying missions of dollars in medical bills for 900 Libby residents.

Although found not guilty of the criminal charges, the company still faces multi-million civil cases in which residents are seeking compensation.

However, a legal expert contacted by the Washington Post, the verdict was a fair reflection of the evidence that jurors were allowed to hear. David Uhlman, former chief of the Justice Department environmental crimes section, said the question that hangs over this case is what would have happened if the government were allowed to present all of the evidence that it had amassed in this multi-year investigation.

In the aftermath of the Ted Stevens dismissal, any errors by prosecutors, particularly when it involves discovery violations, become a big deal, he added.

In a statement, Fred Festa, Grace President and CEO said, We at Grace are gratified by today's verdict and thank the men and women of the jury who were open to hearing the facts. We always believed that Grace and its former executive had acted properly and that a jury would come to the same conclusion when confronted with the evidence.