A three-judge Iraqi panel ruled there was insufficient evidence against Abdul Ameer Younis Hussein, who was filming the bombing aftermath in the northern city of Mosul when he was apprehended.
Hussein remains in custody, according to CBS News senior vice president Linda Mason, who says he has been taken back to the prison at Abu Ghraib while his attorney, Scott Horton, petitions the court for his immediate release.
Hussein, 25, was returned to Abu Ghraib prison pending final U.S. military approval of his release. A U.S. spokesman Lt. Col. Kevin Curry said he expected Hussein to be released by Thursday.
"I am so happy," said Hussein's brother, Mohammed Younis Hussein, who traveled from Mosul for the trial. "I have cried a lot these months, but now I feel I can rest. It's incredible."
CBS Baghdad bureau chief Larry Doyle said he received an e-mail from the U.S. task force at Abu Ghraib saying Hussein "appeared to be instigating a crowd" in Mosul.
At the time of Hussein's arrest, CBS News reported that the U.S. military said the videotape in the journalist's camera led them to suspect he had prior knowledge of attacks on American troops, Doyle said. But more details from the military have been hard to come by, the bureau chief said.
The defendant, who wore a yellow jumpsuit, was not permitted to speak to reporters. Between appearances on the witness stand, he had to kneel on the floor in the back of the courtroom, facing a wall — highly unusual in an Iraqi court.
A half dozen American soldiers in full body armor stood nearby, guarding him and other Iraqi defendants in other cases, who also faced the wall.
The U.S. military "fully supports and stands by each of the court's decisions," said Curry, who highlighted the autonomy of Iraqi courts. He also pointed out, however, that the evidence had been deemed sufficient by the investigative judge who recommended the case be tried.
"Justice was served in the proceedings today," said Scott Horton, an American lawyer who flew in from New York to counsel Hussein and assist his Iraqi lawyers.
Horton said the U.S. military claimed Hussein had prior knowledge of the car bombing and celebrated with other Iraqis in the aftermath, chanting "God is great!"
But prosecutors acknowledged that there was not enough evidence and moved to drop the case.
In testimony to the panel, Hussein said he was filming a celebration at a university in Mosul in April 2005 when he heard a car bomb explode. He said he called a colleague at a French news agency to find out more about the location, then raced to the site in a taxi.
He encountered American troops surrounding the area and waited until they cleared to go in and film, he said. After getting some footage, he said he heard people start yelling there were snipers in the area and he felt a shot.