Prosecutors dropped the charges against former Alabama governor Siegelman and a former chief of staff Paul Hamrick Tuesday.
The government made the decision after a judge threw out a conspiracy charge that was the linch pin of the case.
U.S. District Judge U.W. Clemon ruled there was insufficient evidence to support the conspiracy charge against Siegelman and Hamrick. That left only a healthcare fraud charge against the two.
At that point, Assistant Attorney Matt Hart moved to dismiss the case, saying, "There is no point in going forward.''
Clemon dismissed the charges with prejudice, which prevents the government from bringing them again.
Siegelman had tears in his eyes and immediately hugged his wife, Lori, who was seated in the front row.