The revelation came on Wednesday as the US government decided whether to battle on in the high-profile trial, appeal against the dramatic ruling, or submit a motion for Judge Leonie Brinkema to reconsider her move.
"We don't know whether it is worth us proceeding at all, candidly, under the ruling you made today," Robert Spencer told Brinkema in a telephone call late on Tuesday and made available later in transcripts released by the court.
Spencer's comments will bolster the view of many legal experts that the case has been fatally damaged, and the US Justice Department may simply decide to fold its hand entirely.
Judge Leonie Brinkema had on Tuesday removed aviation evidence vital to the prosecution case.
The judge had also denied a defence request for the death penalty to be removed from the case.
A furious Judge Brinkema delivered the blow to prosecutors after the trial in Alexandria, Virginia, was pitched into turmoil by a row over coaching witnesses by a government lawyer.
"I don't think in the annals of criminal law there has ever been a case with as many significant problems," Brinkema said.
Trial prosecutors had wanted the
death penalty for Moussaoui
She said all parts of the evidence relating to aviation security were "irredeemably contaminated" and struck them out.
That move is likely to prevent prosecutors from arguing that authorities could have introduced new airport security measures to prevent the attacks, if Moussaoui had told the truth about the September 11 attacks.
The prosecution had argued in a tense courtroom battle that such evidence made up half of its case against Moussaoui.
The drama erupted after lawyer Carla Martin of the Transportation Security Administration apparently coached witnesses, in a move which the defence said prejudiced Moussaoui's chances of a fair trial.
The episode threatens to prevent what is likely to be the US government's only chance to secure a death penalty in connection with the 2001 airplane strikes on New York and Washington which killed nearly 3000 people.
The trial of Moussaoui is taking
place in Alexandria, Virginia
Defence lawyers claimed Martin's actions meant that Moussaoui, a French citizen of Moroccan descent, could never have a fair trial.
Moussaoui watched the proceedings in silence but as he was led from court for a lunchbreak, he shouted: "God Curse America, nation of shit."
The 37-year-old pleaded guilty in April to conspiring with al-Qaida to hijack aircraft and commit other crimes, and the current trial will determine his punishment: life in prison, or death.
Moussaoui has specifically denied any links to 9/11 and says he was training to be part of a possible future attack.
Prosecutors, to obtain the death penalty, must prove that Moussaoui's actions resulted in at least one death on September 11.