The landmark trial was the first to be handled by Serbia's own war crimes chamber, but the judgment was overturned by the supreme court after claims that procedural errors meant the trial had not been handled properly.
After the 87-day siege of Vokovar in eastern Croatia ended with the defeat of the Croatian National Guard, refugees gathered at the hospital hoping they would be taken to safety by neutral observers.
A deal to this effect had been reached by the Croatian government and the Yugoslav People's Army.
The prisoners were taken from the hospital by Serb paramilitary forces and the army to a nearby pig farm where they were killed and buried in a mass grave.
The incident became known as the Ovcara massacre.
The capture of Vukovar by the Yugoslav army was a pivotal event in Croatia's 1991-1995 war for independence.
More than 1,000 civilians died during the siege and bombardment of the city.
The massacre is specifically mentioned in the indictment against the Slobodan Milosevic, former Yugoslav president.