A French court has cleared Dominique de Villepin, the former prime minister, of plotting a smear campaign against Nicolas Sarkozy, the current president.
The judge said on Thursday that there was no proof that Villepin had acted in bad faith or tried to smear Sarkozy.
Prosecutors had called for an 18-month suspended sentence and a $70,000 fine on Villepin for complicity to slander Sarkozy at a time when both men were running for president.
Thursday's verict in the Paris court will allow Villepin to boost his chances of a political comeback after the five-year legal saga.
In a video posted on a website run by his supporters ahead of the verdict, the 56-year-old said he was awaiting the judgement with "serenity that comes from knowing you have nothing to be ashamed of".
"It has been five years since this affair started and I am happy that it is coming to an end," he said.
Al Jazeera's Estelle Youssouffa, reporting from Paris, said the trial had revealed the bitter rivalry between Villepin and Sarkozy.
"What has been at stake when Villepin has been cleared of charges is the former prime minister's survival, his political survival.
"He is posing himself as a credible alternative to Sarkozy."
Sarkozy made no secret of his enmity towards Villepin when the two served together in the government of Jacques Chirac, the former president.
Villepin, who became prime minister in 2005 after stints as foreign and interior minister, had been accused of using faked documents to link Sarkozy to a corruption probe as the two angled to succeed the ageing Chirac.
Besides Villepin, another co-defendant was also let off, but the three other defendants, including Jean-Louis Gergorin, a former top executive at aerospace group Eads, were all found guilty of conspiracy in the case.
The case centred on a fake list of account holders from the Clearstream financial clearing house, who were said to have received kickbacks from the sale of French warships to Taiwan.
Sarkozy, whose name was on the list, alleges the scandal was fabricated to tarnish him ahead of his party's nomination for the 2007 presidential vote, which he won.
Sarkozy has repeatedly said he would hang those responsible for the scandal "on a butcher's hook".
The president is one of 39 civil plaintiffs in the case, labelled France's "trial of the decade", that has exposed the murky ties between the country's political elite and the secret services.
The trial opened in September 2009 in the courtroom where Marie Antoinette was sentenced to the guillotine in 1793, with Villepin accusing Sarkozy of pursuing a personal vendetta against him.
Prosecutors argued that while Villepin did not deliberately take part in a plot to smear Sarkozy, he did nothing to stop the scandal from spiralling out of control because he hoped to gain a political advantage.
In his defence, Villepin said he never knew that the list was false and never sought to use it against Sarkozy.