MANADO, Indonesia (AP) – An Indonesian court on Tuesday acquitted an American executive and his company, Newmont Mining Corp., of dumping dangerous levels of toxins into a bay and sickening villagers, a verdict likely to cheer foreign investors and anger environmentalists.

Richard Ness, 57, faced a maximum 10 years in jail and a $60,000 fine.

Presiding judge Ridwan Damanik told the Manado District Court that evidence presented during the 20-month criminal trial proved waste rock dumped into the water by the Denver-based company’s now-defunct mine on Sulawesi island did not exceed government standards.

“There also is not enough evidence that people suffered from health problems,” the judge said, drawing cheers from Newmont’s supporters in the sweltering court. Defense lawyers and family members threw their arms around the smiling Mr. Ness.

Prosecutors immediately said they would appeal as hundreds of demonstrators ringing the building chanted, “Reject the verdict!”

The trial was being closely watched by foreign investors already wary about legal uncertainties in Indonesia, which boasts some of the world’s largest gold, tin, copper and nickel deposits but is also considered among the most corrupt nations.

Red tape and rising prices add to their concerns.

“A guilty verdict would of course affect the investment climate,” Witoro Soelarno, of Indonesia’s energy and mineral resources department, said before the verdict was announced. He noted that foreign companies have all but abandoned the mining sector since the 1997-98 Asian financial crisis.

“We would have to work ever harder to lure them back,” he said, pointing also to concerns about a draft mining bill that would require companies to work with regional authorities instead of the central government.

Environmentalists had hoped the cash-strapped government would find a multinational corporation guilty of pollution charges, noting that the country’s unique and rich ecosystem were steadily degrading.

About 1,000 protesters gathered outside the tightly guarded court Tuesday, some holding banners that said “Sentence Newmont!” and “Improve Indonesia’s environmental laws!” Others rallied in the coastal city on motorcycles, snarling traffic.

“We want Newmont and its director to take responsibility for what they’ve done,” protest organizer Didi Koleangan said ahead of the verdict, referring to allegations villagers living near Buyat Bay complained of skin disease, lumps, breathing difficulties and dizziness.

Though evidence presented to the court was limited to a few villagers complaining of itchiness, some activists say follow-up research should be conducted for up to 30 years to make sure they are not suffering from body arsenic accumulation.

Newmont began operations in Sulawesi in 1996, but the company stopped mining in 2004 after extracting all the gold and ore it could.

Last year, Newmont reached a $30 million out-of-court settlement with the government to defuse a separate civil lawsuit over alleged toxic pollution in the bay, and it could have been fined another $100,000 Tuesday.