UPDATE 2-W.R. Grace acquitted in asbestos case, shares leap

Fri May 8, 2009 10:16pm BST

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* W.R. Grace and three execs acquitted in asbestos suit

* CEO "gratified" by verdict; shares leap 36 pct (Adds CEO statement, background, byline)

SAN FRANCISCO, May 8 (Reuters) - A federal jury in Montana acquitted chemical company W.R. Grace & Co (GRA.N: Quote, Profile, Research) and three of its executives on Friday on all counts in an asbestos environmental case, and its stock surged 36 percent.

The company and executives had been charged by a division of the Justice Department with knowingly endangering the lives of mine workers and other residents of Libby, Montana, near the Canadian border, and ignoring warnings by state agencies.

"We at Grace are gratified by today's verdict," Grace Chief Executive Fred Festa said in a statement on Friday.

"We always believed that Grace and its former executives had acted properly and that a jury would come to the same conclusion when confronted with the evidence," he said.

The case had been brought by the Justice Department's Environment and Natural Resources Division and the U.S. attorney for the district of Montana.

"The verdict was returned earlier today in open court: not guilty on all counts for all defendants," said Patrick Duffy, a clerk at the federal court in Missoula, Montana. Continued...