VESZPREM, Hungary – A judge on Wednesday dismissed prosecution demands that the head of a metals company linked to Hungary’s devastating red sludge spill be charged with negligence. The man has been released from police custody, his lawyer said.

Appearing after a closed court hearing on the case, lawyer Janos Banati said the judge ruled in Zoltani Bakonyi’s favor after finding that prosecutors couldn’t substantiate their argument that he did not have sufficient emergency and rescue plans in case of accidents like the sludge spill.

Banati said prosecutors were preparing an appeal.

The decision was sure to embitter hundreds of villagers who blame the management of MAL Rt. for the deaths of nine people, the hundreds of homes left uninhabitable and the poisoning of local waterways. About 184 million gallons of caustic sludge and water burst from a storage pool of a metals plant Oct. 4, inundating three western Hungarian towns and spilling into the Danube River.

“Life won’t be returning to normal for a very, very long time,” said Devecser Mayor Tamas Toldi, whose town was one those swamped by the toxic slurry.

Authorities said that cracks in the wall of the broken reservoir appear not to have grown wider, calming some fears that further collapse would release a second flood of sludge.

One village remained evacuated Wednesday and residents in Devecser were ready to leave on short notice. But Toldi said he hoped the state of alert could be called off later in the day once a protective wall in neighboring Kolontar meant to contain any new spill had been completed.

Banati said Wednesday’s ruling reflected defense arguments that the company had emergency plans which had been approved by government authorities and that did not need updating when Bakonyi took over two years ago. Banati also said he knew of no incriminating testimony against Bakonyi from employees of his firm.

Bakonyi is the managing director of MAL Rt., or the Hungarian Aluminum Production and Trade Co., which owned the reservoir. It is part of the Ajkai Timfoldgyar plant in Ajka, 100 miles southwest of Budapest.

The red sludge that spilled after a part of the reservoir wall partially collapsed is a highly caustic byproduct of alumina production, which is used to make aluminum.