Albert Woodfox, 68, was placed in solitary confinement at Louisiana State Penitentiary at Angola and other facilities in the state, due to a since-overturned conviction for the death of a guard during a 1972 prison riot.
US District Judge James Brady ordered Woodfox's unconditional release, and barred any further trial on the murder charges.
"Evidence supporting claims of Mr Woodfox's innocence gives this Court even more reason to question his two previously overturned convictions," Brady wrote in his order.
Woodfox has long maintained his innocence, namely citing a witness who said he was not involved in the murder, as well as scientific review of evidence at the scene that exculpated him and a polygraph test that found he had truthfully denied his involvement.
Brady's order "arbitrarily sets aside jury decisions" based on "faulty procedural issues," Louisiana Department of Justice spokesman Aaron Sadler was quoted as saying by local media.
"With today's order, the court would see fit to set free a twice-convicted murderer who is awaiting trial again for the brutal slaying of Corrections Officer Brent Miller."
In addition to Woodfox's age and "poor health," the judge also listed his "lack of confidence in the state to provide a fair third trial, the prejudice done onto Mr Woodfox by spending over 40 years in solitary confinement, and finally the very fact that Mr Woodfox has already been tried twice and would otherwise face his third trial for a crime that occurred over 40 years ago.
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