In a hearing, New York Assistant District Attorney Joan Illuzzi-Orbon said her office no longer trusted the testimony of Strauss-Kahn's accuser, a housekeeper at the Sofitel New York hotel who said Strauss-Kahn violently attacked her May 14.
As the investigation proceeded in recent weeks, Illuzzi-Orbon said, there had been "salient, confirmed impeachment" of the woman's story, from a concocted tale of political repression and gang rape in Guinea that was used to gain political asylum in the United States in 2004 to her shifting account of what happened May 14 in the $3,000-a-night suite.
Prosecutors said they still believe a "sexual encounter" occurred between the two, something "corroborated by forensic evidence" collected after Strauss-Kahn, 62, was arrested, Illuzzi-Orbon said in remarks submitted to the court.
District Attorney Cyrus R. Vance Jr. portrayed the turnabout as a case of prosecutors doing the right thing.
"Our commitment to the truth and the facts will govern how we proceed" in the Strauss-Kahn case, he told reporters.
Neither he nor Strauss-Kahn's lawyers took questions.
Authorities have not said specifically what they now think of the truthfulness of the woman's allegations against Strauss-Kahn. Investigators found traces of his semen on her uniform, and that is powerful evidence there was a sexual encounter of some kind, though the defense has said anything that happened was not forced.
Prosecutors at the time wanted him kept him in jail, arguing that because of the seriousness of the charges, he might flee the country. In releasing Strauss-Kahn on Friday, State Supreme Court Justice Michael Obus said: "In light of recent developments, the risk that you would not be here appears to have receded quite a bit."
If the case collapses, it could once again shake up the race for the French presidency. Before the scandal, Strauss-Kahn, a prominent Socialist, had been seen as a leading potential challenger to conservative President Nicolas Sarkozy. French politician Michele Sabban said the Socialists should suspend the presidential primary calendar because of the new developments.
The new doubts about Strauss-Kahn's accuser could also feed suspicions in France that he was the victim of a politically motivated setup.
Indeed, Maxime Laumailler, an economics student from Rennes, France, who was standing outside the New York courthouse, called the case "a plot" against Strauss-Kahn.
"We are so surprised that the Americans are pre-judging him like this," said Laumailler's girlfriend, Charlotte LeBihan.
After Friday's hearing, Strauss-Kahn returned to the brick townhouse. A deliveryman arrived a few hours later with an arrangement of red, white and blue balloons, along with one shaped like the Statue of Liberty.
The card read, "Enjoy your freedom on Independence Day," said deliveryman Sean Hershkowitz. He said he didn't know who sent the greeting.
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