Raymond Davis, a CIA contractor accused of murdering two men in Lahore, Pakistan, has been released after the families to the two men he killed were given "blood money" and the case was dropped, Pakistani officials said.
While Davis, who had earlier admitted to the killings but said he was acting in "self-defence", was indicted for the murders earlier on Wednesday, Rana Sanaullah, the Punjab law minister, said he was immediately pardoned by the families of the victims in exchange for compensation or "blood money".
The practice of pardoning those accused of murder under such an arrangement is permitted under Pakistani law.
Kamal Hyder, Al Jazeera's correspondent in Peshawar, said the families' lawyer had claimed they were forced to sign the agreement over the blood money, but none of the family members have spoken out so far.
"There is likely to be a public reaction, despite the fact that the court had moved according to the law of the land," he said.
The amount of money agreed to has not been made clear.
Davis had been arrested on January 27, after having killed the two men on a street in Lahore. He said that the two men were attempting to rob him, and that he acted in self-defence.
Chaudhry Mushtaq, superintendent at Kot Lakhpat jail, said Davis left the jail with US consulate officials after the hearing.
US officials were not immediately available for comment.
Patty Culhane, Al Jazeera's correspondent in Washington, said there had been a lot of criticism about how the Obama administration had handled the case since the beginning.
The United States has consistently insisted that Davis had diplomatic immunity and had demanded that the Pakistani authorities release him immediately. The case has caused a diplomatic row between the countries, with the Pakistani government, under pressure from the public not to allow Davis immunity, leaving the matter up to the courts.
Pakistani officials had earlier suggested that the payment of "blood money" was the best solution. Lawyers for the victims however suggested that they were forced to sign the deal.
"We were put in detention for four hours and not allowed to meet our clients who were called by authorities to the court," Asad Manzoor Butt, a lawyer for the family of one of victims told Reuters.
Sanaullah said Davis was formally indicted on murder charges before members of the two victims' families were taken into the court, where they signed papers formally forgiving him in exchange for an undisclosed sum of money.
Judges then acquitted him on all charges, he said.