A judge has dismissed federal charges filed against San Diego Gas & Electric Co. and three workers accused of conspiracy and violation of safety standards during an asbestos removal at a Lemon Grove site six years ago.

U.S. District Court Judge Dana Sabraw dismissed the five-count indictment Tuesday, ruling that prosecutors failed to perform proper tests to determine the amount of asbestos at the site, The San Diego Union-Tribune reported.

U.S. Attorney Carol Lam issued a statement saying she disagreed and plans to appeal, according to the Union-Tribune.

The indictment named the utility, along with SDG&E employees Jacquelyn McHugh and David Williamson. Kyle Rhuebottom, the project superintendent for contractor IT Corp., also was charged, the newspaper reported.

If convicted, each worker would have faced a maximum sentence of five years in prison and a $250,000 fine for each charge. SDG&E faced up to a $2.5 million fine, according to the Union-Tribune.

The 16-acre site at the border of Lemon Grove and San Diego's Encanto neighborhood housed SDG&E's Encanto Gas Holder Facility. The utility began clearing the land, including 9.3 miles of pipe coated with asbestos, in 2000 to sell it to a developer.

Federal prosecutors alleged that to save time and money, SDG&E and its workers told government inspectors that the pipes did not pose a hazard. SDG&E contended that removal of the material was done safely and did not require government regulation, the newspaper reported.

Sabraw said in his ruling that prosecutors should not have used a testing method that deemed the pipes hazardous as long as one of the six layers of material wrapped around them was found to contain asbestos, the newspaper reported.

Instead, he ruled, prosecutors should have used a testing method in which the asbestos content for all of the layers was averaged to determine whether regulation was required, according to the newspaper.

Because prosecutors failed to use the proper test, he said the indictment must be dismissed, the Union-Tribune reported.