Birmingham, Ala. ? Jurors acquitted HealthSouth Corp. founder and fired Chief Executive Richard Scrushy on Tuesday of all charges related to a $2.7 billion earnings overstatement at the chain of rehabilitation and medical-service centers.

The sweeping acquittal in the 36-count indictment ended a five-month trial with a huge victory for an embattled corporate chief after a series of convictions in other high-profile business scandals.

As the “not guilty” verdicts were read on count after count, Scrushy started crying. He pulled out a handkerchief and began wiping his eyes. After the final count, he reached around and hugged his wife, Leslie, in the first row behind the defense table.

Scrushy, charged with fraud, false corporate reporting and making false statements to regulators, was the first CEO charged under the Sarbanes-Oxley corporate reporting law.

But Scrushy, tried in the city where he has been a generous philanthropist, blamed the massive accounting scheme on subordinates including all five finance chiefs who served under him at HealthSouth.

“I’m disappointed in the verdict,” U.S. Atty. Alice Martin said after the verdict was read.

Leslie Scrushy and her husband, Richard Scrushy, leave court Tuesday in Birmingham, Ala., after Richard Scrushy was acquitted of all charges in his federal trial. Defense attorney Donald Watkins is pictured at right.

In all, 15 former HealthSouth executives have pleaded guilty since 2003, when the scandal erupted and drove the company to the brink of bankruptcy.

The decision came in the fifth day of deliberations since U.S. District Judge Karon Bowdre replaced a sick juror with an alternate and told the panel to start work anew. It was the 21st day of deliberations overall.

The scandal had a devastating effect on HealthSouth, which teetered on the edge of bankruptcy for months despite once having more than 50,000 employees at 1,900 locations in all 50 states and a stock price around $30.

Today, HealthSouth stock trades around $6 after being delisted from the New York Stock Exchange. Layoffs and closings reduced employment to about 41,000 people at 1,380 sites.

Witnesses testified the conspiracy began in 1996, when they said HealthSouth switched from “aggressive accounting” to outright fraud at Scrushy’s direction.

The first of 15 corporate officers and midlevel accounting executives to admit being part of the scheme pleaded guilty in March 2003, when the government filed suit against HealthSouth and Scrushy alleging a massive fraud.

Scrushy’s defense team blamed the fraud on that group, particularly the five finance chiefs who worked under Scrushy and testified against him.