The jury -- which found that AEG hired Dr. Conrad Murray and that he was a competent doctor -- did not award any money to the singer's mother Katherine Jackson or his three children. They had been seeking damages of more than $1 billion.
It took only three days for the jury to reach the verdict after a five-month trial that included dozens of witnesses.
Immediately after the verdict, jurors agreed to talk to attorneys behind closed doors. They have yet to address reporters.
But in a written statement, AEG's lead attorney, Marvin Putnam said: “The jury’s decision completely vindicates AEG Live, confirming what we have known from the start -- that although Michael Jackson’s death was a terrible tragedy, it was not a tragedy of AEG Live’s making."
Randy Phillips, an AEG executive named in the lawsuit, said in a statement: "We lost one of the world’s greatest musical geniuses, but I am relieved and deeply grateful that the jury recognized that neither I, nor anyone else at AEG Live, played any part in Michael’s tragic death."
Katherine Jackson left the courthouse without talking to reporters.
Several fans had gathered to hear the verdict.
"I don't like it," said Leslie Cole, 41. "I really don't like it."
Barbara De L'orme, 42, of Studio City, wore a T-shirt with a picture of Katherine Jackson. She said she felt devastated by the verdict.
"My heart is broken," she said. "This was the greatest artist that we ever had and they treated him like this. The evidence was right there."
Jackson’s mother and three children brought the lawsuit, saying AEG Live hired and supervised Murray, who gave Jackson the fatal dose of the anesthetic propofol.
The family’s attorney painted a picture of a cold, calculating entertainment enterprise that failed to notice that Murray was financially desperate and then pushed the physician to get Jackson ready to tour even though the singer was in frail health and was crippled by fear.
"They're going to kill me, they're going to kill me,'" Jackson’s eldest son, Prince, testified, recalling the singer's words in one his final conversations with his father.
The Jackson family’s legal team asked jurors to award $85 million to each of the pop star’s children and another $35 million to his mother. In addition, lawyers suggested AEG be asked to pay as much as $1.5 billion in economic losses.
AEG tried turning the tables during the trial, all but putting Michael Jackson on trial. AEG said Jackson was the one who brought aboard Murray and that the singer was a fully-formed drug user who had demanded anesthetics as a sleep aid during earlier tours. AEG said it was Jackson who planted the seeds of his demise.