A federal judge declared a mistrial Tuesday in the stock manipulation case against chemical company GAF Corp. and one of its key officers, deciding that the government's failure to disclose possible tampering with a key piece of evidence unfairly hurt the defendants.

The ruling by U.S. District Judge Mary J. Lowe stunned a packed courtroom, but the judge said she intended to start picking a jury Wednesday morning for a new trial.She denied an immediate defense motion to have all the charges dismissed, and defense attorneys said they would appeal her denial, contending that another trial violates their clients' constitutional rights.

Jury selection in the now-halted trial began Dec. 12.

The stock manipulation charges against GAF and vice chairman James T. Sherwin is one of the major cases arising out of the Ivan Boesky insider trading scandal. It was considered a major test of the government's ability to successfully prosecute Wall Street trading abuses.

The government's case relied partly on an invoice sent to GAF by Jefferies & Co., a Los Angeles brokerage that conducted stock trades for the company.

A line on the invoice produced by the government was partly obscured, but U.S. prosecutors failed to inform the defense about the possible tampering prior to the trial as required under criminal rules of evidence.

A federal grand jury indicted GAF and Sherwin last July on charges they manipulated the price of Union Carbide Corp. stock through Jefferies in an attempt to drive up its price.