Chairman of the bench Graham Peace said the small number of complaints about the camp – all from staff at BBC Radio Leicester – did not warrant the police action.
He criticised Inspector Simon Preston, who ordered the dispersal using section 34 of the Anti-social Behaviour, Crime and Policing Act 2014.
Mr Peace said: "We've come to the conclusion the section 34 order was unlawful.
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During the trial Insp Preston had agreed under cross-examination that he decided to make the dispersal order after two phone calls from employees of BBC Radio Leicester.
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