First, he threw out the charges of first degree murder. The jury will be able to consider murder charges during deliberations, but only in the second degree.
Perry said the shooting of Oscar Grant happened "in a manner suggesting an absence of premeditation." He said evidence is "clearly insufficient to support a first degree murder charge, but could reasonably support second degree murder."
Mehserle has pleaded not guilty to murdering Grant on New Year's Day 2009.
With Perry throwing out the first degree murder charge, the jurors have the options of second degree murder, voluntary manslaughter, involuntary manslaughter or acquittal.
Grant's family said they were disappointed by the judge's decision, but knew it was possible.
The difference between a verdict of first degree murder and second degree murder is in sentencing. Second degree is 40 years to life. First degree is 50 years to life in prison.
Deliberations will start either Thursday afternoon or Friday morning. The court might stay court open until 7 p.m. if necessary either day. In a surprise move, a court public information officer said if the verdict comes back late Friday and there are concerns about violence or rioting, they may hold its release until Saturday morning.
We also learned Wednesday that there is a juror on the panel who leaves on vacation next Wednesday. Perry said in court, if a verdict is not met by Tuesday at the close of business, the panel will have to start deliberations over with an alternate juror come July 7.
Jurors have Wednesday off. They will hear closing arguments under the new rulings Thursday morning. Following instructions, they will begin deliberations.
Mehserle's lawyer, Michael Rains, wanted the jury to be able to consider only second-degree murder or acquittal, so the judge's decisions Wednesday did not go his way. East Bay attorney Michael Cardoza says Rains was going for an all or nothing approach. The judge denied that motion and gave the jury four options.
The trial is being held in Los Angeles but police, business owners and regular folks in Oakland are preparing for possible trouble once the verdict is reached. Late last week, Oakland city leaders sent out a few tips for people to keep their properties and vehicles safe, in case of post-verdict protests that could become violent.
Oakland authorities call the preparation "Operation Verdict" and are spending Wednesday setting up a command center at the Port of Oakland.
In a community bulletin issued Friday officials advised residents to park cars in a secure location, remove large trash bins from the curb and report any vandalism or destruction they see by calling 911.
In the early weeks of 2009, protests turned into riots. Dozens of businesses were vandalized, causing hundreds of thousands of dollars in damage.
The worry is a verdict of not guilty, or even guilty of the lesser charge of manslaughter, protests could turn violent again.
Even before the trial began, protest organizers announced that they would meet at 16th and Broadway in Oakland at 6 p.m. the day the verdict is read. They said they would decide what to do and where to go once they know the outcome.