Washington -- Lewis "Scooter" Libby, Vice President Dick Cheney's chief of staff and a key architect of the Iraq war, was indicted Friday on felony charges of perjury, making false statements and obstruction of justice for allegedly impeding the grand jury investigating the CIA leak case.

The five-count indictment alleges that Libby lied to FBI agents who interviewed him on two occasions, perjured himself during two appearances before the grand jury, and obstructed justice when he "knowingly and corruptly endeavored to influence, obstruct and impede" the grand jury's efforts to find out who leaked Valerie Plame's status as a covert agent to reporters during the spring of 2003.

Within minutes of the indictment, Libby resigned his post.

Karl Rove, President Bush's senior political adviser and deputy chief of staff, was not charged with any crime, but lawyers involved in the case say he may not be out of legal jeopardy.

Special Counsel Patrick Fitzgerald said at an afternoon press conference at the Justice Department that the bulk of the investigation had been completed, but a federal grand jury could pursue further charges if new evidence emerges. He would not comment on whether Rove was being looked at as a possible target of the investigation.

Although the grand jury did not indict Libby for the leak of Plame's name, Fitzgerald insisted that the obstruction of justice charge was "a very serious matter."

"The need to get to the bottom of what happened and whether national security was compromised by inadvertence, by recklessness, by maliciousness is extremely important," he said. "We need to know the truth. And anyone who would go into a grand jury and lie and obstruct and impede the investigation has committed a serious crime."

The case has centered on whether administration officials deliberately revealed Plame's identity in July 2003 in retaliation against her husband, former ambassador to Joseph Wilson. Wilson had cast doubt on the administration's claims that Iraq had weapons of mass destruction when he wrote a July 6, 2003, op-ed in the New York Times entitled, "What I Didn't Find in Africa."

Libby, in discussions with FBI agents and the grand jury, maintained that he heard about Plame's covert status in discussions with journalists, according to Fitzgerald.

But the indictment alleges that Libby actively sought out information from government officials about Wilson's trip to Africa and played a central role in spreading information about Wilson's wife's status as a secret CIA operative.

Fitzgerald, in his news conference, said Libby was the first person to tell a reporter that Plame worked for the CIA, which took place in a meeting with Judith Miller of the New York Times on June 23, 2003.

The indictment said that Libby made false statements to FBI agents on Oct. 14 and Nov. 23 of 2003 regarding his discussions with NBC Bureau Chief Tim Russert and Time magazine reporter Matthew Cooper.

Libby also was charged with perjury for allegedly lying to the grand jury about his conversation with Russert on July 10, 2003. In short, Libby told the grand jury that the veteran journalist had told him about Plame, not vice-versa.

"In fact, Russert did not ask Libby if Libby knew that Wilson's wife worked for the CIA, nor did Russert tell Libby that all the reporters knew it," the special counsel said in a press release about the charges. "And at the time of their conversation, Libby was well aware that Wilson's wife worked at the CIA."

Russert, appearing on MSNBC, said Wilson's never came up in his conversation with Libby, which involved Libby complaining about a separate MSNBC report.

The grand jury believed that Libby obstructed justice by telling them under oath that he told Cooper of Time magazine only "what other reporters were saying about Plame. But the indictment accuses Libby of knowing about Plame's covert status from his own sources and confirming the information to Cooper.

"At the end of the day, what appears is that Mr. Libby's story that he was at the tail end of a chain of phone calls, passing on from one reporter what he heard from another, was not true. It was false," Fitzgerald said.

"He was at the beginning of the chain of the phone calls, the first official to disclose this information outside the government to a reporter, and that he lied about it afterward under oath and repeatedly."

Obstruction of justice carries a maximum penalty of 10 years in prison, and perjury and making false statements carry maximum penalties of five years. If convicted on all charges, Libby could face a maximum 30 years in prison and a 1.25 million fine.

The indictment could expose the highly secretive discussions by top White House officials in the build-up to the Iraq war. The case will also showcase the long-running feud between the CIA and the White House over intelligence about weapons of mass destruction in Iraq that helped justify the U.S. invasion in March 2003.

"This should have been played out in congressional hearings to delve into the reasons for going to war," former U.S. attorney Joseph DiGenova said on CNN Friday.

"Now we are going to have this played out in a criminal trial, which is not a good way to discuss public policy, but it's going to happen."

Legal analysts suggested the vice president, former CIA chief George Tenet, Rove and other current and former administration officials could be called to testify at Libby's trial. Journalists including Miller, Russert, Cooper, syndicated columnist Robert Novak and others are also expected to testify.

President Bush said he was saddened by Libby's indictment and resignation, adding "in our system each individual is presumed innocent and entitled to due process and a fair trial."

Bush, in a brief statement at the White House, said the departed aide had "sacrificed much" and served in "extraordinary times in our nation's history."

But, the president said, he and his staff would not be distracted by the continuing legal case.

"We've got a job to protect the American people, and that's what we'll continue working hard to do," the president said.

Cheney, who met with Libby Friday morning before traveling to Georgia, planned to release a written statement about the indictment of his top aide later Friday.

Rove appeared immediately relieved by the news. As he left his home at 7:45 a.m. this morning, a reporter asked: "Are you in a good mood?" Rove replied: "A very good mood today. I'm going to have a very good day."

E-mail Zachary Coile at zcoile@sfchronicle.com.

Commentary:
Many words will be written about the corruption of our times (war for no reason, record debt etc.). At the top of the food chain in the Bush Administration.

The reason Libby was indicted was because there's a paper trail proving he knew about Ms. Wilson before he heard it from the press. He lied to the Grand Jury.

Rove also told the Grand Jury he learned about Ms. Wilson from the press and it was a lie also. The difference is Fitzgerald gave him four chances to tell the truth and weeks before the investigation ended he finally told the truth.

A pathological liar shouldn't work in a White House that claims to do the work of God.