The collapse of an unprecedented court action to criminalise unlawful industrial behaviour has emboldened the militant Construction, Forestry, Mining and Energy Union to pursue legal action against lawyers and state and federal police.

Despite a successful civil case imposing a record $1 million fine against the CFMEU Victoria for its black ban against concrete company Boral, the Victorian Director of Public Prosecutions made the shock decision on Wednesday to drop blackmail charges against the union's leader John Setka and his deputy Shaun Reardon over the ban.