Two Washington men, jailed since last December in connection with the highly publicized 1974 quadruple slaying at a Landover liquor store, were released yesterday after the Prince George's County State's Attorney's Office filed a motion to dismiss the charges.

The state's attorney's decision not to prosecute follows revelations last month that the rights of two key state witnesses and a defendant had been violated during the investigation into the lslaying.

Prosecutors said yesterday, however, that the dismissal of the charges against the two men does not mean the case has been closed.

"There are matters known to police that could result in rearrests or in new arrests," said County State's Attorney Arthur Marshall yesterday. He said that his office has reasons to believe that more than two people were involved in the crime.

Marshall said that his request for a dismissal, which followed the filing of a defense motion demanding that the state show cause why one defendant was still being held, was made when it became clear that there was a lack of evidence of sufficient weight to result in convictions.

Thomas Butler, 39, and his brother James Calvia Butler, 32, were being held on murder charges in connection with the killings of R. Earie Sheriff Sr., the 32-year-old owner of the Kent Village Liquor Store; his wife, Clara, 75, and two delivery men for a wholesale liquor distributing company, William E. Deets, 20, and Melvin F. Montgomery, 22.

Both brothers were released yesterday from the Prince George's County jal. However, Thomas Butler was released into the custody of Washington police who charged him with armed robbery in connection with an unrelated crime.

According to police, shortly before 8 a.m. Oct. [WORD ILLEGIBLE] 1974, armed men forced Sheriff and his wife into a walk-n cooler at the rear of the [WORD ILLEGIBLE] and took the delivery men to a [WORD ILLEGIBLE] room where one of them was handcuffed to a pipe.

The men then ransacked the store, apparently in search of cash that Sheriff used to cash checks and make small loans.

The Sheriffs were then taken to the back room with the delivery men where all four victims were doused with a flammable liquid and set ablaze, police said. Montgomery, who apparently tried to flee, was found shot in the back.

It was the fire, police said, that [PARAGRAPH ILLEGIBLE] after a witness, who had been in the store earlier that day, picked his photograph from [WORD ILLEGIBLE]

[WORD ILLEGIBLE] with the prosecution's case first appeared during the Jan. 26 as preliminary hearing for the Butlers when two prosecution witnesses testified that police held them for several days without warrants, while questioning them.

Those witnesses subsequently provided information that led to the arrests of the Butler brothers.

At the same hearing, police, under cross exaimination by defense attorneys, admitted that they held Thomas Butler for more than 18 hours before allowing him to appear before a judicial commissioner for an initial hearing on the merits of his detention. As a result, County District Court Judge James Magruder Rea refused to consider an alleged admission of involvement in the crime given police by Thomas Butler during the 18-hour period.

In addition, the only witness to identify James Butler as having been involved in the crime was found to have misidentified pictures of James Butler when shown them by police right after the crime.