A federal appeals court ruled Tuesday against a New Jersey law that banned private companies from contracting with the federal government in immigration enforcement. The ruling is the latest win for President Donald Trump‘s federal immigration policies.

In a 2-1 decision, the U.S. 3rd Circuit Court of Appeals agreed with a private prison company that had argued that the state law, which banned new contracts for civil immigrant detention with private companies, harps on federal authority. 

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In the majority opinion, Judge Stephanos Bibas wrote that while the law’s text is not applicable to the federal government, it still attempts to circumvent federal immigration policy.

“Only the federal government has the power to decide whether, how, and why to hold aliens for violating immigration law. It alone has the power to make these contracts in the first place,” Bibas wrote. “So this ban is in substance a direct regulation; it destroys the federal government’s marketplace.”

The law had prohibited the state and local governments from entering into, renewing, or extending contracts with private companies to detain people for civil immigration violations. It was passed by the New Jersey state legislature and enacted into law by Gov. Phil Murphy (D-NJ) in 2021.

In 2023, private prison company CoreCivic sued the state, arguing the law unlawfully prevented it from renewing a contract with U.S. Immigration and Customs Enforcement in relation to the Elizabeth Detention Center.

A federal judge that year similarly ruled in CoreCivic’s favor. The state appealed that ruling. The Tuesday ruling upheld the lower court’s ruling.

CoreCivic spokesman Ryan Gustin said in a statement that the company was “grateful” for the ruling.

“CoreCivic does not enforce immigration laws, arrest anyone who may be in violation of immigration laws, or have any say whatsoever in an individual’s deportation or release. CoreCivic also does not know the circumstances of individuals when they are placed in our facilities. Our responsibility is to care for each person respectfully and humanely while they receive the legal due process that they are entitled to,” Gustin said.

Judge Thomas Ambro in his dissent said the majority’s argument infringed on state sovereignty and went beyond constitutional doctrine.

“Congress, not courts, is supposed to determine which federal functions are sufficiently important that they displace otherwise valid state law,” he wrote.

ALINA HABBA REPLACED AS NEW JERSEY’S TOP PROSECUTOR

New Jersey Attorney General Matthew Platkin expressed disappointment in the ruling, saying in a statement “We are disappointed in the Third Circuit’s ruling this morning invalidating our law prohibiting private immigration detention.”

“As recent events at Delaney Hall underscore,” Platkin added, in reference to a Newark, New Jersey detention center. “entrusting detention to for-profit companies poses grave risks to health and safety, and as the dissenting judge noted, States retain broad latitude to protect the health and safety of people within their borders – particularly where, as here, there is no conflict with federal legislation.”