In a huge victory for organized labor, a split en banc panel of the 9th Circuit U.S. Court of Appeals upheld a controversial California law last week that prohibits state contractors from spending state dollars on union-busting efforts.

The 12-3 decision overturns a district court’s ruling from 2003 — and a subsequent three-judge 9th Circuit panel — that struck down the law on the grounds that it violated employers’ First Amendment rights and conflicted with federal labor regulations.

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