A federal appeals court on Friday rejected a lawsuit by the owners of the natural-gas Constitution Pipeline challenging the state’s decision last year not to grant the water permits needed to build the pipeline.

The Constitution Pipeline Co. sued the state in May 2016, seeking to overturn a decision by the Department of Environmental Conservation to deny the company a water permit for the 121-mile pipeline. But the U.S. Court of Appeals for the Second Circuit on Friday sided with the state, arguing that the agency had the right to approve or reject the permit.

Judge Kearse

“In sum, NYSDEC is responsible for evaluating the environmental impacts of a proposed pipeline on New York waterbodies in light of the state’s water quality standards,” the unanimous decision written by Judge Amalya Kearse said. Judges Richard Wesley and Christopher Droney concurred. The court said it defers “to NYSDEC’s expertise as to the significance of the information requested from Constitution, given the record evidence supporting the relevance of that information to NYSDEC’s certification determination,” in Constitution Pipeline v. New York State Department of Environmental Conservation, Number 16-1568.

In a statement, Attorney General Eric Schneiderman lauded the court’s decision.

“It would be unacceptable for a pipeline—or any project—to pollute our waters and undermine New Yorkers’ health and water resources. Today’s decision marks a major win for New Yorkers, and for the state’s right to take the actions necessary to protect the public and our environment,” Schneiderman said.

The proposed Constitution Pipeline was slated to run from Pennsylvania into New York’s Southern Tier, which is on top of the Marcellus Shale, ending in Schoharie County.

The Constitution Pipeline, a partnership between Cabot Oil & Gas Corp., Oklahoma-based energy company Williams Companies, Piedmont Natural Gas and WGL Holdings, was represented in the lawsuit by John Stoviak and Elizabeth Witmer of Philadelphia-based Saul Ewing and Yvonne Hennessey of Barclay Damon in Albany.

Lawyers for Constitution Pipeline either did not return calls seeking comment or referred them to the company, which also did not return requests for comment.