A federal court has ruled that the Federal Communications Commission had the right to dump net-neutrality rules, but couldn’t bar states like California from passing their own.

The ruling is largely a victory for FCC Chairman Ajit Pai, a Trump administration appointee, who championed a repeal of the Obama-era rules.

The 2015 net neutrality rules had barred internet providers such as AT&T, Comcast and Verizon from blocking, slowing down or charging internet companies to favor some sites or apps over others.

Without these rules, phone and cable companies can interfere with internet traffic as long as they disclose it.

Tuesday’s decision came from the U.S. Court of Appeals for the District of Columbia Circuit.

New York Attorney General Letitia James called the court decision “unfortunate.”

“We stand committed to protecting our residents by treating all internet traffic equally, defending access, innovation, and competition,” James said in a statement.

“It’s unfortunate that the court has sanctioned the federal government’s abandonment of those principles.”

However, the decision could be bad news for the Internet because of the state power aspect in the ruling, according to the Internet Innovation Alliance.

“The decision by the U.S. Court of Appeals for the D.C. Circuit upholding the Federal Communications Commission’s open internet rules deserves applause from everyone who wants to see an expansion of innovation, competition and investment in the internet ecosystem,” the alliance said.

“But ruling that the FCC can’t block state laws and thus allowing rules that differ among all 50 states could spell disaster for advancement of the internet, as web services are offered on a national basis, and many would be disrupted by a multiplicity of diverse and contradictory state net neutrality requirements.”

Jonathan Spalter,CEO of  business trade group USTelecom, hailed the decision.

“The court got it right and affirmed what anyone who has been paying attention to Washington’s net neutrality saga knows to be true: the internet is open, ISPs are investing to bring internet users the content they want, and we remain absolutely opposed to anti-consumer practices like blocking, throttling and anti-competitive paid-prioritization,” he said.

“The fact is the FCC’s 2017 order restored the smarter, more nimble, pro-consumer and bipartisan policy framework that has guided the internet through 20 years of openness and extraordinary growth.”

Net neutrality has evolved from a technical concept into a politically charged issue, the focus of street and online protests and a campaign issue lobbed against Republicans and the Trump administration.

The FCC has long mulled over how to enforce it. The agency had twice lost in court over net-neutrality standards before a Democrat-led commission in 2015 voted in a regime that made internet service a utility , bringing phone and cable companies under stricter oversight.

The telecom industry sued that step but lost. An appeals court sanctioned the 2015 rules.

After the 2016 election, President Donald Trump appointed a more industry-friendly FCC chairman. Pai repealed the net neutrality rules in 2017, saying they had undermined investment in broadband networks. That meant ISPs could interfere with internet traffic as long as they disclosed it.

But the issue didn’t end there. States had come up with their own net neutrality laws, including one in California that was put on hold until the appeals court decision. The FCC argued that states couldn’t come up with their own rules that ran counter to the federal policy.