A U.S. appeals court on Monday reinstated global-warming lawsuits brought by eight states, New York City and three land trusts against several large utility companies, seeking to limit their carbon-dioxide emissions.

In an order Monday, the Second Circuit Court of Appeals vacated a district judge's 2005 ruling tossing out the cases, saying the lower court erred in dismissing the complaints against utilities that operate fossil-fuel-fired electricity plants in 20 states.

"This case is a critical milestone, allowing global warming cases to be decided by the courts, just as they decide complex water pollution, air pollution, and toxic dumping cases," said Jerry Brown, attorney general of California, a plaintiff in one of the suits that was reinstated.

The utilities had argued, in part, that allowing a court to unilaterally order emissions reductions would interfere with the president's efforts to induce other nations to reduce their emissions.

"A decision by a single federal court concerning a common law of nuisance cause of action, brought by domestic plaintiffs against domestic companies, does not establish a national or international emissions policy," U.S. Circuit Judge Peter W. Hall wrote. "Nor could a court set across-the-board domestic emissions standards or require any unilateral, mandatory emissions reductions over entities not party to the suit."

The cases were seeking to limit and ultimately reduce carbon emissions at six domestic coal-fired electricity plants, rather than ask the court to "fashion a comprehensive and far-reaching solution to global climate change," Judge Hall wrote.

U.S. District Judge Loretta Preska in Manhattan dismissed the cases in 2005, saying the question of whether carbon-dioxide emissions should be reduced laid with Congress, not the courts.

The utilities are American Electric Power Co. (AEP), Southern Co. (SO), Xcel Energy Inc. (XEL), the federal government-owned Tennessee Valley Authority and Cinergy Corp., which was acquired by Duke Energy Corp. (DUK) in 2006.

One of the lawsuits reinstated was brought by the states of New York, Connecticut, California, Iowa, New Jersey, Rhode Island, Vermont and Wisconsin, plus New York City. The other was brought by land trusts Open Space Institute Inc., Open Space Conservancy Inc. and the Audubon Society of New Hampshire.

"This ruling restoring our legal action breathes new life into our fight against greenhouse gas polluters and changes the legal landscape to impose responsibility where it belongs," said Connecticut Attorney General Richard Blumenthal in a statement. "Our legal fight is against power companies that emit a huge share of our nation's CO2 contamination, but it will set a precedent for all who threaten our planet with such pernicious pollution."

In a statement, New York Attorney General Andrew Cuomo said, "This is a game-changing decision for New York and other states, reaffirming our right to take direct action against global warming pollution from power plants. Today's decision allows us to press this crucial case forward and address the dangers posed by these coal-burning power plants. My office will continue to be a leader in the fight to tackle the risks global warming poses to our environment, public health and economy."

The cases were remanded to Judge Preska for further proceedings.

New U.S. Supreme Court Justice Sonia Sotomayor was on the three-judge panel that heard arguments in the case in 2006. However, Sotomayor wasn't involved in the decision as a result of her elevation to the high court.

Representatives at AEP, Southern, Xcel and Duke said employees at their companies were still reviewing the decision and wouldn't comment until they had had a chance to read the entire 139-page document. A TVA spokeswoman said TVA had just received the decision and will review it in its entirety.

-By Chad Bray, Dow Jones Newswires; 212-227-2017; chad.bray@dowjones.com