DENVER (CBS4) – The Colorado Court of Appeals has sided with a gay couple in the fight over a wedding cake saying a baker cannot cite religious beliefs in refusing service.

Lakewood baker Jack Phillips, who owns Masterpiece Cakeshop, refused to make a wedding cake for Charlie Craig and David Mullins in 2012 saying it was against his religious beliefs. The couple married in Massachusetts but planned to celebrate in Colorado.

Craig and Mullins then sued Phillips and the court found that he violated the law preventing businesses from discrimination based on sexual orientation.

Phillips tried to appeal that order arguing that it violated his First Amendment rights. Both sides made their case to the Court of Appeals in July and the court took until now to rule in favor of the couple.

“We feel like the court today affirmed the argument that we have been making that the treatment we received at Masterpiece Cakeshop was both illegal and wrong,” Mullins said.

“The court basically validated what we’ve been fighting this whole time,” Craig said.

Phillips says he’s not opposed to making cakes for gay couples such as birthday cakes, holiday cakes and graduation cakes. It’s cakes for gay marriages he says he can’t do based on his religious beliefs. But the American Civil Liberties Union of Colorado said if he’s going to open a business to the public he has to make all services available to everyone in the public.

“When a business opens its doors to the public it can’t discriminate on the basis of sexual orientation, on the basis of race,” Mark Silverstein with the ACLU said after the ruling. “It can’t pick and choose customers based on who they are.”

The Colorado Court of Appeals was the latest stop in the three-year legal battle that’s tested the boundaries of religious freedom.

“I think that the ruling is wrong … the constitution guarantees me the right to practice my faith, my religion, anywhere, anytime; there are no restrictions on it,” Phillips said. “It also gives me the right to free speech, anytime, anywhere. I don’t surrender those rights when I open my doors.”

Phillips now faces fines if he declines to make wedding cakes for gay couples. After the state ordered him to make wedding cakes for everyone he stopped making them for anyone. He says it has cost him 40 percent of his business.

“Ton of support, most people are in agreement with us that a business and an American citizen should have the right to what they want to make and what they don’t want to make,” Phillips said.

Phillips’ lawyer said she will file the case with the state Supreme Court next month said they are willing to take the case to the U.S. Supreme Court.

Statement From Jack Phillips’s Lawyer

“Today’s ruling means that Colorado citizens have a First Amendment right to believe whatever they want and if those citizens hold the government approved views on same-sex marriage, like Azucar bakery, they are entitled to act on those beliefs without fear of punishment. But for citizens like Jack Phillips, the court has created a novel exception to the First Amendment — you’re entitled to believe, but not entitled to act on those beliefs. You’re not free if your beliefs are confined to your mind. What makes America unique is our freedom to peacefully live out these beliefs. We are evaluating next steps.”