Federal appeals judges said Friday that the Trump administration "exceeded its statuary authority" when it moved to indefinitely delay fines for car companies who broke an Obama-era fuel efficiency rule.

A judge for the U.S. 2nd Circuit Court of Appeals wrote that the decision by the National Highway Traffic Safety Administration (NHTSA) to delay the rule in July 2017 was "incompatible" with the law.

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"The purpose of the Act is simply incompatible with the notion of indefinite delay, given that the primary objective was to correct for decades of inaction," the court wrote in its opinion.

The New York City–based court ruled in April that the Department of Transportation's (DOT) argument that they had jurisdiction to indefinitely delay the rule while working to repeal the regulation was not legal.

The three-judge panel of the court said it would issue a fully explained opinion “in due course." That opinion was released Friday.

The judges in their opinion disagreed with the NHTSA's multiple claims that the DOT had the authority to suspend the penalties, writing: "None of these arguments persuades us."

"NHTSA offers no authority—statutory or otherwise—for the proposition that an agency has authority to delay a rule because it is engaged in a separate process of reconsideration," the judges wrote. "As the D.C. Circuit 9 recently held, a decision to reconsider a rule does not simultaneously convey authority to indefinitely delay the existing rule pending that reconsideration."

In 2015, Congress passed a law instructing federal agencies to adjust fines and penalties in order to account for inflation.

That spurred NHTSA in 2016 to increase automakers’ fines under the Corporate Average Fuel Economy (CAFE) program to $14 from $5.50 for each 0.1 mile per gallon that each car they sell exceeds the standards.

Automaker groups asked the DOT to reconsider the increases, arguing that they could cost them $1 billion.

The DOT last year agreed to review the rule and decided to indefinitely postpone it in the meantime.

The increased penalties were due to take effect for the 2019 model year, so the agency reasoned that automakers need a longer lead time to adjust to any new regulation.

However, a coalition of Attorney Generals from five states — New York, California, Vermont, Maryland, and Pennsylvania — disagreed, saying that the delay offered an unfair advantage to polluting car companies and was against the law. They filed a suit last September against the Trump administration.

New York Attorney General Barbara Underwood (D) called the judge's opinion Friday "common sense."

She also offered a warning to future challenges to environmental standards by the administration.

“As we’ve demonstrated, when the Trump administration breaks the law and puts special interests before the people they serve, we’ll take them to court — and we’ll win," Underwood said in a statement.

The decision is the latest in a string of court defeats in the Trump administration’s attempts to roll back or delay various Obama administration environmental efforts, including in methane emissions, energy efficiency and other areas.