Lisa Broadt

lisa.broadt@tcpalm.com

Editor's note: This story has been updated from its original version. Martin and Indian River counties have allocated or spent more than $6 million in their legal fight against All Aboard Florida. The story also adds a comment from All Aboard Florida.

In a major hit to the Treasure Coast’s battle against All Aboard Florida, a federal judge on Wednesday threw out Martin and Indian River counties' lawsuits against the passenger railroad.

U.S. District Court Judge Christopher Cooper’s ruling comes after an expensive, two-year legal battle. The two counties have allocated or spent more than $6 million.

It's unclear whether the decision would affect All Aboard Florida's construction timetable: The company is to begin service between West Palm Beach and Miami this summer, but a date for expansion through the Treasure Coast and Space Coast, and on to Orlando International Airport, has been less clear.

The company on Wednesday night praised Cooper's decision.

"This is another loss in a series of lawsuits that has cost Treasure Coast residents almost $6 million," All Aboard Florida said in a news release. "We look forward to working with the Treasure Coast in a cooperative and more productive fashion as we advance this important infrastructure project.”

The counties’ lawsuits were dealt a fatal blow when All Aboard Florida late last year abandoned the financing plan at the heart of their case, according to Cooper's decision.

The Miami-to-Orlando railroad in October revealed it planned to scrap its financing plan, $1.75 billion of tax-free bonds, and instead pursue $600 million of tax-free bonds exclusively for the the first phase of the project, between Miami and West Palm Beach. The company at the time said in addition to the $600 million, it likely would request approval to sell $1.15 billion of bonds for phase two, from West Palm Beach to Orlando.

Shortly after, the railroad asked the court to dismiss the lawsuits.

“(The counties') cases are moot,” All Aboard Florida argued in documents filed in U.S. District Court in Washington, D.C. “The United States Department of Transportation has withdrawn the 2014 decision that (the counties) challenged. ... Because there is therefore no longer a live case or controversy, DOT moves to dismiss.”

MORE: Brightline environmental permit challenge shut down

For nearly two years, Indian River and Martin counties had maintained that All Aboard Florida was unlawfully issued the $1.75 billion of private-activity bonds, financing crucial to completion of the project. The counties argued that the bonds were unlawful because the Department of Transportation approved the financing before a final environmental review was completed.

Martin and Indian River counties fought back against All Aboard Florida's motion to dismiss their lawsuit, saying that the railroad's new financing plan simply was an attempt to wriggle out of the lawsuits and dodge the judicial process.

"The facts are clear — AAF is seeking to avoid judicial review of the project ... with the apparent blessing of DOT," Steven Ryan, Martin County's outside legal counsel, said in court documents. "DOT and AAF characterize this application as 'new,' but AAF is merely reshuffling its capital stack to avoid being subjected to further (environmental) review."

Cooper on Wednesday rejected that argument.

“Each case will be different,” Cooper said, adding that “predictions concerning future applications are speculative at best.”

The counties’ complaint does not challenge a “general policy,” but contests a specific bond allocation, Cooper said.

MORE: LNG, ethanol on FEC tracks pose unprecedented threat, local fire chiefs say

Many Treasure Coast government officials, activist groups and residents have been vocal opponents of All Aboard Florida since the project was announced, claiming that the increased train traffic — 16 round trips per day —would endanger public safety, the environment and the region's quality of life.

Indian River and Martin counties, as well as CARE FL, an anti-rail expansion activist group, on Wednesday characterized Cooper's decision a win.

“Although the case was dismissed by Judge Cooper ... the ruling includes a severe warning to US DOT should it issue another (public-activity bond) request for the AAF project without first complying with the nation’s environmental laws, stating ‘if DOT were to do so, plaintiffs could readily call it to the carpet by renewing their lawsuits in this court,'" CARE FL Chairman Brent Hanlon said in a statement Wednesday. “CARE FL congratulates Martin and Indian River counties for their legal efforts and considers this lawsuit a resounding win for the residents of the Treasure Coast and North Palm Beach regions."

Indian River County, meanwhile, described the decision as "a huge victory" and claimed to have made it more difficult for All Aboard to finance its project.

"The county will be following closely future developments with respect to project approvals to make certain All Aboard Florida adheres to all relevant environmental, safety and historic preservation requirements, and will take additional legal action as and to the extent warranted," Dylan Reingold, county attorney, said.

MORE: Brightline gets second train, announces limited service starting in July

Sarah Woods, Martin County attorney, in a news release painted the decision as a "success story and a hard-fought victory."

Martin County is assessing its next legal steps, according to the news release.

While the counties have been fighting in court, All Aboard Florida has been moving closer to launching the first phase of its project.

Brightline, a $3.1 billion railroad, is to begin limited service between West Palm Beach and Fort Lauderdale in July and between West Palm Beach and Miami later this summer.