KANSAS CITY, Missouri (Reuters) - A Supreme Court ruling in a case pitting environmentalists against biotech seed giant Monsanto Co could speed up a resumption of sales of genetically altered alfalfa, though any commercialization still depends on action by U.S. regulators.

The Supreme Court said in a 7-to-1 vote on Monday that a district court judge in San Francisco had abused his discretion in barring the U.S. Agriculture Department from effecting a partial deregulation and in prohibiting the planting of the biotech alfalfa seeds, pending the completion of an environmental review.

The ruling, however, does not alter the lower court decision that vacated the U.S. Department of Agriculture’s approval of genetically altered alfalfa until completion of a full environmental review. That review is pending.

The Supreme Court said USDA could allow a partial deregulation in the meantime.

USDA indicated at the Supreme Court argument in April that full deregulation is about a year away.

“USDA is moving forward with the completion of the environmental impact statement on the deregulation of Roundup Ready Alfalfa and nothing in the Supreme Court’s decision affects that ongoing process,” USDA spokesman Caleb Weaver said.

But Monsanto attorney Dave Snively said Monday the company would work to “accelerate” USDA action to allow for expanded alfalfa plantings even before the full environmental review is completed.

He said the company viewed the ruling as “far reaching” and helping define the reach of the U.S. regulatory framework for biotech crops, making it more difficult for opponents to obtain injunctions against certain crop.

Monsanto is also currently fighting a lawsuit challenging the regulatory approval of its biotech sugar beets, and Snively said this ruling could impact that case.

Andrew Kimbrell, a lawyer for the Center for Food Safety, one of the plaintiffs in the case, said biotech alfalfa opponents were heartened that the ban on sales and planting of the crop remained in place, at least until USDA’s environmental review is completed.

“The bottom line is the bottom line. The ban on the sale and planting of alfalfa remains in place,” Kimbrell said.

FOUR-YEAR LEGAL BATTLE

Environmental groups and conventional seed companies, led by Geertson Seed Farms, sued the USDA in 2006 to force it to rescind its approval of the Monsanto alfalfa seed until USDA conducted a full environmental study.

The groups claimed that the biotech alfalfa could be destructive to both the economy and the environment.

U.S. District Judge Charles Breyer of the Northern District of California vacated the USDA’s 2005 approval of biotech alfalfa, saying USDA’s approval was illegal and did not follow a full environmental review.

Breyer issued an injunction against the planting of biotech alfalfa, marking the first time a federal court had overturned a USDA approval of a biotech seed.

His decision was upheld by a U.S. appeals court.

Prior to the injunction, Roundup Ready alfalfa was planted by approximately 5,500 growers across more than 220,000 acres, according to Monsanto.

St. Louis-based Monsanto intervened on the government’s side in the case and appealed to the Supreme Court.

Specifically, the Supreme Court ruling on Monday said that Breyer had erred in entering the nationwide injunction against planting the seeds and also that the lower court had overstepped its bounds in prohibiting the USDA’s Animal and Plant Health Inspection Service (APHIS) from pursuing a limited deregulation as it completes its environmental review.

“We do not know whether and to what extent APHIS would seek to effect a limited deregulation during the pendency of the EIS (environmental impact statement) process if it were free to do so; we do know that the vacatur of APHIS’s deregulation decision means that virtually no RRA (Roundup Ready Alfalfa) can be grown or sold until such time as a new deregulation decision is in place,” the ruling stated.

Alfalfa is the fourth-largest U.S. field crop grown on about 23 million acres in the United States annually, Monsanto says.

The Supreme Court case is Monsanto v. Geertson Seed Farms, No. 09-475.