By a 2-1 vote, a panel of the 9th U.S. Circuit Court of Appeals rejected Google's assertion that the removal of the film "Innocence of Muslims" amounted to a prior restraint of speech that violated the U.S. Constitution.
The plaintiff, Cindy Lee Garcia, had objected to the film after learning that it incorporated a clip she had made for a different movie, which had been partially dubbed and in which she appeared to be asking an offensive question about Islam's prophet.
In a statement, Google said: "We strongly disagree with this ruling and will fight it."
Cris Armenta, a lawyer for Garcia, said she is delighted with the decision.
"Ordering YouTube and Google to take down the film was the right thing to do," Armenta said in an email. "The propaganda film differs so radically from anything that Ms. Garcia could have imagined when the director told her that she was being cast in the innocent adventure film."
For many Muslims, any depiction of the prophet is considered blasphemous.
Google had refused to remove the film from YouTube, despite pressure from the White House and others, though it blocked the trailer in Egypt, Libya and certain other countries.
Source: World Bulletin