A panel of the San Francisco-based 9th US Circuit Court of Appeals sided 2-1 with a gun owner in ruling that the state's prohibition against open carry in counties with more than 200,000 people violated US Constitution's Second Amendment right to keep and bear arms.
About 95 per cent of the population in California, which has had some of the nation's strictest gun-control laws, live in counties of that size.
US Circuit Judge Lawrence VanDyke, who was appointed by Republican President Donald Trump, said the Democratic-led state's law could not stand under the US Supreme Court's 2022 landmark gun rights ruling.
That decision, New York State Rifle & Pistol Association v Bruen, was issued by the court's 6-3 conservative super-majority and established a new legal test for firearms restrictions. The test said they must be "consistent with this nation's historical tradition of firearm regulation."
VanDyke, whose opinion on Friday was joined by another Trump appointee, said the latest case "unquestionably involves a historical practice - open carry - that predates ratification of the Bill of Rights in 1791."
He noted that more than 30 US states generally allow open carry.
California allowed citizens to carry handguns openly and holstered for self-defence without penalty until 2012, he said.
"The historical record makes unmistakably plain that open carry is part of this nation's history and tradition," VanDyke said.
Friday's ruling partially reversed a 2023 decision by a lower-court judge who had rejected a 2019 challenge to the law by gun owner Mark Baird.
While the appeals court largely sided with Baird, it rejected his related challenge to California's licensing requirements in counties with fewer than 200,000 residents, which may issue open-carry permits.
Senior US Circuit Judge N. Randy Smith, who was appointed by Republican former president George W. Bush, dissented, saying his colleagues "got this case half right" as all of California's restrictions complied with the Supreme Court's ruling.
Baird's lawyer had no immediate comment.
California Attorney General Rob Bonta, whose office defended the state's ban, did not respond to a request for comment.
The 2022 Supreme Court ruling has prompted court cases across the US challenging modern firearm restrictions, including in California.
A 9th Circuit panel in September 2024 upheld a California law that prohibits people with concealed-carry permits from carrying firearms at several categories of "sensitive places" like bars, parks, zoos, stadiums and museums.
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