There’s news from social analytics service PeopleBroswr in its legal battle against Twitter’s efforts to cut its direct access to its data stream. The company just announced that a federal court decision has ruled it does not have jurisdictional over the case, and has instead passed it back to a State Court in San Francisco.

PeopleBrowsr is claiming a victory here, arguing that it has been awarded the cost of its legal fees and retained access to the Twitter firehose; but this decision is not a major win, since it defers the case to state-level where it will be heard out all over again. Twitter had tried to move the case into a Federal Court in order to end PeopleBrowsr’s temporary access to its fire hose, but it was not successful so there a small triumph for the company here.

“The Court agreed with PeopleBrowsr that the complaint relies solely on state law and that it does not have federal jurisdiction over the case,” an announcement from PeopleBrowsr says.

A Twitter spokesperson dismissed the case, providing TNW with the following statement: “We believe this case is without merit and will vigorously defend ourselves against it.”

PeopleBrowsr, a social analytics service for marketers and parent company to social influence service Kred, sued Twitter last year alleging that it had unfairly lost access to the Twitter firehose. The lawsuit claimed that Twitter receives more than $1 million per year from PeopleBrowsr for access based on an agreement the companies had in June 2010. The company argued that any denial of access to the Twitter data stream could “devastate [PeopleBrowsr’s] business”.

Twitter tried to remedy the situation by offering access to the data stream via its official resellers — Gnip or Datasift — since it preferred not to renew its ‘direct-to-user’ agreement. But, rather than turning things over to resellers, PeopleBrowsr rejected that approach.

The analytics firm won a restraining order, and temporary access to the Twitter firehose in November 2012 and now, following this latest decision, the company will take its case back to state-level.

Here is what PeopleBrowsr is saying about today’s ruling.

PeopleBrowsr wins against Twitter: Case returns to State Court

The Court agreed with PeopleBrowsr that the complaint relies solely on state law and that it does not have federal jurisdiction over the case.

The Court noted that “The fact that the removal shortly followed the state court’s issuance of a TRO suggests that Twitter’s decision to remove the case was born out of a desire to find a more sympathetic forum.” The court rejected Twitter’s arguments as “novel”: “Twitter’s removal lacked an objectively reasonable basis for seeking removal. It was based on a novel legal theory…”

Costs awarded to PeopleBrowsr

The Court also granted PeopleBrowsr’s request to pay for reasonable costs and expenses, including attorneys fees, incurred as a result of Twitter’s improper removal of this case.

The next step now is discovery, followed by a state court preliminary injunction hearing. In the meantime, PeopleBrowsr’s temporary restraining order against Twitter will remain in place and PeopleBrowsr continues to have full access to the Firehose.

Here are the court docs:

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