Dakota Dunes based Beef Products Incorporated won a victory in court Wednesday when a federal judge moved the company's defamation lawsuit against ABC News back to state court.
BPI sued the network and some of its news staff last year for defamation over its coverage of the company's lean, finely textured beef that news reports and critics dubbed "pink slime."
BPI, which blames the coverage for a loss in sales which led to the closing of three processing plants and loss of 700 jobs, is seeking $1.2 billion in damages.
Wednesday, U.S. District Judge Karen Schreier ordered the case back to Union County Court.
Lawyers for ABC had wanted the suit heard in federal court because the parties involved are all from different states.
Associated Press contributed to this story