updated 1/11/2008 2:26:38 PM ET 2008-01-11T19:26:38

A U.S. appeals court has overturned a $400,000 jury award to a Portuguese man who sued American Airlines Inc., claiming he was removed from a flight because of racial discrimination.

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In 2003, the 40-year-old John Cerqueira was removed from a flight from Boston to Fort Lauderdale, Florida, along with two Israeli men seated in his row. He was described as hostile by one flight attendant.

State Police later determined the three were not a security threat, but they were not allowed to re-board.

Cerqueira sued claiming flight personnel cited him as a security risk because he looked similar to the Israelis.

The U.S. Court of Appeals vacated the award to Cerqueira and criticized the federal judge for not dismissing the complaint.

Under the Air Transportation Security Act, carriers are permitted to turn away passengers who might be "inimical to safety," the panel ruled Thursday.

Because an airline captain must decide to refuse passage in an expedient manner, "even mistaken decisions are protected so long as they are not arbitrary or capricious," Circuit Judge Sandra Lynch wrote in the decision.

David Godkin, Cerqueira's attorney, told the Boston Herald he was disappointed and may appeal.

Michael Fitzhugh, American's attorney, declined comment.

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