SAN FRANCISCO — A federal appeals court ruled against the Trump administration in its transfer of military money to build sections of the U.S. border wall with Mexico.

The ruling is the latest twist in a legal battle that has largely gone Trump's way.

The 9th Circuit Court of Appeals ruled Friday that diverting $2.5 billion from military construction projects to build the wall illegally sidesteps Congress. But the Supreme Court has already allowed the $2.5 billion to be spent while the litigation continued.

In a 2-1 decision, the appeals panel sided with a coalition of border states and environmental groups who contended the money transfer was unlawful and that building the wall would pose environmental threats.