In the latest legal blow to the Trump administration, a federal appeals court on Monday ruled that Alina Habba is unlawfully serving as New Jersey's top prosecutor. 

A three-judge panel for the US Court of Appeals for the 3rd Circuit said in a unanimous order that a lower court correctly disqualified Habba, who previously served as Trump's personal defense lawyer. In that ruling, US District Judge Matthew Brann (Obama) said that Habba had been serving without lawful authority since the beginning of July, when she was tapped to temporarily lead the US Attorney's Office in New Jersey. Brann also disqualified her from participating in ongoing cases. 

Ahead of the 120-day deadline, the judges in New Jersey declined to allow Habba to continue serving as U.S. attorney and instead voted to install her deputy, Desiree Leigh Grace, to the position. But that decision was met with swift pushback from Attorney General Pam Bondi, who fired Grace.

Then, Mr. Trump and top administration officials employed a multi-step maneuver to keep Habba in the role of U.S. attorney and get around the district court's decision. First, the president withdrew Habba's nomination for U.S. attorney in New Jersey. Then, Habba resigned as interim U.S. attorney. Bondi then appointed Habba as "special attorney" and to fill Grace's role as first assistant U.S. attorney. Finally, because the position as the New Jersey's top prosecutor was vacant, Habba was elevated to the role of acting U.S. attorney under the Federal Vacancies Reform Act. -CBS News

The appeals court agreed with Brann, writing in their decision that the administration's argument would "effectively [permit] anyone to fill the U.S. Attorney role indefinitely," adding "this should raise a red flag" since Habba's appointment to the role was limited to 120 days unless the district court in New Jersey voted to extend her tenure, or if she was confirmed to the post by the Senate. 

"Under the Government's delegation theory, Habba may avoid the gauntlet of presidential appointment and Senate confirmation and serve as the de facto U.S. Attorney indefinitely," Judge Michael Fisher wrote for the court. "This view is so broad that it bypasses the constitutional [presidential appointment and Senate confirmation] process entirely. It also essentially eliminates the requirements of the FVRA and the U.S. Attorney-specific statute."

During a hearing in October, the judges grilled a DOJ lawyer over the unconventional way Habba was reinstated after her initial temporary appointment expired. 

The Habba decision comes on the heels of a federal judge who ordered the criminal charges against former FBI DIrector James Comey and New York AG Letitia James dismissed on the grounds that interim US attorney Lindsey Halligan was similarly unlawfully appointed to the role. 

The administration can now ask for a full panel of 3rd Circuit judges to reconsider the decision, or it can bring the case to the Supreme Court.