PHOENIX (AP) — A federal judge on Thursday upheld an Arizona law that prohibits businesses from knowingly hiring illegal immigrants and yanks the businesses licenses of those that do.

U.S. District Judge Neil Wake’s 37-page ruling was a defeat to employers who argued it’s an unconstitutional attempt by a state to regulate immigration.

The ruling, which dismissed the challengers’ lawsuit, was a victory for advocates for tougher immigration enforcement who reject the long-standing notion that immigration enforcement was solely a federal responsibility.

Wake rejected arguments by business groups that federal immigration law severely restricts Arizona’s ability to punish people who knowingly employ illegal immigrants.

Under the law, businesses that knowingly hire illegal immigrants could face a business license suspension lasting up to 10 days. Second-time violators would have their business licenses permanently revoked.

The judge concluded the Arizona law doesn’t conflict with federal immigration law, which he said specifically lets states regulate business licensing.

“Preservation of that state power was itself part of Congress’ careful balancing of policy objectives,” Wake wrote.

Wake also ruled that the law gives sufficient due-process protections to businesses.

Also, its requirement that employers use an otherwise voluntary federal database to verify the employment eligibility of new workers was not overly burdensome on employers, he said.

Startup and operational costs are low and there’s “no evidence that Congress intended to protect employers from state laws that impose such incremental costs,” he said.

Wake’s ruling did not settle recent debate over whether the law applies only to workers hired after the law took effect in January, not all employees who were previously on the payroll.

He noted that the law’s reach has been debated, with lawmakers disagreeing on what was intended, and said that issue would have to be settled in a future case.

The business groups challenging the law said they will appeal Wake’s ruling to the San Franscisco-based 9th U.S. Circuit Court of Appeals “within a matter of days.”

“We look forward to this next phase and remain optimistic that our case is strong and will ultimately prevail,” the challengers said in a statement.

They said their appeal will include a request for an emergency order blocking enforcement of the law. It took effect Jan. 1 but prosecutors have told Wake they wouldn’t take any complaints to court until March 1, allowing time for an appeal.

Arizona Attorney General Terry Goddard, whose office is defending the law in court, called Wake’s ruling a “thoughtful review.”

The prosecutor for Arizona’s most populous county, which includes the Phoenix area, also hailed the ruling.

“This law represents a good-faith effort to deal with the immigration crisis by focusing on those relatively few employers who intentionally or knowingly hire illegal immigrants,” said Maricopa County Attorney Andrew Thomas.

The law won approval last year from the Republican-majority Legislature and Democratic Gov. Janet Napolitano amid frustration over what they said were inadequate federal efforts to confront illegal immigration.

It was intended to weaken the economic incentive for immigrants to sneak across the border and lessen Arizona’s role as the busiest illegal gateway into the country. The Pew Hispanic Center estimates that illegal immigrants account for one in 10 workers in the Arizona economy.

Wake’s ruling came six months after a federal judge in Pennsylvania made a decision that dealt a blow to the movement to get state and local governments to crack down on illegal immigration.

In the Pennsylvania case, the judge had voided a city law that sought to punish those who hire or rent to people in the country illegally, ruling the restrictions were pre-empted by federal law.

Neither the ruling in the Pennsylvania case nor Wake’s ruling are binding legal precedents on other courts.

Opponents of the Arizona law argued it would burden employers, poison Arizona’s business climate and that cracking down on such hirings is the sole responsibility of the federal government.

Supporters said state punishments were needed because the federal government hasn’t adequately enforced a federal law that already prohibits employers from knowingly hiring illegal immigrants.

Attorneys for the state had said the groups weren’t reading the law correctly and that the new state law doesn’t conflict with federal law.

On the Net:

Arizona Employers For Immigration Reform: http://azeir.org/index2.asp

Arizona Legislature: www.azleg.state.az.us/

Arizona Attorney General’s Office: www.azag.gov/