By Jessica Dye

NEW YORK, Feb 7 (Reuters) - A federal appeals court has temporarily halted the work of a monitor overseeing New York City's implementation of a court-ordered plan to boost diversity in the city's firefighter department, according to an order Thursday.

The 2nd U.S. Circuit Court of Appeals granted the city's request for an injunctive order blocking the monitor from overseeing the city's efforts to overhaul its recruitment process for minority firefighters.

The order is the latest twist in a contentious legal battle stemming from a 2007 lawsuit filed against the city by the U.S. Justice Department. The government claimed the FDNY'S hiring practices discriminated against black and Hispanic candidates. The Vulcan Society, a fraternal organization of black firefighters, later joined the lawsuit as plaintiffs.

In a series of previous rulings, U.S. District Judge Nicholas Garaufis held that between 1999 and 2007, the department's written examination had "discriminatory effects" on minority applicants. He ordered broad changes to the FDNY's recruitment, screening and hiring practices, and appointed Mark Cohen of Cohen & Gresser to monitor the overhaul for the next 10 years.

The city appealed the injunctive relief to the 2nd Circuit.

In January, the city sought an order from the district court staying Cohen's work on the case, but it was denied by Garaufis on Jan. 31. The city appealed that decision to the 2nd Circuit, arguing in court papers that Cohen was "invading the province of the fire commissioner."

Plaintiffs countered that the monitor played an important role in ensuring the city was carrying out its legal obligations to reform the hiring processes, according to papers filed with the district court.

'NOT HEARTBROKEN'

The 2nd Circuit issued its stay without explanation in a one-line order on Thursday, and it will remain in place while the city's appeal of the remedial order is pending.

Cohen did not return a request for comment.

New York City Law Department labor and employment division chief Georgia Pestana said in a statement the city was gratified that the 2nd Circuit had granted the stay.

"This will enable the commissioner to exercise hiring discretion without the court monitor's involvement," she said.

A lawyer for the black firefighters, Richard Levy, said he was "disappointed, but not heartbroken" by the stay, since many of the remedial actions ordered by the court, including the hiring of equal-employment and recruitment experts, were already under way.

"The most important thing is this doesn't at all affect the fact that we've got the old discriminatory tests thrown out and a new test has been established," Levy said.

The U.S. Attorney's office in Brooklyn declined to comment.

To date, the monitor and his activities have cost the city $1.7 million, the city said in a statement Thursday. The city had previously sought to reduce Cohen's fee to the district court, calling it "excessive" and "astonishing." Those motions have been denied by Garaufis.

The judge ruled last year that the city could owe as much as $128.7 million in gross back pay to minority firefighter candidates who were denied jobs or had their employment with the FDNY delayed because of the racially discriminatory test.

The case is U.S. v. City of New York, 2nd U.S. Circuit Court of Appeals, No. 11-5113.

For the United States: Assistant U.S. Attorneys Elliot Schachner, Michael Goldberger and David Eskew; and Eric Bachman, Sharon Seeley, Allan Townsend, Barbara Schwabauer, Jennifer Swedish, Meredith Burrell and Varda Hussain of the Justice Department.

For the Vulcan Society: Richard Levy, Dana Lossia and Robert Stroup of Levy Ratner; Anjana Samant and Darius Charney for the Center for Constitutional Rights; and Judith Scolnick of Scott and Scott.

For New York City: Assistant Corporation Counsel Georgia Pestana, William Fraenkel, Edward Sample, James Lemonedes, Kami Barker, Kathleen Comfrey, Patricia Miller and Vivien Ranada.

Follow us on Twitter @ReutersLegal | Like us on Facebook