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In the latest court battle over the steamy 2004 Super Bowl halftime show, a federal appeals court ruled Wednesday that CBS should not be fined $550,000 for Janet Jackson's infamous "wardrobe malfunction."

The 3rd Circuit Court of Appeals held its ground even after the U.S. Supreme Court ordered a review in light of the high court's ruling in a related Fox television case. In that case, it said the Federal Communications Commission could threaten fines over the use of even a single curse word uttered on live TV.

But Circuit Judge Marjorie Rendell said the Fox case only "fortifies our opinion" that the FCC was wrong to fine CBS over the halftime show.

The three-judge panel reviewed three decades of FCC rulings and concluded the agency was changing its policy, without warning, by fining CBS for fleeting nudity.

"An agency may not apply a policy to penalize conduct that occurred before the policy was announced," Rendell wrote.

CBS argues that the FCC had previously applied the same decency standards to words and images — and excused fleeting instances of both.

Rendell said that long-standing policy appeared to change without notice in March 2004 — a month after the act at the Super Bowl, held in Houston.

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