A federal judge threw out a key class-action lawsuit Wednesday against the U.S. Army Corps of Engineers over flooding from a levee breach after Hurricane Katrina.

U.S. District Judge Stanwood Duval ruled that the Corps should be held immune over the failure of a wall on the 17th Street Canal that caused much of the flooding of New Orleans in August 2005.

The suit led to 350,000 separate claims by businesses, government entities and residents, totaling billions of dollars in damages against the agency.

The fate of many of those claims was pinned to that lawsuit and a similar one filed over flooding from a navigation channel in St. Bernard Parish. It was unclear how many claims could still move forward.

The ruling relies on the Flood Control Act of 1928, which made the federal government immune when flood control projects like levees break.

Throughout the court proceedings, plaintiffs lawyers knew they faced a daunting task because the canals were, over time, used as flood control projects by the Corps.

"I knew we had an uphill battle. But we had to do it," plaintiffs lawyer Joseph Bruno said. "It's an outrage. Read the opinion: The judge reads through all the negligence by the Corps, but says he had to rule the way he had to."

Bruno said the plaintiffs would appeal to the 5th U.S. Circuit Court of Appeals, but he conceded that overturning Duval's ruling would be difficult.