A federal appeals court on Friday ruled in favor of allowing a Santeria priest to sacrifice goats in his Texas home, saying a city's decision to prohibit the ritual violated the man's religious rights.

Jose Merced, 46, accuses the city of Euless, Texas, of trampling on his constitutional right to religious exercise. The city claims the sacrifices jeopardize public health and violate its slaughterhouse and animal cruelty ordinances.

Last year, U.S. District Judge John McBryde sided with the Fort Worth suburb and dismissed the Puerto Rico native's claims. Merced appealed.

In its ruling, the 5th U.S. Circuit Court of Appeals in New Orleans said the Euless ordinance placed a substantial burden on Merced's "free exercise of religion without advancing a compelling governmental interest using the least restrictive means."

"It's a great day for religious freedom in Texas," said Eric Rassbach, Merced's lawyer, in response to the three-judge panel's ruling.

Merced said by practicing his faith in the privacy of his own home, he didn't harm anyone.

"Now Santeros can practice their religion at home without being afraid of being fined, arrested or taken to court," Merced said.

Euless city attorney, William McKamie, said he plans to file a motion for a rehearing.

"We respectfully believe that it's an incorrect finding on the purpose of application of the Texas Religious Freedom Act," McKamie said.

In court papers, Rassbach described Santeria as an Afro-Cuban religion with a complex ritual for ordaining priests, including the sacrifice of up to nine four-legged animals, such as lambs or goats, up to 20 chickens or other fowl and a turtle.

Merced said police officers interrupted a ceremony at his home in September 2004 and told him to stop slaughtering animals. Police warned him again in May 2006 after a neighbor complained about a gathering at the house.

Merced asked the city for a permit to slaughter animals at his home but was told the practice was prohibited. He said he hasn't been able to initiate any new priests in the past three years.

Euless attorneys have said the ordinances outlawing animal sacrifices were passed before Merced's arrival in 1990 and don't discriminate against any individual or group. McKamie also said Merced isn't equipped to handle many animals on his property or dispose of them in a sanitary way.