The 30-minute hearing, before the Second Circuit Court of Appeals in New York was against an initial federal court decision which went in favor of Northrop.
The three-member appeals panel was led by Chief Judge John Walker, a cousin of President Bush.
Murray and Gould, both recipients of Walsh visas, were working in Las Vegas when they were arrested and thrown into prison on suspicion of having terrorist links in February, 2002.
Their nightmare story was first reported in the Irish Echo.
The duo’s suit against Northrop — which administered the Walsh program on behalf of the U.S. State Department — was prompted by the ultimately false accusations of terrorist links leveled at them.
They were released without charge after spending a week in jail, but then faced deportation proceedings.
However, an immigration court granted each a ‘U’ Visa, which is provided to victims or witnesses in criminal investigations.
The visa will allow Murray and Gould to remain in the U.S. until at least January.
The couple were engaged at the time their nightmare in the desert unfolded, but were married over the summer.
Their suit against Northrop seeks a jury trial, compensatory damages in excess of $1 million, and punitive or exemplary damages in excess of $100 million.
The appeal arose after two courts issued separate judgments that sharply disagreed over the onetime employment status of both Murray and Gould.
A federal judge in Brooklyn, in a summary judgment last year, ruled that Murray and Gould were not employed in Las Vegas at the time they were arrested and thrown into prison.
That judgment, delivered by U.S. District Judge Allyne Ross, accepted Northrop’s argument that Murray and Gould had been unemployed for more than 30 days at the time of their arrest and were thus outside the Walsh program.
But a Nevada immigration court separately ruled that the couple were in fact employed and were thus under the umbrella of the Walsh program, which was administered by Northrop on behalf of the U.S. State Department.
In addition to Northrop, the suit against Northrop also names Murray and Gould’s employer in Las Vegas, Steve Smith. It was accusations leveled by Smith that resulted in Murray and Gould being jailed.
The couple say they told Northrop at the time that Smith did not pay them for their work at his Las Vegas hang-gliding company.
In a separate matter, Smith was subsequently convicted in a Las Vegas court of abducting a prostitute. He was also the subject of separate investigations by law-enforcement authorities in the Nevada city.
Judge Ross, in her summary judgment, ruled that the question of damages was moot given that the court accepted Northrop’s position that Murray and Gould were not employed by Smith when arrested.
The couple’s attorney, Eamonn Dornan, filed an appeal against this decision largely on the grounds that Judge Ross had exceeded her authority by ruling on an immigration matter and that the Nevada immigration court was more qualified with regard to Murray and Gould’s status as workers in the Walsh program.
Dornan said he expected the appeals panel to take a few months to return with a decision but in the meantime Murray and Gould, who now live on Long Island, had work authorization as a result of their ‘U’ visas.