A state appeals court ruled Tuesday that a judge made an error in ruling that Eau Claire's law charging pawnshops a dollar per deal was unconstitutional.
The Third District Court of Appeals said the two-year-old law did not violate the constitutional right to equality under the law.
The city has charged pawnshops a dollar per transaction since November 2003 so police can maintain a computer system that tracks customers and merchandise.
The appeals court said the city had a rational and reasonable basis for applying the law only to pawnshops because of the undue amount of stolen property recovered there.
Three Eau Claire businesses had sued the city, claiming the new law was unconstitutional and the transaction fee was an unfair tax.