The Minnesota Court of Appeals has put on hold a crucial permit for PolyMet's proposed copper-nickel mine amid fallout from the Minnesota Pollution Control Agency and Environmental Protection Agency departing "from typical procedures in addressing the permit."

"A substantial issue has been raised as to the regularity of the MPCA's proceedings in granting the permit," Chief Judge Edward J. Cleary wrote in the order issued Tuesday, Aug. 6. "This court has ordered the exceptional remedy of a transfer to district court to hear and determine those irregularities."

Documents released in June showed the EPA was concerned a draft of the water permit would not meet the Clean Water Act standards unless the MPCA made substantial changes, and a leaked email showed an MPCA official requested the EPA not comment on the draft permit until public comment ended.

The MPCA previously said it "wants to make (the) permitting process more transparent and clear for all parties on how and when those comments are going to be received to, again, make sure they are part of the public record."

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The EPA's office of inspector general and the Minnesota Office of the Legislative Auditor are also investigating the issue.

Environmental groups praised Tuesday's decision.

"This is amazing news," said Paula Maccabee, advocacy director and counsel for WaterLegacy. "There are huge gaps in what we know. ... This gives the environmental groups and the Fond du Lac band the time to find the truth."

Minnesota Center for Environmental Advocacy Executive Director Kathryn Hoffman said "the court has recognized the substantial evidence that PCA actively worked to conceal significant concerns by EPA scientists, who highlighted critical questions about PolyMet’s potential to pollute Minnesota’s waters."

The permit will be withheld until the issues are settled in district court. A pre-hearing conference on the "irregularities" is scheduled for Wednesday.

"We are disappointed in the court’s decision, but we remain confident that the water quality permit meets all applicable standards and will ultimately be upheld in the Court of Appeals," said PolyMet spokesman Bruce Richardson.

Jimmy Lovrien contributed to this report.