But the three-judge panel of the 2nd U.S. Circuit Court of Appeals in New York noted that the courts have long looked at the motto not so much as the entanglement of government in religion, but as a more general statement of optimism and a "reference to the country's religious heritage."
The decision in Newdow v. United States of America pleased those who have worked to protect religious expression in the public sphere. "Americans need not be forced to abandon their religious heritage simply to appease someone's animosity toward anything that references God," said Rory Gray of the Alliance Defending Freedom.
But it frustrated those who see religion creeping into places where they believe church and state should be separated. The group American Atheists, which was not a party to the suit, said the court's reasoning — based on historical acceptance of the motto — is faulty.
"Tradition is a terrible excuse for any behavior," said American Atheists spokesman David Muscato. "If we allowed 'tradition' to guide our views, what else would we uphold — slavery, denying the vote to women? The simple fact is that 'In God We Trust' has no rightful place on currency in the United States, a country with separation of church and state, and it never has."
Atheists have seen a spate of unfavorable rulings lately. Last week a federal court in Kentucky rejected atheists' suit against the IRS, for the many breaks and privileges it offers churches and religious organizations. And in the 5-4 Greece v. Galloway ruling earlier this month, the Supreme Court affirmed that government bodies may convene meeting with highly sectarian prayers.
The 2nd Circuit also questioned the atheists' objection to money that forces them "to bear on their persons … a statement that attributes to them personally a perceived falsehood that is the antithesis of the central tenant of their religious system." The atheists had reminded the court that the Religious Freedom Restoration Act requires the government to prove that it has gone to great pains to avoid so burdening religious expression.
"We respectfully disagree that appellants have identified a substantial burden upon their religious practices or beliefs," the judges responded.