"The town had an obligation to consider how its prayer practice would be perceived by those who attended town board meetings," Judge Guido Calabresi wrote for the court.
The town contends the "endorsement test" — a standard created by now-retired Supreme Court Justice Sandra Day O'Connor — doesn't apply to legislative-prayer cases.
Such a test "requires courts to parse prayers' content and thus inevitably forces courts to play the role of theologian, making judgments about the prayers' validity based on the supposed religious effect they are likely to have on observers," the town argued in court papers.
Greece says the 1983 Supreme Court decision, Marsh v. Chambers, permits legislative prayers as long as the government doesn't discriminate in selecting the person or use the practice to proselytize or disparage a faith.
The town has the backing of Robert Palmer, a Presbyterian minister whose prayers before the Nebraska state legislature were at issue in the 1983 case. In court papers, he said his prayers were "more identifiably Christian" than those in Greece.
"It's clear that the Constitution allows the government to open its meetings by invoking divine guidance," said Harvey, the lawyer for the town. "And once you do that, you need to let people pray consistent with the dictates of their own conscience."