The state Supreme Court yesterday handed the city a victory in its long-running battle to seize an adult theater that has stalled a North Side redevelopment project.

The court ruled that the city's Urban Redevelopment Authority did not violate the free-speech rights of Garden Theatre Realty Corp. when it sought to seize the theater property on West North Avenue by eminent domain nearly 10 years ago.

"I don't yet know what it means to the URA except that it sounds like completely good news," said Donald Kortlandt, general counsel to the URA, who had not reviewed the ruling yesterday. "It does confirm that the URA has been vindicated and did not abuse its power."

"It's all good," said Mark Fatla, executive director of the Northside Leadership Conference. "Because it decided a federal constitutional question, there's still a possibility of an appeal to the U.S. Supreme Court. But it's pretty clear that at each level of review the court has upheld the URA's position and the community's redevelopment efforts."

The decision, affirming a Commonwealth Court decision, comes 17 years after the first effort to declare the Federal North corridor blighted and thus eligible for redevelopment. The adult movie house has been the sole holdout, and the Supreme Court decision has been awaited in the neighborhood for years.

The Garden Theatre itself is not a party in the case; the realty company, its landlord, is. George Androtsakis, owner of the building, who has resisted the URA's efforts and who took the First Amendment position on behalf of the theater, could not be reached last night.

From 1995 to 1997, the URA acquired 46 properties as part of a redevelopment effort in the works for 14 years.

Joan Kimmel, longtime member of the Central Northside Neighborhood Council, said the long legal battle "has been horrible for the neighborhood.

"We've watched buildings almost fall down, deteriorate, catch fire. The city has had to invest thousands and thousands to rebuild a wall because of our commitment to keep these buildings intact. Meanwhile, the rest of the area has stayed depressed. The few store owners who have managed to stick it out have been a small island in a sea of decay. Now, interest is beginning to percolate."

That activity, which includes new housing on Federal Street and the Carnegie Library system's interest in building a new branch on Federal, makes the timing of the court ruling sweet, Mr. Fatla said.

He said the neighborhood has been working on improvements to the Federal-North corridor, "not just this site but the entire corridor, for nearly 20 years. The owners of the Garden have resisted for a decade.

"Fortunately, community groups have the attitude that all things will happen in time if we just stay at it, stay dogged and unrelenting."