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Update 3/7: The FAA has appealed. 

From Motherboard:

For the moment, commercial drones are, unequivocally, legal in American skies after a federal judge has ruled that the Federal Aviation Administration has not made any legally binding rules against it.

The judge dismissed the FAA’s case against Raphael Pirker, the first (and only) person the agency has tried to fine for flying a drone commercially. The agency has repeatedly claimed that flying a drone for commercial purposes is illegal and has said that there’s “no gray area” in the law. The latter now appears to be true, but it hasn’t gone the way the FAA would have hoped. Patrick Geraghty, a judge with the National Transportation Safety Board, ruled that there are no laws against flying a drone commercially.

The FAA attempted to fine the 29-year-old Pirker $10,000 after he used a drone to film a commercial at the University of Virginia. Pirker and his lawyer, Brendan Schulman, fought the case, saying that the FAA has never regulated model aircraft and that it’s entire basis for making them “illegal,” a 2007 policy notice, was not legally binding. The FAA has never undertaken the required public notice necessary to make an official regulation.

Geraghty agreed: The FAA “has not issued an enforceable Federal Acquisition Regulation regulatory rule governing model aircraft operation; has historically exempted model aircraft from the statutory FAR definitions of ‘aircraft’ by relegating model aircraft operations to voluntary compliance with the guidance expressed in [the 2007 policy notice], Respondent’s model aircraft operation was not subject to FAR regulation and enforcement.”