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  REUTERS/Enrique Marcarian
  A cannabis sativa plant is seen in this file photo.

A judge recently dismissed a lawsuit that was aimed to keeping the Harborside Health Center, a medical marijuana dispensary in Oakland, Calif., open after federal prosecutors fought to shut it down.

Attorney General Eric Holder and U.S. Attorney Melinda Haag had been pushing to shutter the health center, which has been billed as the "world's largest pot dispensary," after a series of federal crackdowns forced many of California's marijuana dispensaries to close. U.S. prosecutors also claimed the health center was too large to operate and posed a safety risk.

U.S. Chief Magistrate Judge Maria-Elena James dismissed the lawsuit, filed by the City of Oakland on behalf of the health center, after James sided with prosecutor's argument that it was not being properly regulated for a center of its size. The center remains open while an appeal process proceeds.

"We are, of course, disappointed in today's ruling," Steve DeAngelo, Harborside's executive director, said in a statement the day of the ruling.

"In the meantime, Harborside will continue to provide our patients with the very best cannabis medicines we can find, in the safest and most beautiful environment we can create, with the very highest level of care and service," he added.

Records indicate that the dispensary brings in $20 million in revenue per year, which translates into over $3 million in state and local taxes. Shutting down the center would also affect more than 100,000 patients who use the facility to purchase their medically prescribed marijuana.

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This case does set a precedent- it is the first time that a local city government has sided with a marijuana dispensary over concerns of closure. It also sets the stage for future local and state governments to side with marijuana dispensers in the state. An appeals hearing is scheduled for March.

"Leaders of Oakland should be commended for standing up to the federal government's threats against the city's medical marijuana program, which creates jobs and generates tax revenue," Tom Angell, of marijuana advocate group Marijuana Majority, told The Huffington Post. "This ruling is a setback, but advocates will continue the battle."