Construction of the stadium involves paving over large portions of two parks in the Bronx and cutting down about 400 mature oak trees. The Yankees are to offset the loss of the parks by building new parkland, including three ballfields at the site of the current Yankee Stadium, which will be dismantled.

A group of South Bronx neighbours and parks advocates filed a federal lawsuit in September protesting the loss of the parks, after first filing a suit in state court seeking a restraining order that was dismissed.

U.S. District Court Judge Naomi Reice Buchwald dismissed the second lawsuit late Wednesday based on lack of merit.

The groundbreaking ceremony for the new park, which will sit next to the site of the existing Yankee Stadium, was held in August. The 53,000-seat stadium is scheduled to open in 2009.

Telephone calls to Save Our Parks and the Bronx Council for Environmental Quality, two plaintiffs listed in the suit, were not immediately returned Thursday. The groups have the right to appeal the ruling.

Geoffrey Croft, president of New York City Parks Advocates, has said the Yankees were never required to consider practical alternatives to the taking of parkland.

The city and state will kick in more than $200 million for the stadium project. The team will pay the rest, financed through taxable and tax-exempt bonds.

The Yankees' current home was built in 1923 and renovated in the 1970s.