The orders, enacted in the capital during various states of emergency, included shortened operating hours and a ban on alcohol sales, though there was a compensating government subsidy. Businesses that didn't comply were subject to fines.

Global-Dining Inc, which runs more than 40 restaurants, defied the restrictions, taking the city government to court over the matter.

The district court said the Tokyo government had not provided a "rational explanation" for the measures. The court determined they had been illegal but it denied Global-Dining's claim for 104 yen ($0.80) in damages.

The restrictions ended in March. Whether this ruling would inhibit the city government in acting against any renewed COVID-19 outbreak is unclear.

In a statement, Global-Dining president Kozo Hasegawa, said the case revealed the "injustice and sloppiness of the Tokyo Metropolitan Government." His company crowd-funded more than 25 million yen to fight the case.

Global-Dining's Gonpachi restaurant, with a cavernous inner courtyard, inspired the fight scene in Quentin Tarantino's first "Kill Bill" film. It was the site of a dinner between then Prime Minister Junichiro Koizumi and then U.S. President George W. Bush in 2002.

($1 = 129.3600 yen)

(Reporting by Rocky Swift in Tokyo; Editing by Bradley Perrett)

By Rocky Swift