An American court has upheld an environmental complaint that could disrupt Tesco’s $1.5 billion (£730 million) expansion plan in the US.

Riverside District Court in California yesterday said that more environmental work may be needed at a former airbase that now houses a distribution centre central to Tesco’s ambitions on the other side of the Atlantic. The distribution centre currently supplies 15 Fresh & Easy stores across Los Angeles, Phoenix and San Diego, but has the potential to cater for up to 500.

The judge ruled that the distribution centre should have been subjected to a review under the California Environmental Quality Act and that Tesco should “take all actions necessary to bring the project into compliance with that Act.”

The case, brought against the regeneration body behind the development of the Riverside area, could ultimately force Tesco to delay part of the rollout of Fresh & Easy to abide by Californian environmental legislation.

Tesco’s site already has what is widely believed to be the largest solar panel roof in America and Tim Mason, Fresh & Easy’s chief executive, has consistently talked up the venture’s green credentials. The judge may now force Tesco to undertake far more environmental monitoring at the site.

The case stems from a complaint made by Health First, a group of residents who say they are concerned about land use and environmental issues, against the property developer behind the Riverside site. It is unknown whether Health First is linked to US trade unions furious over the way Tesco has launched. None of Tesco’s Fresh & Easy staff are affiliated to a trade union and Tesco is refusing to allow union delegates into its stores to recruit potential members.

A Tesco spokesman said the group was studying the judgment before deciding on its next course of action.

In a statement, Tesco said: “The case brought against the regeneration body behind the development of the Riverside area that is home to Fresh & Easy’s distribution centre has been ongoing for some time and has not affected the development or the launch of our new stores. We will review the ruling to understand what further compliance might be necessary, but there is nothing in the ruling handed down that we believe will affect the operation or further rollout of the business.”

The distribution centre includes an 80,000 sq ft kitchen that Tesco is using to make up to 120 fresh food and ready meal products for its American stores. Tesco believes Fresh & Easy, based on its Tesco Express format, fills a gap in the American market for a neighbourhood fresh food retailer. Each store is around a fifth of the size of a typical supermarket.

Sir Terry Leahy, Tesco’s chief executive, has said that the expansion into the US could potentially transform the group’s global ambitions.

Times Recommends

• Minister in talks with Saudis to protect creditors
• Premier Inn hits back in £29-a-room row
• Bankers hit back at 'populist' bonus supertax