East Haven officials had challenged a judge's order that a new trial be held to determine compensatory damages in the shooting death of Malik Jones.
The case involves Emma Jones, who is seeking a new trial on compensatory damages against the town for the 1997 shooting of her son.
A federal jury in Hartford did not award any compensatory damages to Jones in a 2003 verdict. The jury did approve $2.5 million in punitive damages, but a federal judge threw out the award.
However, the same judge ordered a new trial on compensatory damages, which the town appealed.