A federal judge is deciding a case focusing on whether the federal government or state officials have the authority to decide who is legally in the country.

U.S. District Judge David Campbell heard arguments Friday in Phoenix in a lawsuit seeking to block Arizona Gov. Jan Brewer's order denying driver's licenses for immigrants who have gotten work permits under a new Obama administration policy.

Immigrant groups say the policy is unconstitutional because Arizona allows some immigrants with work permits to get driver's license, but won't allow the immigrants protected by Obama's policy to pursue any benefits.

Brewer's lawyers claim Obama's policy isn't federal law.

The lawsuit represents the first major legal battle over President Barack Obama's policy allowing young immigrants to stay in the United States and work.