While the actor, 57, had previously been awarded more time with the former couple's five minor children by Judge John Ouderkirk in May, that decision is now reversed after a three-judge panel disqualified Ouderkirk from the case citing a violation of "his ethical obligations," according to an opinion submitted to the court on Friday.
The Second District Court of Appeal in California sided with Jolie's argument that Ouderkirk, who had been serving as their temporary judge, could be biased in his rulings considering he had failed to disclose his business relationships with Pitt's attorneys.
A source close to the actor tells PEOPLE, "Brad believes there is overwhelming evidence that the current situation isn't good for the kids. This just sets things back for everyone."
Jolie's team is not commenting on the new opinion.
Pitt previously agreed that, if the panel found Ouderkirk disqualified, the custody arrangement between him and Jolie would revert back to the parenting plan established prior in November 2018, according to the appellate opinion.
The judges who oversaw the hearing earlier this month noted Ouderkirk's "failure to make mandatory disclosures" about other legal proceedings involving Pitt's legal counseling "might cause an objective person, aware of all of the facts" to doubt Ouderkirk's impartiality in the case, the court opinion read.
Gregg DeGuire/Getty Brad Pitt
A spokesperson for Pitt tells PEOPLE, "The appeals court ruling was based on a technical procedural issue. The facts haven't changed. There is an extraordinary amount of factual evidence which led the judge—and the many experts who testified—to reach their clear conclusion about what is in the children's best interests. We will continue to do what's necessary legally based on the detailed findings of what's best for the children."
However, the three-judge panel noted that after Pitt requested a new custody hearing in June 2020, Jolie's attorney Samantha Bley DeJean asked the judge if he was working on any new cases with Pitt's lawyers. He confirmed he was working on two new cases with them, beginning in 2019, and was still working on one case he previously thought was completed in 2018 but failed to mention was continuing.
The panel opined Ouderkirk's delay in disclosing that information was disqualifying and an "ethical breach."
"Jolie acquired this new information only because her counsel asked whether Judge Ouderkirk had any new engagements to report, not because Judge Ouderkirk had complied with his obligation under the Code of Judicial Ethics to make the disclosures," the panel wrote in its opinion. "In sum, Judge Ouderkirk's ethical breach, considered together with the information disclosed concerning his recent professional relationships with Pitt's counsel, might cause an objective person, aware of all the facts, reasonably to entertain a doubt as to the judge's ability to be impartial. Disqualification is required."
Ouderkirk's previous ruling concerned Jolie and Pitt's minor children: Pax, 17, Zahara, 16, Shiloh, 14, and twins Vivienne and Knox, 12. Maddox, 19, their eldest child, is no longer a part of the custody case.
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It was unclear if the decision was legally binding as a source told PEOPLE in May nothing had yet changed in terms of official custody.
Two days before the judge's previous ruling was made public, Jolie filed a complaint to California's Second District Court of Appeal over Ouderkirk's ruling and continuing purview over the case. Jolie previously failed to have the judge, who was also overseeing their divorce dispute, removed last November.
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In response to the previous ruling, a source close to Pitt told PEOPLE at the time the actor "has always wanted what is best for the kids, and to spend time with them."
A source close to Jolie told PEOPLE at the time that "joint custody is not the issue that Angelina objects to, there were other issues of concern, but the court proceedings are closed and sealed."
Ouderkirk presided over Pitt and Jolie's 2014 nuptials at their family's French estate, Château Miraval. He was one of only 20 attendees at the ultra-intimate affair.
Jolie filed for divorce in 2016 and she and Pitt were legally declared single in 2019 as the finalization of their divorce continues.