By Ayla Jean Yackley

ISTANBUL (Reuters) - A U.S. judge threw out a lawsuit against a prominent Muslim cleric and opponent of Turkish President Tayyip Erdogan, saying the court lacked jurisdiction, lawyers for both sides said.

Fethullah Gulen, once Erdogan's ally but now branded by the president as a "terrorist", was accused in the lawsuit of ordering his followers in the Turkish police and judiciary to arrest members of another Islamic movement in 2009.

Gulen lives in self-imposed exile in Saylorsburg, Penn.

The district court in nearby Scranton on Wednesday ruled the suit against Gulen for alleged wrongdoing in Turkey could not be brought in the United States, said Robert Amsterdam, founder of UK-based firm Amsterdam and Partners LLP, who represented the plaintiffs.

"We were attempting to bring him before a U.S. court in respect to his actions in Turkey," Amsterdam told Reuters on Thursday. "The court has ruled that, given the law in this area, the United States doesn't have jurisdiction."

An official at the Scranton court confirmed that the lawsuit, filed in December, had been dismissed.

"This decision brings to an appropriate end a lawsuit that should never have been filed," Michael Miller, a lawyer for Gulen, said in a statement. "The case was a politically motivated attack leveled by (Erdogan) against Mr. Gulen for doing nothing more than publicly accusing the Erdogan administration of being corrupt and authoritarian."

The Turkish government, though it hired Amsterdam, was not named as one of the plaintiffs in the civil suit.

Erdogan accuses Gulen of building a "parallel structure" within the police and judiciary to topple him. The state has seized newspapers, banks and other companies affiliated with Gulen's movement. Gulen denies any wrongdoing.

In Turkey, Gulen still faces charges of plotting against a rival religious group by fabricating evidence and charges, as well as trying to overthrow Erdogan.

The Turkish leader and Gulen publicly fell out after police and prosecutors viewed by Erdogan as sympathetic to the cleric opened a corruption probe in 2013 that touched his inner circle.

Amsterdam said he would pursue separate complaints filed in Texas and California against Gulen for alleged "fiscal abuse" at the 120 U.S. charter schools his followers run.

"In respect to Gulen's activities in the United States, (the ruling) has no relevance at all," he said. "We are waiting for the U.S. regulatory authorities in those states to get back to us. We are expecting reactions in the next few months."

(Editing by Gareth Jones and Dominic Evans)