by Grant McCool and Nguyen Nhat Lam

HANOI -- Vietnamese victims of wartime "agent orange" were disappointed by a U.S. court's dismissal of a lawsuit against chemical companies but believe they have gathered more support for their cause, an official said on Saturday.

"We anticipated this because it is not easy suing big and powerful U.S. companies on U.S. soil and under the U.S. court system," said Nguyen Trong Nhan, vice chairman of the Vietnam Association for Victims of Agent Orange/Dioxin.

Friday's ruling by the U.S. Court of Appeals for the Second Circuit in New York concluded the plaintiffs could not pursue claims against Dow Chemical Co, Monsanto Co and nearly 30 other companies.

Toxins left behind from the 1960s and 70s war are a thorn in otherwise friendly ties between the Communist Party government and Washington which have been built up around trade and business since 1995.

The lawsuit contended agent orange caused ailments, including birth defects and cancer.

Studies have shown the compound of dioxin, a component of "agent orange" herbicides sprayed during the war, is still present in so-called "hot spots" at levels hundreds of times higher than would be accepted elsewhere.

The United States has maintained there is no scientifically proved link between the wartime spraying and the claims of dioxin poisoning by more than 3 million people in Vietnam.

The U.S. government, which claimed sovereign immunity, was not sued.

Nhan, a former health minister, said "outside court we have been telling the international community, including American people and they have shown their support for our cause.

"We have more and more supporters all the time," said Nhan, who spoke in his personal capacity. He said the victims' group would make a statement on Monday.

Another Vietnamese official, scientist and dioxin expert, Le Ke Son, said, "I believe the victims group will take this to the U.S. Supreme Court", which would be the next stage of appeal.

Efforts by the Vietnam and U.S. governments and non-governmental organisations have made progress in recent months toward cleaning up dioxin from an area of a former U.S. military airbase in the central city of Danang .

Reporting by Grant McCool and Nguyen Nhat Lam; Editing by Jerry Norton
© Reuters 2008