A federal judge upheld yesterday the firing of Jose Gutierrez, the former head of the District government's purchasing department who was dismissed last month by Mayor Marion Barry in an acrimonious dispute over city contracts.

U.S. District Judge John H. Pratt said that because Gutierrez held a high-level, policy-making post, he "did not have any job tenure or civil service protection." The firing was "proper," Pratt ruled, declaring the mayor "could act summarily for reasons of his own."

Gutierrez had asked for reinstatement to a city government job as part of a lawsuit against Barry and the District government.

The suit sought $3 million in damages for what Gutierrez called a conspiracy to ruin his reputation. It also asked for a court order withdrawing a report by the mayor's legal counsel, Herbert O. Reid Sr., that is critical of Gutierrez.

Gutierrez charged in the suit that he was fired in retaliation for publicly accusing the mayor and other top city officials of pressuring him to approve contracts for political reasons.

In turn, Reid's report accuses Gutiterrez of steering "lucrative, giveaway contracts" and leases to a friend, Angel Roubin.

Yesterday, Pratt declined to rule on Gutierrez's conflict-of-interest complaint against Reid, saying he did not have to deal with that issue because, under law, Gutierrez served "at the pleasure of the mayor" and could be fired whenever the mayor wished.

Inez Smith Reid, the D.C. corporation counsel, whose office represents the city government, said she was "extremely pleased" with Judge Pratt's ruling, which rejected Gutierrez's request for a preliminary injunction.

"The evidence was overwhelming that the termination was proper," she continued, noting that Pratt said in his ruling that Gutierrez had "failed to establish a likelihood of prevailing on the merits" of the issue at a full trial later.

The damage claim could also come up at a trial, but Gutierrez expressed uncertainty yesterday about whether he will pursue the case any further. "I must consider a number of factors," Gutierrez said, "not the least of which is that my attorneys cost money. Marion Barry is at an advantage. All his attorneys are paid for by the District government."

Gutierrez said he is unemployed but is still collecting accumulated annual leave pay from the D.C. government.

Gutierrez, who held high-level jobs in the Barry administration since 1979, served for a year as head of the Department of Administrative Services, the city purchasing agency. In early March Barry shifted him to the less powerful post of director of the Office of Policy and Program Evaulation.

Two weeks later Gutierrez was detailed to a lower level job as special assistant to the city's planning director. He was fired from the city government on May 20.

The Gutierrez dispute also is the subject of a separate lawsuit brought by a real estate partnership headed by Roubin.

That suit seeks enforcement of leases, signed by Gutierrez signed and later canceled by the city, for office space at 1111 E Street NW. It is being heard by federal Judge Oliver Gasch.