Michael Untermeyer, Esq., of Philadelphia, was appointed shortly after the decision was made to fill the role of special prosecutor, according to Attorney General Michelle Henry.
A divided 4-3 Commonwealth Court turned down Krasner's argument that the law passed late last year by Republicans in the General Assembly, along with dozens of Democratic votes, violates the state Constitution.
"This is a very big deal," said Krasner, who called the law a "profound threat to democracy."
Krasner, a Democrat, sued over the law in January, arguing it unconstitutionally stripped him of geographic jurisdiction and removed his core prosecutorial functions and other grounds.
"This law is extremely selective. Only in Philadelphia does this law say that an unelected prosecutor can take away your cases and take away your power," Krasner said.
"This is a case that was always headed to the Pennsylvania Supreme Court," he added.
The law gives Untermeyer, the new special prosecutor, the ability to take over crimes "within" SEPTA.
When that occurs, the district attorney is required to suspend investigations and proceedings and turn over the files to Untermeyer.
Untermeyer most recently worked as an attorney in private practice, officials say. He also has 15 years of experience as a prosecutor.
The law was passed amid concerns by some about crime in Philadelphia and their belief that Krasner's progressive policies have made the situation worse.
Krasner argues he's prosecuted the vast majority of crimes that come to his office from SEPTA. Democratic Gov. Josh Shapiro signed the law.
"This has nothing to do with public safety. It never did. This has to do with the disenfranchisement of Philadelphia voters," Krasner said.
Krasner mentioned recent statistics that appear to show a drop in crime, including on mass transit, noting that Philadelphia is leading the way.
WATCH | Philadelphia DA discusses Pa. court decision to uphold law establishing special prosecutor for SEPTA crimes
Philadelphia DA discusses Pa. court upholding law establishing special prosecutor for SEPTA crimes
In a dissent, Judge Christine Fizzano Cannon said the law improperly delegates the General Assembly's legislative authority, allowing the special prosecutor to decide what "within" means regarding SEPTA.
She said that was too vague and a fatal defect in the law. Cannon and two other judges said they would have thrown out the law.
"SEPTA is an agency. It is an entity. It is not a specific place or a tangible thing. The meaning of 'within' in relation to SEPTA conveys no concrete impression to the ordinary person; it is simply incomprehensible," Fizanno Cannon wrote.
She argued the law also violates the due process rights of criminal defendants by preventing them from challenging the special prosecutor's authority.
AG Henry's office told the court last week it was about to make a firm job offer to a candidate for special prosecutor, the majority opinion noted.
The law gave the state attorney general 30 days to appoint Untermeyer, who has not worked for that office or Krasner's in the past six years.
The prosecutor's costs would be reimbursed by the city, and the attorney general's office would foot the bill for a per diem salary, equal to the pay of a district attorney.
The SEPTA prosecution jurisdiction bill's primary sponsor, Sen. Wayne Langerholc, a Republican from Cambria County, has said he envisioned the special prosecutor as picking and choosing which crimes to pursue, leaving the rest to Krasner. The law is set to expire along with the end of Krasner's second term in December 2026.
Krasner also is awaiting a Supreme Court decision about whether the state Senate can proceed with a trial regarding whether to remove Krasner from office. Republicans who controlled the House last session voted to impeach Krasner, but the trial in the GOP-majority Senate is on hold while the high court weighs the matter.
"With today's Commonwealth Court ruling upholding Act 40, seven months after becoming law this collaborative effort will finally begin to make a difference with a special prosecutor to oversee crimes occurring on SEPTA within the City of Philadelphia," Pennsylvania Senate Majority Leader Joe Pittman (R) said regarding the ruling.
The Associated Press contributed to this report.