North Carolina risks further brand backlash with 'bathroom bill' lawsuit

The state said Monday that it is filing suit against the Justice Department, accusing it of "baseless and blatant" overreach.

North Carolina filed a lawsuit against the U.S. Justice Department on Monday, defending its controversial "bathroom bill" by saying that transgender individuals are not protected under Title VII of the Civil Rights Act, the law the federal government said the bill had violated.

The lawsuit all but ensures further action on behalf of brands which had threatened to stop doing business in the state if it did not repeal or change the law, which many consider discriminatory against transgender people.

The law requires people to use the bathroom corresponding to their biological sex or gender on their birth certificate, rather than their gender identity.

More than 100 executives, including the leaders of Monster, Facebook, and Apple, signed a letter to North Carolina Governor Pat McCrory, a Republican, taking a public stance against HB2, the law in question, and urging the inclusion of transgender people.

Target recently stated that customers can use the bathroom of their choice in its North Carolina stores. The NBA has threatened to move the 2017 All-Star Game out of Charlotte if the law isn’t repealed, and PayPal cancelled an expansion in the state that would’ve created 400 jobs.

The Justice Department moved against the law last week, saying it violates federal Civil Rights law. The federal department gave McCrory until Monday to say if he would not enforce the bil or risk losing millions in federal funding.

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