In a two-sentence court filing the Justice Department said it had dropped its lawsuit, filed last year by the Obama administration, because the North Carolina legislature had replaced it with a new law called House Bill 142.
The filing marks the first significant move in a complicated legal battle challenging the state's nondiscrimination laws since the replacement of the original law, known as House Bill 2 or more commonly as the "bathroom bill."
House Bill 2's most controversial provision was the requirement that in state-run buildings transgender people use the bathrooms, changing rooms and showers that corresponded to the sex on their birth certificates rather than their gender identity.
A number of businesses and sports leagues boycotted North Carolina because they saw the year-old law as discriminatory against the lesbian, gay, bisexual, and transgender (LGBT) community. Civil liberties groups also protested the move.
The American Civil Liberties Union, the ACLU of North Carolina, and Lambda Legal filed a lawsuit challenging the law in March of last year. That was followed in May by the Justice Department's own suit against House Bill 2.
House Bill 142 "leaves transgender people in limbo and that's intentional," Esseks said. "This does not fix the problem. It creates confusion."
Esseks said his group planned to amend their lawsuit soon to challenge the new bill.
(Reporting by Nathan Layne in New York, Editing by Dan Grebler and Chizu Nomiyama)
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