Sessions’ move may signal end to H.B. 2 lawsuits

As attorney general, Roy Cooper refused to defend North Carolina in a lawsuit challenging House Bill 2. He used the so-called bathroom law passed by the General Assembly as a rhetorical weapon in his successful campaign against incumbent Republican Gov. Pat McCrory.

As governor, Cooper may soon find the legal tables turned on him.

U.S. Attorney General Jeff Sessions has backed away from pursuing a Texas lawsuit involving the issues of transgender rights surrounding the H.B. 2 controversy. The move prompted Campbell University law professor Greg Wallace to project that Sessions might abandon the Obama administration’s transgender bathroom lawsuit against North Carolina. If so, a separate sex-discrimination lawsuit against the University of North Carolina may fail as well.

On Friday, Sessions’ Justice Department, along with 13 states that last fall sued the Obama administration over a civil-rights dispute involving transgender persons, asked the 5th U.S. Circuit Court of Appeals to cancel oral arguments. The request came immediately after the new attorney general withdrew a motion from the Obama DOJ last year limiting the scope of the lawsuit.

Wallace said Sessions’ moves may be the first step toward repealing the Obama administration’s interpretation of Title IX of the Civil Rights Act. Title IX prohibits sex-based discrimination in federally funded educational programs. Obama’s Department of Education claimed sex is not restricted by biology but includes an undefined “gender identity,” and DOJ went along.

DOJ then sued North Carolina and is involved in litigation elsewhere after the Education Department issued a directive forcing school districts and universities to open bathrooms, changing facilities, and showers to transgender students.

A separate lawsuit filed by the ACLU and others targeted the UNC system, saying the Equal Employment Opportunity Commission ruled that H.B. 2 also violated federal Title VII, which bans sex discrimination in the workplace.

“Even if there are those in the Trump administration that are sensitive to transgender rights, the way the Justice Department and the Department of Education under Obama went about doing this was so contrary to the rule of law that I just don’t expect Attorney General Sessions to continue the policy the way it was,” Wallace said.

If the policy is changed, “it means that the federal lawsuits against North Carolina will go away because they are moot,” Wallace said.

The EEOC hasn’t changed its position, and the individual plaintiffs could still move forward with their lawsuit, claiming their constitutional rights were violated.

“I think they have the slimmest chance of prevailing on that argument,” Wallace said.

The federal lawsuits argued that courts should allow Obama’s executive branch agencies to interpret the definition of sex under Title IX, even though Congress never has included gender identity as a part of civil-rights protections. Wallace does not expect either Sessions or Education Secretary Betsy DeVos to preserve the Obama administration’s insistence that sex includes gender identity.

“When Title IX was passed in 1970 nobody thought that that sex meant gender identity,” Wallace said. In its use of agency rulings rather than legislation to reinterpret the law, Wallace said, the Obama administration was “trying to do an end run around the rule of law.”

In ruling on a preliminary injunction in the North Carolina case brought by the ACLU, U.S. District Judge Thomas Schroeder ruled “the plaintiffs were not likely to succeed on the merits of their constitutional claims,” Wallace said.

Wallace added that it probably would be difficult to convince Schroeder that Title IX is about gender identity and not anatomical sex.

“In this context, with respect to transgender persons and bathrooms, I don’t know of any court that’s ever interpreted it that way,” he said. “So for all intents and purposes, this is going to nullify these lawsuits in North Carolina” if the Trump administration abandons the Obama-era interpretations of Title IX, Wallace said.

Meanwhile, Athlete Ally, an LGBT advocacy organization, released an open letter Monday from athletes at Duke University, UNC-Chapel Hill, N.C. State University, and Wake Forest University criticizing H.B. 2. It was not clear how many students signed on.

“In the past 10 months, North Carolina has seen revenue flee the state in the form of billions of dollars in federal funding, employers halting expansion plans, entertainers, artists, and athletic organizations cancelling events, and countless losses of potential jobs, ticket sales, and tax revenues,” the letter said.

“On Monday, the reality of H.B. 2’s unsustainability grew even clearer with the NCAA’s announcement that unless lawmakers repeal the bill by the end of February, North Carolina will forfeit its eligibility to host championship events in the state through 2022,” the letter said.

Economic boycotts are nothing new. They were common in the 1950s and 1960s Civil Rights era, said Donald Boudreaux, an economist at the Mercatus Center at George Mason University.

Boudreaux said orchestrated moves against H.B. 2 — including tournament boycotts by the ACC and the NCAA; relocation of the NBA All-Star Game from Charlotte; decisions by businesses to move conventions or corporate expansions outside North Carolina; and state government travel boycotts of North Carolina — could have unintended consequences.

“I can see them actually creating some backlash, particularly on moral issues like that,” he said. “People don’t like to be bullied, especially if they think the bullying is coming from distant places. Then they just dig in their heels even more tightly.”

Boudreaux says government shouldn’t be mandating things such as transgender bathrooms.

“When private businesses are left to be free to do these kinds of things, then you don’t have one-size-fits-all,” he said, noting that private-sector operators come up with a variety of facility arrangements meant to satisfy their customers.

Moreover, Boudreaux said, economic impact estimates about losses due to H.B. 2 can’t be trusted because they assume that businesses won’t try to offset revenues lost from cancellations or boycotts.

If an event cancels, hotels will look for other events and room bookings to replace it, Boudreaux said. “So there is a counter effect to the boycott.”