A federal judge in North Carolina approved a settlement on Tuesday that prohibits the state government from banning transgender people from using bathrooms in state buildings that match their gender identity, ending a yearslong legal battle that prompted a divisive cultural debate.
The settlement, proposed by civil rights groups and Gov. Roy Cooper, a Democrat, could also end a lawsuit challenging the constitutionality of two bathroom bills that thrust North Carolina into the epicenter of the nation’s culture wars over protections for L.G.B.T. people.
The settlement concerns the use of bathrooms in public buildings like state offices and highway rest stops. Left unresolved, however, was a part of the lawsuit challenging a moratorium on local anti-discrimination ordinances.
“It feels like a consolation prize,” said Joaquin Carcano, a transgender man and the lead plaintiff in the case. “Legally we can’t be punished under these laws, but this resolution doesn’t provide safety or piece of mind when we can still be fired for being who we are.”
North Carolina’s House Bill 2, which the Republican-controlled Legislature passed in March 2016, required transgender people in government and public buildings to use the bathroom that corresponds with the gender on their birth certificate. It also made it illegal for municipalities to adopt anti-discrimination policies intended to protect L.G.B.T. people.
The law drew nationwide outrage and unleashed severe economic consequences for North Carolina. Companies like PayPal canceled planned expansions in the state and the N.B.A. and N.C.A.A. moved events elsewhere. Facing the loss of billions of dollars, the state passed a law in 2017 that repealed House Bill 2, but maintained the state government’s control over transgender bathroom access and halted local anti-discrimination rules until the end of 2020.
The compromise, House Bill 142, satisfied neither side of the debate, with gay rights groups saying that it was barely a repeal and that it failed to explicitly protect bathroom usage by transgender people, while conservatives complained it backtracked on traditional values.
According to the settlement, North Carolina is permanently barred from using current state law to “prevent transgender people from lawfully using public facilities in accordance with their gender identity” in state government buildings.
The part of the case relating to limits on local anti-discrimination laws is on hold until the United States Supreme Court addresses the question of whether a federal ban on sex discrimination includes gay and transgender people.
“The mark of H.B. 2 remains,” said Chase Strangio, a staff attorney with the A.C.L.U.’s Lesbian, Gay, Bisexual, Transgender and H.I.V. Project, which is involved in the case. “It’s not a full win. But it’s still a huge win for a community that has faced so much discrimination.”