North Carolina Goes Head to Head with the U.S. Justice Department over Transgender Rights

The culture war over gay rights and public accommodations for transgender Americans is heading to federal court this morning.
2:26 | 05/10/16

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Transcript for North Carolina Goes Head to Head with the U.S. Justice Department over Transgender Rights
Now to the legal showdown in North Carolina over transgender rights and the use of public rest rooms. The state going head-to-head with the U.S. Justice department as they sue each other over the so-called bathroom bill. ABC's Steve osunsami is in Raleigh, North Carolina, with the latest. Good morning, steveth. Reporter: Good morning to be you, robin. State legislators who pushed for it are telling the federal government that they're holding firm. This morning, the culture war over gay rights and public accommodations for transgender Americans is heading to federal court. In her lawsuit against the state of North Carolina the U.S. Attorney general says that hb-2, the state's controversial law, is state sanctioned sex discrimination. She compares it to north Carolina's racist past saying it removes protections for gay families and keeps transgender families from legally using the bathrooms they need. This is about the dignity and the respect that we accord our fellow citizens. Reporter: In a lawsuit of his own North Carolina's governor is calling this a baseless and blatant overreach and argues that transgender residents are not a protected class up the law. The Obama administration is bypassing congress by attempting to rewrite the law and set basic rest room policies, locker room policies and even shower policies. Reporter: The federal government is still threatening to hold back federal funding for state police and the university of North Carolina. Arguing that if both obey the new state law, they're in violation of federal law and in a statement the president of the school says the university is truly caught in the middle. At the same time the list of businesses leaving the state in protest keeps growing as long with entertainer canceling concerts from pearl jam to jack Jonas and demi Lovato. They're taking the fight to stores that agreed to accommodate transgender resident. This is your warning. You will be judged. According to god's standards. Reporter: The governor maintains this state does not discriminate and something that we're learning from ABC 11, our local and owned station here in Raleigh, the governor's campaign is using the issue to raise money online to, quote, fight back against the federal government's overreach and bullying tactics from your smartphone even you can make monthly contributions. Robin. This story one of those far from being over.

This transcript has been automatically generated and may not be 100% accurate.

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