The legal fight over the state's controversial bathroom bill is not over.
A federal judge is allowing part of a lawsuit challenging the measure that replaced HB2 to continue.
The ruling comes more than three months after a group of plaintiffs made their case in a Winston-Salem federal courtroom as Republican legislative leaders asked for the lawsuit to be dismissed.
Among the arguments against the law was that it's discriminatory because it creates confusion over whether transgender people could be punished for using the bathroom of their choice.
Judge Thomas Schroeder rejected that point.
But he did find the plaintiffs could make a plausible argument against another part of the law - one which prohibits new anti-discrimination ordinances at the local level until 2020.
Schroeder determined that such a provision over transgender access could be found to deny them the legal protections other groups have.
The compromise bill was a bipartisan effort to stem the fallout from the original bathroom bill, known as HB2, which drew national attention and a wave of high-profile boycotts of state venues.