On Tuesday, April 19, 2016, the Fourth Circuit Court of Appeals issued a landmark decision, holding for the first time that federal law prohibits public schools from denying transgender students access to bathrooms that correspond with their gender identities. The Fourth Circuit's 2-1 decision overturned the United States District Court for the Eastern District of Virginia’s holding that Title IX of the Education Amendments Act does not allow for students to use the restroom that aligns with their gender identity. In invalidating this decision, the Fourth Circuit looked to the Department of Education’s own interpretation of Title IX—“[w]hen a school elects to separate or treat students differently on the basis of sex . . . a school generally must treat transgender students consistent with their gender identity.”

After finding the law and its regulations ambiguous, the Court deferred to the Department’s interpretation and remanded the case to the District Court. The Court’s decision is worded in a way that all but ensures that, G.G., the transgender male student at the heart of this case, will be allowed to use the restroom that aligns with his gender identity.This decision’s implications will likely be massive, especially in North Carolina where HB-2’s dark clouds still hang heavy.

First and foremost, the Fourth Circuit’s decision brings HB-2 into directly conflict with Title IX. In a nutshell, the Fourth Circuit held that Title IX directs public schools to allow students to use the bathroom that corresponds with their gender identity. HB-2 does the exact opposite and forbids this. What does it mean? If North Carolina public schools—including schools like the University of North Carolina—comply with North Carolina’s HB-2 they will also necessarily violate Title IX, meaning that they will lose Title IX federal funding. That funding amounts to $4.5 billion.

Second, and relatedly, this marks the biggest blow to date against HB-2, making its repeal more and more likely. National scorn and corporations turning their backs on this state are one thing; losing $4.5 billion in one fell swoop is another. It’s telling, if not symbolic, that Governor McCrory himself filed a brief with the Fourth Circuit defending the lower court’s decision to bar the student from the bathroom of his gender identity. That side lost. The tide seems to be turning.

Finally, the Fourth Circuit’s decision offers a buoy to North Carolina’s transgender community in what has been a sea of bad news. In reaching its decision, and analyzing the Department of Education’s interpretation, the Fourth Circuit looked to prevailing dictionary definitions of “sex” and found that a binary “male/female” explanation doesn’t cut it. The issue is more complex than that, and the concept of gender identity cannot be ignored. The decision’s facts also delve into the hardship that G.G., born female but identifying as male, faced under the now invalid definition. For example, he suffered multiple urinary tract infections from holding his urine in order to avoid using the restroom at school all together. His harm was severe and both mental and physical. HB-2 disregards harms like these as mere byproducts of a solution to a problem that does not exist.

Tuesday’s ruling chips away at this mentality and suggests a way forward reminiscent of the not-so-distant past. It very well could be that HB-2 goes the way of North Carolina Amendment 1, which officially banned gay marriage in this state before federal courts stepped in and did the right thing. It may be only a matter of time before HB-2 is entirely invalidated. Tuesday’s ruling was a good first step towards that. The Fourth Circuit’s decision can be found in its entirety here.