Attorney General Loretta Lynch on Monday accused the state of North Carolina of "state-sponsored discrimination against transgender individuals."
Lynch said during a press conference the controversial "bathroom" law targeted transgender people who sought "to engage in the most private of functions in a place of safety and security, a right taken for granted by most of us."
She also warned that the federal government could curtail federal funding for North Carolina if the state continued to enforce the law.
She noted that the Justice Department had sent a letter to North Carolina governor Pat McCrory, warning that the law violated Title VII of the Civil Rights Act. But "instead of replying, North Carolina and its governor chose to respond by suing, thus we are filing a civil rights lawsuit against North Carolina," Lynch said.
"What we must never do is turn on our neighbors, our family members, and our fellow Americans for something they cannot control and deny what makes them human. This is why none of us can stand by when a state enters the business of legislating identity and insists a person pretend to be something or someone they are not."
"This is not the first time we've seen discriminatory responses to moments of progress," she remarked. "This law provides no benefit to society. All it does is harm innocent Americans."
Lynch also chided North Carolina, saying that "this country was founded on equal rights for all."
The so-called “bathroom law” requires that people use the restroom corresponding to their birth gender. The law also prohibits local governments from banning discrimination against LGBT people.
The Department of Justice sued North Carolina on Monday, seeking a permanent injunction to block the law and a declaration that it is discriminatory.
More than $800 million in federally-backed loans for public universities are at risk if North Carolina refuses to comply with the federal government, according to the Associated Press. The University of North Carolina system could lose more than $1.4 billion in federal funding.
Watch video, courtesy of Justice Department, below: