On Friday, the Ninth Circuit Court of Appeals declared that discrimination on the basis of someone’s transgender identity is sex-based discrimination. This marks an important, if qualified, step forward for transgender rights.

The decision came in the case of Karnoski v. Trump, one of four legal challenges to the Trump administration’s ban on transgender people serving in the military. President Donald Trump first announced his ban via a series of tweets in July 2017, declaring that after “consultation” with experts, the government would no longer accept or allow transgender people to serve “in any capacity” in the U.S. military. Trump cited, without evidence, the “tremendous medical costs and disruption” caused by transgender troops.

Trump’s military service ban is yet another reversal of an Obama-era policy permitting expanded rights for transgender people. It’s steeped in anti-trans bias and lacks any evidence of need, and the federal courts have taken notice. A few short months after Trump tweeted out his policy, no fewer than four federal courts had blocked the ban as unconstitutional, citing Trump’s tweets as proof of discriminatory intent and lack of legal justification.

In response to the injunctions blocking the ban, Trump ordered then-Secretary of Defense James Mattis to call a study group of military leaders and issue recommendations on how to implement the ban, which Mattis did in 2018. According to reporting by Slate, Vice President Mike Pence joined other notable anti-LGBTQ advocates like Tony Perkins and Ryan Anderson in helping to draft the Mattis policy. Mattis ultimately recommended the military bar transgender people from enlisting and encouraged the administration to discharge any enlisted members who wished to transition. Mattis suggested the administration grandfather in those service members who had come out under the Obama administration, but said that any transgender people should be allowed to enlist and serve only if they remain “in their biological sex.”

The “Mattis policy” was the administration’s attempts to reverse-engineer a legal justification for its transgender military service ban, plain and simple. Trump implemented the Mattis recommendations and then asked the federal courts to reconsider their injunctions based on the administration’s “revision” of its initial ban. The federal courts refused, so the administration took their request to the U.S. Supreme Court. In January 2019, the Court issued a 5-4 decision lifting two of those injunctions but ruling the legal challenges to the administration’s policy could continue. That allowed the Trump administration to begin implementing its policy while the legal challenges made their way through the appellate courts.

Friday’s opinion from the Ninth Circuit came in one of those cases, and the decision is a mixed bag for advocates. First, the Ninth Circuit vacated a court order maintaining one of the original preliminary injunctions against the ban and directed the district court that issued it to take another look. Given the action by the Roberts Court in January, that outcome was not unexpected: The injunction had effectively been lifted anyway. It still feels like a setback, though.

But there’s real reason to think that setback is only temporary. When directing the lower court to reconsider its analysis of the Trump administration’s ban, the federal appeals court offered some important guidance on how that new analysis should proceed.

First, the Ninth Circuit ruled  there is enough of a distinction between the transgender ban Trump first tweeted out in 2017 and the Mattis policy to warrant the district court treating them differently, despite any similarities. During the preliminary injunction proceedings, the lower court had treated the Mattis policy as merely an extension of the 2017 ban. That, the Ninth Circuit held, was a mistake.

The Ninth Circuit also reversed the district court’s application of strict scrutiny in blocking the ban, holding that heightened scrutiny—a slightly lower standard—should apply instead. The Trump administration had argued that rational basis, the lowest level of constitutional scrutiny, should apply, because the case involved judicial review of a military decision. The Ninth Circuit rejected this argument outright, instead holding that discrimination on the basis of transgender status is sex-based discrimination and therefore subject to heightened scrutiny.

That means that when the district court takes another look at the Trump transgender military service ban, the administration is going to have to show that its policy is supported by an “exceedingly persuasive justification.” Since the administration has no apparent justification for the policy other than anti-trans animus, I’m optimistic a new preliminary injunction blocking the ban will be issued in short order.

“This is a hugely positive development,” said Jennifer Levi, director of the Transgender Rights Project at GLBTQ Legal Advocates & Defenders, in a statement following the decision. “The Ninth Circuit recognized that the Mattis plan clearly targets transgender people, and that the government faces an uphill battle in justifying it.”

Friday’s decision also means that any anti-transgender policy coming from states covered by the Ninth Circuit Court of Appeals must meet this heightened standard. That includes any policies coming out of Arizona, Washington, Oregon, Alaska, Hawaii, Idaho, Nevada, Montana, Guam, and the Northern Mariana Islands. Friday’s decision will also affect other transgender rights cases pending before the Ninth Circuit, such as a challenge to a trans-inclusive Oregon school district or a case challenging Arizona’s policy of excluding transition-related care in insurance for state employees.

All this is good news for trans people. But the legal landscape remains unsettled.

Next term, the Supreme Court will consider whether or not an employee can be fired simply for being trans. Not surprisingly, the Trump administration has taken the position that they can be, and it’s possible there are five justices on the Supreme Court who agree. Such a decision, should it be issued, could undo much of the reasoning in Friday’s Karnoski opinion. But the Roberts Court hasn’t issued any anti-trans decision like that yet. Even if it does, Friday’s decision is still important, especially for transgender people in the conservative states covered by the Ninth Circuit. The appeals court made it clear Friday that a transgender person in Arizona has the same rights as a transgender person in California and that the neither the government, nor anyone else subject to civil rights laws, can invent reasons to discriminate against transgender people and expect the courts to go along with it.

It increasingly feels like there are little, if any, checks against the worst impulses of the Trump administration. But Friday’s decision recognizing the administration’s transgender military service ban for what it is—nothing more than naked animus dressed up as military policy—was a welcome reminder that not all legal resistance to the administration’s power grabs has failed.