MESA, Ariz.—A fight is brewing between one Scottsdale establishment and the chairwoman of the city’s Human Relations Commission.

At issue is a ban on transgendered people at Anderson’s Fifth Estate nightclub.

Michele deLaFreniere believes it’s wrong to treat gay and transgendered people differently in Scottsdale. DeLaFreniere, 52, has lived as a woman since 2004.

DeLaFreniere filed a discrimination complaint with the Arizona Attorney General’s Office against the Old Town Scottsdale night spot.

Owner Tom Anderson acknowledges banning transgendered people from the club, but he said it was the best solution he could come up with after female customers objected to having “men in dresses” using the women’s restroom.

“There was no place I could put these people,” Anderson said.

While deLaFreniere charged Anderson with bigotry, Anderson said that deLaFreniere threatened to use her position with the city against him, an accusation she denies.

Anderson said his customers “felt totally threatened. I believe I made the right move to protect the women that frequent this club.”