U.S. District Court Judge Peter Messitte shot down the Justice Department’s request to dismiss the lawsuit, which argued the plaintiffs had no legal standing to sue. The Greenbelt, Md.-based judge said he will schedule another hearing to weigh the administration’s other claims.

The decision is a blow to Trump, who has long claimed that his business arrangements are legal and do not pose a conflict of interest.

Critics say that Trump is violating the emoluments clause, which bans presidents from receiving gifts or payments from foreign governments without Congress’s explicit approval.