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I am not an expert but one of the things I got out of my higher education law class was that if you don't protect your rights, they can be taken away. Yeah, its true--DZ may suffer in numbers or reputation by pursuing this suit. And as an administrator, I would be hesitant about bringing a group to campus that was known for suing another school.
But I wonder--wouldn't it be worse if we, GLOs, lost the right to decide who our members are? Wouldn't it be worse if we didn't have a right to be autonomous and run our organizations by our own values? (This is also why many orgs are resistant to university efforts for values congruence relationship statements etc.)
We need to protect our rights.
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