A judge has suggested that he will allow the Washington NFL franchise to go ahead with a lawsuit against five Native American activists who petitioned successfully against them to the US Patent and Trademark office.

The suit is the latest twist in a decades-long battle between the team – known by the moniker “Redskins” – and activists who want the name changed to something less offensive. Many consider the name an insulting racial epithet.



The decision is important because it could severely hinder the team’s legal ability to protect its logo from counterfeit merchandise, potentially costing millions of dollars in lost revenue.



This means that where appeals to the team’s billionaire owner, Dan Snyder, have so far failed, the Patent Office’s decision could force the team to change its name – if only because that would be the only way they could protect their merchandising revenues. The ruling is currently on hold while the lawsuit is resolved.



In June, the five activists – Amanda Blackhorse, Marcus Briggs-Cloud, Phillip Gover, Jillian Pappan and Courtney Tsotigh – won a landmark decision from the US Patent and Trademark Office to cancel the NFL franchise’s trademark registration. In their decision in June, the Patent office board said the trademarks were “disparaging to Native Americans.”



In response, instead of taking the case to an appellate court, the team decided to sue the five petitioners in a US district court in Virginia. This is an option used when there is a dispute over a trademark; two companies selling products under the same or very similar logos or names, for example.



This case is extremely unusual because the five defendants have no vested interest in the team name or logo – they petitioned to have the trademark protection removed because of its offensive nature. On this basis, the defendants’ lawyers filed a motion to have the case dismissed.



But on Friday, judge Gerald Lee hinted in a hearing that he would not dismiss the case, saying that to do so would be “unprecedented.” His written decision is expected within the next few weeks.



Christine Haight Farley is a professor of law at the American University, Washington, and has followed the case closely. She told the Guardian that this was a very unusual case. “It’s going to be unprecedented whichever way [the judge] goes.”

“If the court does not dismiss the case, it means that these five petitioners will have to endure federal court litigation, probably with appeals,” Farley said, adding that to do so seemed “perverse.”

But David Glass, the president of the National Coalition Against Racism in Sports and Media, said that he welcomed the legal challenge. “We’re all smiling. We want to get Dan Snyder in court,” he told the Guardian.

Snyder has repeatedly refused to consider re-branding the team, which he claimed in a letter to fans in October 2013 was “a badge of honor” and “a symbol of … strength, courage, pride and respect.”

But many disagree. Joel Barkin, a spokesperson for the Change the Mascot Campaign and the communications director of the Oneida Native American nation, told the Guardian: “[Snyder] has systematically denigrated Native Americans by marketing, promoting and profiting off of a racial slur, and now he is deploying his army of lawyers against Native people if they dare object to his team’s name.”

On Saturday, as many as 5,000 people gathered outside a game between the team and the Minnesota Vikings in Minneapolis on Sunday to protest the team’s name, the largest protest to date against the Washington franchise.

The Minneapolis Star Tribune reported that the mayor of Minneapolis led chants of “change the name,” and that former Minnesota governor Jesse Ventura and representative Betty McCollum also addressed the protest.

Washington lost the game 29-26.