The Giggle for Girls app and founder Sall Grover are seeking to overturn a 2024 finding it discriminated against a transgender user by removing her from the women-only platform in September 2021.
The platform was a "special measure" exempt from discrimination law because it sought to achieve substantial equality between men and women, an appeal court was told on Monday.
The ability to create these kinds of special measures to promote equality would be frustrated if Justice Robert Bromwich's findings remained because they would - by definition - discriminate against some group of people, Noel Hutley SC said.
"A special measure will exclude someone necessarily because it's otherwise not special," he told the Full Court of the Federal Court on Monday.
The barrister said Ms Grover's intention behind the app was to provide a "safe space" for women.
Evidence was shown to the court from women of sexual abuse, alcoholism, trolling and harassment from men who had found refuge on the Giggle platform.
"It's got to the point to say that a by-blow of it is that certain people couldn't get onto it and were hurt by it - that's unfortunate," Mr Hutley said.
The evidence showed "the most deplorable behaviour of men on the internet," he told a panel of three judges.
The need for this type of space was "manifest" and it was a special measure despite excluding certain groups.
Lawyers from the Sex Discrimination Commissioner have challenged this in court, saying "invidious discrimination" could be - on Giggle's view of the world - permitted to take place under the guise of a special measure.
When Mr Hutley said this was an "extreme example" and did not need to be considered, one judge pushed back - asking why someone seeking to actively harm another group would be protected.
"Why would the (Sex Discrimination Act) then say that's OK?" Justice Melissa Perry asked.
Mr Hutley replied by saying parliament had to form a compromise when enacting the legislation.
"So you say as long as you have a purpose of achieving substantive equality between one of the protected groups, you're in, irrespective of the nature of any other purpose?" the judge asked.
"Quite," Mr Hutley replied.
"If your purpose was to advance women, (if another) purpose was to disadvantage men then there's nothing wrong with that."
Justice Perry asked what Ms Grover meant when she said she wanted Giggle to be a women-only safe space.
"Women who she had judged to look like women," Mr Hutley replied.
"No, but you're going in circles," the judge noted.
Ms Grover denies findings she rejected Roxanne Tickle - who was born male but identifies as female - from the app in September 2021 because she did not look like a cisgender woman.
Rather, she simply weeded out people who did not "appear female," Mr Hutley said.
"Isn't that a distinction without a difference?" Justice Perry asked.
Ms Tickle has also filed her own challenge to Justice Bromwich's decision, seeking to increase the $10,000 in damages he awarded her in August 2024.
She further claims the judge wrongly found she was not directly discriminated against by Giggle and Ms Grover.
The judge found that a condition by the platform that its members had the appearance of cisgender women did not specifically target Ms Tickle but indirectly discriminated against her.
Her barrister Georgina Costello KC gave short submissions that her client was in fact a woman and that the definition of "sex" was not confined to a biological concept.
The hearing continues on Tuesday.
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