Is being called gay defamatory?

The Lambda Legal Defense Fund, the main legal arm of the gay rights movement, has filed a friend of the court brief in a case in which Howard K. Stern is suing for defamation, saying that he was defamed by being called gay, and that being called gay is "defamatory per se."

The Lambda brief contests this, saying:

Lambda Legal’s friend-of-the-court brief argues that Stern’s first two claims of defamation rest on the flawed premise that being called gay would expose someone to public hatred and shame – a premise that is disproved daily throughout New York, including through the service of New York’s many openly gay and lesbian public officials.

So wait. After all these years of being told that gays are discriminated against, now they're not? So I guess we must not need all those gay rights laws anymore, right?