A federal appeals court has upheld a judge’s decision to deny the city of Mount Clemens and individual defendants’ attempt to throw out a lawsuit by a former employee who claims whistleblower retaliation.

The Sixth Circuit U.S. Court of Appeals upheld U.S. District Judge Jonathan Grey’s decision last June to maintain the lawsuit by Lori Mertins, a former accounting technician who left the city in 2016.

Mertins claims her First Amendment right to free speech was violated when she was retaliated against by the city bosses for several years after informing them she discovered the city was overcharging residents for water billing. No formal allegation for overbilling was ever made.

The city in its appeal asked the court to overturn Grey’s determination that the city is not protected by qualified governmental immunity but failed to address the issue at hand, the court says in a three-page opinion issued March 18.

“Nowhere do they dispute the district court’s key holding that denial of a promotion and discipline for made-up violations infringed Mertins’ clearly established First Amendment rights,” says a three-judge panel.

The appeals judges says the defendants merely contend that the district judge misinterpreted the facts by saying, “the Court made some shocking findings … which are unsupported by any piece of evidence within the record.”

But the appeals court says by case law it cannot dispute the facts.

“We accept the facts as construed by the district court and evaluate de novo whether those facts overcome defendants’ qualified immunity as state actors,” the appeals judges.

The individual defendants argued it was “simply without basis” for the district court to say “simple management functions . . . . violated a clearly established Constitutional right.” However, the appeals judges rejected that notion, saying the defendants failed to provide support “for this conclusory statement,” the appeals judges wrote.

The appeals court also says by rule it cannot rule on the Judge Grey’s maintaining the claim appeal over the city’s “policies, procedures, or customs,” based on case law.

The same appeals circuit in 2020 threw out Mertins’ claim of intentional infliction of emotional distress but upheld the First Amendment claim and sent it back to district court, where it sat until Grey’s ruling 10 months ago.

Attorneys did not return calls seeking comment.

The case now returns to U.S. District Court in Detroit, where Grey scheduled an April 18 status conference.

The case has languished due to the 2022 death of the original judge, Arthur Tarnow, and delays related to the COVID-19 pandemic and unsuccessful attempts to settle it.

Mertins initially went to her bosses in 2009 with her concerns and then raised concerns to two law enforcement agencies, including the FBI, and city commissioners from 2010 to 2012, according to the lawsuit.

She says from 2011 to 2016 she was retaliated against, claiming two supervisors denied her promotions and disciplined her for false accusations. She alleges the city manager at the time continued a campaign of retaliation by harassing her when she was on medical leave.

Due to the stress of the alleged harassment, Mertins says she took off time in late 2015 via the Family Medical Leave Act before she returned to city hall in January 2016 but quickly returned to leave, according to the lawsuit. She did not return to work by May 11, 2016 as ordered after the city denied her workers’ compensation claim. The city then canceled her benefits.

In a separate matter, Mertins won an $18,000 arbitration award in January 2015 because she was performing accounting technician III duties but was only being paid as a accounting technician I.