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Court Backs School District in Principal's Whistleblower Case

A federal appeals court has upheld the dismissal of an Illinois middle school principal who contends she was terminated for raising questions about alleged financial improprieties by her predecessor.

A three-judge panel of the U.S. Court of Appeals for the 7th Circuit, in Chicago, ruled unanimously that the whistleblowing complaints by principal Julie McArdle were job-related speech not protected by the First Amendment under a key U.S. Supreme Court precedent.

McArdle took over as principal of Lindbergh Middle School in Peoria, Ill., School District No. 150 in the fall of 2008. Her predecessor at Lindbergh, Mary Davis, became academic officer of the Peoria district and was McArdle's immediate supervisor. Court papers say McArdle soon discovered financial irregularities, including Davis's alleged use of a school credit card for personal expenses and payments to a student teacher in violation of district policy.

McArdle questioned her superior about the irregularities but received evasive responses, court papers say. Davis soon put McArdle on a performance review plan for purported parental complaints, and by April 2009 McArdle was informed by district officials that she was being recommended for early termination of her two-year principal's contract. The Peoria school board voted 4-1 to end McArdle's contract after one year.

Meanwhile, McArdle consulted an attorney and filed a police report about Davis's alleged misuse of funds. The Peoria Journal-Star newspaper reported that Davis pleaded guilty in February 2012 to a misdemeanor charge of obstruction of justice for lying to a Peoria police detective about her use of school funds. Sixteen felony charges were dropped as part of the plea agreement, the newspaper reported, though Davis agreed to reimburse the school district some $10,000. Davis herself was dismissed by the district in 2010 amid the investigation, though a state hearing officer recently ordered her reinstated, the newspaper reported.

McArdle sued the school district and Davis, alleging that her termination was influenced Davis's improper motive of preventing her from revealing the financial improprieties.

A federal district court granted summary judgment to the school district and Davis, and in a Jan. 31 decision in McArdle v. Peoria School District No. 150, the 7th Circuit court panel upheld the dismissal.

"We conclude that McArdle's reporting of [the alleged] misconduct was speech as a public employee, and was not shielded from her employer's response by the First Amendment," the appeals court said.

The 7th Circuit cited the Supreme Court's 2006 decision in Garcetti v. Ceballos, which held that "when public employees make statements pursuant to their official duties, the employees are not speaking as citizens for First Amendment purposes, and the Constitution does not insulate their communications from employer discipline."

The 7th Circuit also cited two of its own precedents since Garcetti holding that public employee's commentary on misconduct within the employee's area of responsibility was speech as an employee and not as a private citizen.

The appeals court said Lindbergh Middle School's "reputation, its adherence to district policies, and its finances were all matters within McArdle's oversight as the school's principal, and were all allegedly impacted by Davis' misconduct. In reporting on that alleged misconduct, McArdle spoke about matters that directly affected her area of responsibility."

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