Indiana School Settles Lawsuit After Firing Counselor over Gender Policy

An Indiana school district has to pay a $195,000 settlement in a lawsuit brought by a school counselor who was fired for speaking publicly against her school’s “gender identity” policy. 

Kathy McCord, who worked for decades as a school counselor at Pendleton Heights High School for the South Madison Community School Corporation, was fired after she answered questions from a reporter about the district’s “Gender Support Plan” and confirmed that the policy did not require teachers to inform parents of their child’s desire to change pronouns or identify as a different sex. Alliance Defending Freedom filed a lawsuit on behalf of McCord in 2023. 

“I am thrilled to see this case settled, but most of all I am grateful that Indiana law now requires the South Madison Community School Corporation to notify parents about a child’s request to change his or her name or pronouns,” Kathy McCord said in a statement to Fox News Digital. 

The school district enacted the policy in 2021 without informing the public, and even required teachers to hide students’ “gender identities” from parents, the ADF alleges. 

A local journalist learned of the policy from someone in the community and launched his own investigation, ADF said. The journalist asked Kathy to confirm information he had already gathered from other sources, and she agree to an interview as a private citizen. When he asked her if the school district was keeping secrets from parents, “she felt compelled to answer honestly,” the ADF said. 

After the article was published, which was critical of the district’s gender policy, the school board voted to fire McCord. 

Vincent Wagner, senior counsel at ADF, told Fox News Digital he hopes the settlement will encourage other educators who feel their constitutional rights are being trampled. 

“Our client, Kathy McCord, was fired after expressing her personal beliefs — speaking on her own time in her personal capacity out of concern for her students — based on her unwillingness to lie to parents,” Wagner said. “Kathy knows what should be obvious to everyone: When a student struggles with gender, sexuality, or any other important issue, parents should be included so they can make the best decision for their child. Schools should actively partner with parents, not cut them out. Lying to and hiding information from parents violates their constitutional rights. And it can send struggling children down a one-way path to irreversible harm.”

“When I spoke out on my own time in my personal capacity, I did so because I understood how important it is for parents to be involved in all matters of their child’s life — especially when their child is struggling,” McCord added. “I loved and cared for students for over 37 years. Despite decades of success as a teacher and school counselor, I was fired after simply expressing my beliefs on an important topic, which were different than the school district’s. No public-school employee should be fired for expressing her personal beliefs or be forced to lie to students or parents.”

South Madison Community School Corporation told the outlet in a statement that it “has concluded the lawsuit filed by former employee Kathy McCord. In August 2025, the Court ruled in favor of SMCSC on the majority of Ms. McCord’s claims, including a finding that the District did not violate her First Amendment rights.”

SMCSC added that a settlement does not equal an admission of wrongdoing. 

“While the District feels confident it would have prevailed on the only remaining claims if they had proceeded to trial, the parties have now reached a settlement,” the statement reads. “SMCSC chose to settle to avoid the significant time, expense, and disruption of continued litigation and to allow the District to remain focused on serving students. SMCSC has not admitted any wrongdoing, and the Court made no findings of liability against the District. SMCSC remains focused on its mission of supporting students, staff, and the entire school community. The district appreciates the continued support of its families and community members.”