Perhaps you left something out, but you say nothing about why the city should be liable.

Yes they can. You need to learn to abide by the rules.

Well, the only way to know for sure is to go to trial and have a judge decide.

This general Q&A forum is not the place for specific legal advice. He needs to pay an attorney to do the research for him.

Generally speaking you can be fired, or quit, for any or no reason, even if they are wrong.

You should certainly raise the issue with your lawyer.

No, this is not a HIPAA violation......................

You can sue. But you will lose, and probably have to pay their lawyers' fees.

And you think a bunch of lawyers on the Internet know?

She is not required to accept your payment plan.