The city of South Euclid, Ohio has backed down after a Catholic school filed a lawsuit challenging the city's anti-discrimination law on the grounds that it infringed on its religious freedom.

The city announced earlier this week it would not apply the law to the Catholic school after refusing for months to say whether the statute would require the school to operate against its religious beliefs, according to an Alliance Defending Freedom news release.

The Lyceum sued the city in April, arguing the law would violate its religious rights by raising the prospect of penalties for its beliefs about marriage and gender identity. The school suggested its admissions and employment policies could place it at risk under the ordinance.

The school upholds the Catholic beliefs that marriage is between a man and woman, sex should be reserved for marriage, and a person's gender is determined at birth. Students and faculty are expected to abide by these beliefs, and students who disagree with the teachings can be denied admission or expelled.

The city's ordinance prohibits denying rights such as employment on the basis of sexual orientation and gender identity or expression, and it lacks an exemption for religious beliefs.

The ordinance initially contained protections for religious organizations, but these were removed from the final text. The school sought clarification about the law on multiple occasions prior to filing a lawsuit, but received no response.

The school and its attorneys dismissed the lawsuit on Tuesday after the city stated the school is not subject to the law.

"Religious schools like the Lyceum have the freedom to operate consistently with their faith without fear of unjust government punishment—and we’re glad South Euclid now affirms this reality," ADF Legal Counsel Christiana Holcomb said. "No one should have to file a federal lawsuit simply to find out whether they are violating a vague law with criminal penalties. We’re disappointed that the city didn’t do the right thing right from the start, but we’re pleased that it now acknowledges that The Lyceum’s parents, students, and faculty have the freedom to seek out this unique, faith-based education and maintain community standards rooted in Catholic teaching."