[mi] Landlord Served A 7-day Eviction Notice In Retaliation After I Contacted Code Enforcement And Tried To Escrow Rent Over An Illegal Shared Utility Meter. What Are My Next Steps?

TL;DR: I discovered my landlord has me paying the electricity for other tenants on a shared meter (foreign load). I contacted the city/utility company and initiated a legal rent escrow. The landlord offered a settlement, but when I asked for basic protections in the contract, they rescinded the offer and immediately served me with a 7-Day Demand for Possession.

Location: Pontiac, Michigan

The Background:
I rent an upper unit in a multi-family home for the 15 months. In May, I discovered my electrical panel is tied to a shared grid ("foreign load") that powers the lower tenants' unit, including common areas and outdoor lights. The landlord and lower tenants were aware of this configuration before I signed my lease, but it was never disclosed to me.

Because I work during the day and the lower tenants are home, I have been subsidizing their electricity usage. I pulled my hourly DTE energy data and have undeniable proof of massive energy spikes happening during the workday while I am not even on the property.

The Escalation:
I contacted DTE and City Code Enforcement. I was advised that this undisclosed cross-metered configuration is a foreign load and a potential safety/code violation (as I cannot kill the power to my own unit without having to disable both units).

Because the landlord refused to physically fix the wiring to code, I began the legal process of putting my rent into a City-administered Rent Escrow Account.

The "Settlement" and Retaliation:
To avoid the city getting involved, management drafted a settlement agreement offering to cover most of my utility costs. However, the contract had loopholes (like strict 5-day deadlines for me to submit bills or the contract voids, and no cap limits).

I sent back a redlined version with standard, basic tenant protections (like a right-to-cure clause and a rent-increase freeze). In response, the landlord accused me of materially altering the agreement, completely rescinded the settlement offer, and immediately served me with a 7-Day Demand for Possession.

I am gutted for being gullible and can see this was a setup from the beginning.

I know a 7-Day Demand isn't an actual eviction order yet, but if she files in court, how strong is my Retaliatory Eviction defense under MI law (MCL 600.5720)? She served this right after I contacted Code Enforcement and used a legal escrow.

Should I continue to deposit my rent into the City Escrow account while waiting to see if she actually files for eviction?

What specific documents should I prepare to bring to my hearing to guarantee the judge sees this for the retaliation it is?
4. Has anyone dealt with "foreign load" utility fraud in Michigan, and can I countersue for the stolen electricity?