Sixth Circuit Finds Sexual Harassment Claim Can Bar Entire Case From Arbitration

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Quick Hits

• In Bruce v. Adams and Reese, LLP, a former employee sued a law firm for disability discrimination, retaliation, sexual harassment, and hostile work environment.
• The Sixth Circuit recently concluded that a mandatory pre-dispute arbitration agreement is voidable when a plaintiff brings multiple claims in a case that includes sexual harassment and/or sexual assault.

This is the first federal appellate ruling to find that an entire lawsuit is barred from arbitration under the EFAA if it includes a sexual harassment claim. Other federal circuit courts have not yet ruled on this question, although several cases are pending.

In this case, the plaintiff was diagnosed with post-traumatic stress disorder, attention deficit hyperactivity disorder, social phobia, depression, sleep apnea, insomnia, and restless leg syndrome. In suing her former employer, she alleged sexual harassment under Title VII of the Civil Rights Act of 1964 and failure to accommodate her disability under the Americans with Disabilities Act (ADA). Her former employer moved to dismiss her sexual harassment claim and compel arbitration of her ADA claim.

Background

The plaintiff, a paralegal, signed an arbitration agreement when she began working at Adams and Reese in 2022. She alleged that her supervisor often made sexual comments to her and about her appearance, clothing, and personal life, even after she rejected his frequent invitations to social events.

Sometimes the paralegal’s sleep medication caused her to arrive late at work. At first, the firm allowed a flexible schedule, but later it placed her on a fixed schedule and told her she would be fired if she arrived late again. The law firm discharged her on May 11, 2023, after she arrived late.

The former employee sued in July 2024 for disability discrimination, alleging the firm did not engage in an interactive process and failed to accommodate her medical need to take sedatives to sleep. She also alleged sexual harassment and retaliation under Title VII, which makes it illegal for employers to discriminate against employees based on sex or retaliate against employees for reporting sexual harassment.

Adams and Reese asked the court to dismiss the Title VII claims and compel arbitration of the ADA claims.

The Court’s Decision

On February 25, 2025, the U.S. District Court for the Middle District of Tennessee denied the employer’s motion to dismiss, finding that the supervisor’s repeated sexual comments were “sufficiently pervasive” and unwelcome to plausibly allege sexual harassment under Title VII. The district court also denied the motion to compel arbitration of the ADA claim, finding that the EFAA barred arbitration of an entire case that included a sexual harassment dispute. The law firm appealed.

On appeal, the Sixth Circuit addressed whether the EFAA barred arbitration of all of the claims alleged by the plaintiff or only barred arbitration of her sexual harassment claim. Reviewing the language of the EFAA, the Sixth Circuit observed that the statute invalidates a pre-dispute arbitration agreement “with respect to a case” that “relates to” a sexual assault or sexual harassment dispute. The court explained that “case” is the “operative word here” and “encompass[es] a plaintiff’s entire suit,” not just her sexual harassment or sexual assault claim.

The Sixth Circuit therefore affirmed the district court’s denial of the motion to compel arbitration of the ADA claim because it was alleged within a case that relates to a sexual harassment dispute.

The Sixth Circuit covers Kentucky, Michigan, Ohio, and Tennessee.

Next Steps

The Sixth Circuit is the first federal court of appeals to hold that the EFAA bars enforcement of a mandatory pre-dispute arbitration agreement with respect to an entire case that includes a sexual harassment claim. Other courts may follow suit.

Employers can expect that plaintiffs with allegations of sexual harassment will now be more likely to try to invalidate their arbitration agreements under the EFAA with respect to all claims in a case, including those unrelated to alleged harassment.

Employers may wish to review their arbitration agreements and other employment agreements to determine whether it is possible to mitigate this risk through additional or updated contract terms. In addition, employers may wish to ensure that their anti-harassment and anti-discrimination policies and procedures are up-to-date and effectively enforced.

Ogletree Deakins’ Arbitration and Alternative Dispute Resolution Practice Group will continue to monitor developments and will post updates on the Arbitration and Alternative Dispute Resolution, Employment Law, and State Developments blogs as additional information becomes available.

Eric M. Fox is a shareholder in Ogletree Deakins’ San Diego office.

Christopher C. Murray is a shareholder in Ogletree Deakins’ Indianapolis office.

This article was co-authored by Leah J. Shepherd, who is a writer in Ogletree Deakins’ Washington, D.C., office.

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