Introduction: Under the EFAA a Covered Sexual Harassment Dispute May Render the Entire Case Non-Arbitrable
The presence of a sexual harassment claim in a case featuring otherwise arbitrable claims may mean that Chapter 4 of the FAA renders the entire case non-arbitrable. In our recent overview of the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (the “EFAA”), we identified the statute’s arguably most consequential open question: when a complaint includes a covered sexual-harassment dispute and non-covered claims, does the EFAA keep the whole lawsuit in court, or only the harassment claim, thereby effectively bifurcating the dispute-resolution process?
The U.S. Court of Appeals for the Sixth Circuit recently answered that controversial open question, becoming the first U.S. Circuit Court of Appeals to do so. In Bruce v. Adams & Reese, LLP, No. 25-5210, slip op. (6th Cir. Feb 25, 2026), the U.S. Court of Appeals for the Sixth Circuit—in a 2-1 opinion written by U.S. Circuit Judge Karen Nelson Moore— held that, under the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (the “EFAA”), a single plausibly pleaded sexual-harassment claim can keep an entire mixed-claim employment case out of arbitration, even if the other non-harassment/non-assault claims would otherwise be arbitrable.
Bruce places the first federal-circuit-court-of-appeals imprimatur on the broad reading of Section 402(a), which several district courts have adopted, and which we flagged in our earlier article as a likely flashpoint. It also raises the stakes of the pleading-stage fight over whether the plaintiff has adequately alleged a covered sexual-harassment or sexual-assault dispute.
In Bruce, adequate pleading was linked to arbitrability: because the plaintiff plausibly pleaded a Title VII hostile-work-environment claim, the employer could not compel arbitration of her ADA claims, which would otherwise have been arbitrable.
What Happened in Bruce
Bruce worked in a law-firm liquor practice that moved from Firm A to Firm B. Bruce alleged that, after her move to Firm B, a supervising lawyer, R. Pinson, continued making sexual comments and jokes to and about her, including repeated remarks about sending her to clients “in a short skirt,” repeatedly saying “Hoe no” to her instead of “Oh no,” and making a comment about how “hot” it would be to see her and another paralegal engage in sexual acts on his desk. She also alleged that he made inappropriate comments about her appearance, clothing, private life, and later her engagement and relationship. According to the complaint, the conduct was ongoing, occurred in work-related conversations and team meetings, and continued until her termination.
Bruce also asserted Americans with Disabilities Act (“ADA”) claims arising from alleged failures to accommodate sleep-related disabilities and from her eventual termination. Firm B moved to dismiss the sexual-harassment claim and to compel arbitration of the ADA claims under an arbitration agreement. The district court denied both requests, holding that Bruce had plausibly stated a sexual-harassment claim and that the EFAA foreclosed arbitration of the entire action. Firm B took an interlocutory appeal. See 9 U.S.C. § 16(a)(1)(C); slip op. at 5-6.
The Sixth Circuit’s Two Holdings
Before the Court were two issues: whether the district court erred in concluding that (a) Bruce had plausibly pleaded a Title VII hostile-work-environment claim based on her allegations of sexual harassment; and (b) the EFAA barred arbitration of Bruce’s entire case, including her ADA claims. The Sixth Circuit held that both of the district court’s conclusions were correct.
First, it held that Bruce had plausibly alleged a hostile-work-environment sexual-harassment claim against Firm B. Slip op. at 11-15. The court emphasized that it was evaluating the complaint at the pleading stage, not on summary judgment, and that Rule 8 does not require a plaintiff to plead every offensive comment with granular detail. The court also drew an important line: conduct alleged to have occurred at Firm A could not be attributed to Firm B, so the Court court analyzed only what the complaint alleged to have occurred after Bruce and Pinson joined Firm B. But even with that limitation, the Court found the allegations sufficient. The complaint described repeated sexualized comments, alleged that they were ongoing and humiliating, and asserted that Bruce altered her behavior at work to avoid Pinson. That was enough, said the panel majority, to plausibly plead conduct that was sufficiently severe or pervasive to create a hostile work environment.
Second, and more significantly for arbitration law, the court held that the EFAA barred arbitration of Bruce’s entire case, including her ADA claims. Slip op. at 21. The court treated that issue as one of statutory text, not arbitration policy. Once Bruce plausibly alleged a covered sexual-harassment dispute, Section 402(a) made the arbitration agreement unenforceable “with respect to a case” filed under federal, tribal, or state law that “relates to” that dispute. Slip op. at 16-18. For the Sixth Circuit, that language means what it says. See slip op. at 16-21.
Why the Sixth Circuit Adopted the EFAA Entire-Case Rule
The court’s reasoning was straightforward and textual.
FAA Section 401 defines a “sexual harassment dispute” as “a dispute relating to conduct that is alleged to constitute sexual harassment under applicable Federal, Tribal, or State law.” 9 U.S.C. § 401(4). Section 402(a) says “at the election of the person alleging conduct constituting a sexual harassment dispute or sexual assault dispute . . . no predispute arbitration agreement . . . shall be valid or enforceable with respect to a case which is filed under Federal, Tribal, or State law and relates to the sexual assault dispute or the sexual harassment dispute.” 9 U.S.C. § 402(a) (emphasis added).
The key word, said the Court, was “case.” Section 402(a) does not say that a pre-dispute arbitration agreement is unenforceable only as to a covered “claim” or “cause of action.” It says the agreement is unenforceable “with respect to a case.” The ordinary meaning of “case,” the court explained, is an entire civil action or proceeding, not an individual claim or count within it. The court reinforced that point by contrasting “case” with “claim,” noting that claims are component parts of a suit, while a case is the whole suit. See slip op. at 17-18.
The court then construed “case” together with the statute’s other important phrase: “relates to,” an expansive descriptor. If a lawsuit contains a covered sexual-harassment claim, then the “case” “relates to” a sexual-harassment dispute. On that textually-based yet expansive reading, if the complaint adequately pleads a covered dispute, the arbitration agreement is unenforceable not only as to that dispute but also as to the other claims in the case. Slip op. at 17-18.
The Court’s reasoning, as a practical matter, ensures that if a sexual harassment or sexual assault dispute is part of a case, then all other claims in the case are, at the election of the person alleging sexual harassment or assault, not arbitrable.
A limiting principle, if there is one, might be based on alleged improper joinder. If a claim was joined in a case but should not have been—and should have been brought in a different case that does not relate to the sexual assault or sexual harassment dispute—then perhaps the “relates to” requirement is not met. One could argue that the “case” did not encompass the otherwise arbitrable claims and that it thus did not relate to those claims.
But joinder appears to be of limited utility as a potential limiting principle. The federal-court joinder rules are so permissive that improper joinder would be the rare exception, not the rule. See Fed. R. Civ. P. 18(a) (“A party asserting a claim, counterclaim, crossclaim, or third-party claim may join, as independent or alternative claims, as many claims as it has against an opposing party”); see also Fed. R. Civ. P. 18(b).
The Sixth Circuit also relied on statutory structure for its arbitrability conclusion. Congress, the court reasoned, had various options open to it if it intended to limit the effect of the EFAA to sexual harassment and assault claims only. It availed itself of none.
It might have used the term “claim” instead of “case.” Slip op. at 18-19. It could have omitted the phrase “a case which is filed under Federal, Tribal, or State law and relates to” the covered dispute. Slip op. at 18-19. Or it could have borrowed wording from other statutes that bar arbitration only of specific disputes arising under a particular statutory section. Slip op. at 18-19. Congress did none of those things.
Firm B’s policy arguments did not persuade the majority. It invoked the federal policy favoring arbitration and argued for claim-by-claim arbitrability on that basis. Slip op. at 19-20. The court responded that the presumption applies to arbitration-agreement interpretation, not to the rewriting of an unambiguous statutory exception enacted by Congress. And it rejected the suggestion that giving effect to the ordinary meaning of the text would produce absurd consequences. Slip op. at 20-21. To the contrary, explained the court, keeping claims that are part of the same case together may further the EFAA’s purpose by avoiding the cost and deterrent effect of dual-track proceedings.
The majority said the text was clear and outcome determinative. See slip op. at 16, 19-21. That aspect of Bruce should significantly influence future decisions. Employers arguing for a narrower reading will now have to overcome not just district-court authority in the Sixth Circuit and elsewhere, but a published, well-reasoned Circuit Court of Appeals opinion grounded in textual analysis.
To be sure, the opinion was 2-1, with Circuit Judge Amul R. Thapar dissenting. Judge Thapar’s opinions typically embrace textualism, and so one might assume his dissent would undermine the majority’s textual interpretation. But that does not appear to be so.
Judge Thapar’s dissent did not address the interpretation issue because, in his view, no hostile-work-environment claim was adequately pleaded. Slip op. at 22-25 (Thapar, J., dissenting). All three judges recognized that, if the hostile-work-environment claim was not adequately pleaded, then there would be no EFAA issue and the remaining claims would be subject to arbitration. Slip op. at 6, 25. It was therefore unnecessary for Judge Thapar to opine on whether the majority’s textualist interpretation was correct.
Sexual Harassment and Sexual Assault Claims: The Pleading Issue Is Now a Gateway EFAA-Applicability Question for Judicial Resolution
Bruce is not only about the scope of the EFAA. It also shows why, in an EFAA case, the sufficiency of the sexual-harassment or sexual assault allegations is effectively a question of arbitrability. (For more on questions of arbitrability, see here.)
The Sixth Circuit declined to decide what standard governs the EFAA’s requirement that the plaintiff “alleg[e] conduct constituting” a sexual-harassment or sexual-assault dispute. Some lower courts have treated that as essentially a Twombly/Iqbal plausibility inquiry; another has suggested a less demanding, nonfrivolous-basis standard. See slip op. at 8-9 (citations omitted). The Sixth Circuit left that debate for another day because Bruce’s allegations were sufficient even under the higher plausibility standard, and because Bruce herself had not argued for a lower one. Slip op. at 7-9.
Bruce does not settle the pleading-standard debate under the EFAA. But it does clarify that, at least where a plaintiff plausibly states a covered harassment claim, the EFAA can pretermit arbitration of the entire case. Because the EFAA expressly overrides any attempt to delegate EFAA-applicability questions to arbitrators, courts, not arbitrators, get to answer these questions, and delegation does not provide a workaround for arbitration proponents. See 9 U.S.C. § 402(b).
That means defendants will have strong incentives to attack the allegedly covered claims aggressively at the Rule 12 stage, and plaintiffs will have correspondingly strong incentives to plead those claims adequately.
Judge Thapar’s thoughtful dissent underscores the point. In his view, Bruce alleged only three specific, allegedly harassing comments during the relevant period at Firm B and then relied on what Judge Thapar considered to be conclusory assertions that the conduct was ongoing and inappropriate. His dissent opined that the complaint was inadequately pleaded under Title VII pleading rules and noted that, if the sexual-harassment claim were dismissed, the ADA claims would go to arbitration. See slip op. at 22-25. The dissent therefore showcases the practical battleground Bruce creates: in many mixed-claim cases, the motion to dismiss the covered harassment claim may effectively determine arbitrability.
What Bruce Does Not Decide
Bruce does not purport to answer to every EFAA question.
It does not hold that any complaint containing the words “sexual harassment” or “sexual assault” automatically defeats arbitration. The plaintiff still must allege a covered dispute sufficiently to survive whatever threshold standard applies. In Bruce, the court found that threshold satisfied. That may not be so in other cases.
Bruce also does not purport to address EFAA’s temporal questions. The statute applies only to disputes or claims that “arise or accrue” on or after March 3, 2022, and appellate courts have already wrestled with what those temporal terms mean. That was not the focus of Bruce but of the earlier Sixth Circuit opinion in Memmer v. United Wholesale Mortgage, LLC, 135 F.4th 398, 404–09 (6th Cir. 2025), and other cases. (See here.) (Judge Karen Nelson Moore, who wrote the Bruce opinion, also wrote the Memmer opinion, and Judge Thapar, who dissented in Bruce, also dissented in Memmer.)
The Court also did not decide the broader disagreement over whether EFAA applicability requires only a non-frivolous allegation or a plausibly-pled claim.
But Bruce narrows the field considerably. Within the Sixth Circuit, the once-open “case versus claim” question now has a clear answer: if a covered sexual-harassment or sexual assault dispute is sufficiently alleged, then at plaintiff’s option, the whole case stays in court.
Practical Implications for Companies, Employees, and Counsel in Cases Involving Sexual Harassment or Sexual Assault Allegations
For companies and in-house counsel, Bruce is a reminder that arbitration agreements are not reliably severable at the claim level in mixed-claim EFAA cases. A single viable sexual harassment or sexual assault claim may now keep related disability, retaliation, discrimination, wage, contract, or other employment claims in court if they are part of the same case. Employers should therefore review arbitration programs with realistic expectations about what they can and cannot accomplish after the EFAA. Just as important, employers should continue to invest in appropriate prevention, reporting channels, prompt investigations, and documented remedial action. Bruce makes employer forum risk more acute when a harassment allegation is both plausible and joined with other claims that do not involve EFAA covered disputes.
For outside defense counsel, Bruce increases the importance of early merits analysis. In the Sixth Circuit, a motion to dismiss the covered harassment claim is no longer simply a pleading-adequacy motion (albeit with arbitration waiver implications); it may determine whether the employer gets to arbitrate at all. Counsel should assess at the outset whether the harassment allegations are plausibly pleaded, whether they are properly attributable to the defendant employer, and whether non-covered claims may be vulnerable on other grounds in Court.
They should also pay careful attention to the extent to which the EFAA may modify or render inapplicable the post-Morgan/Sundance waiver calculus. For example, in the Sixth Circuit in particular, making a motion to dismiss on the merits may compel a waiver finding. (See our recent article concerning the Sixth Circuit’s Kloosterman case, in which Richard D. Faulkner, Esq., Charles “Chuck” Bennett, and the author, Philip J. Loree Jr., prepared and filed a “Brief of Arbitration Practitioners and Scholars as Amici Curiae in Support of Plaintiff-Appellant” (Dkt. #55). The author was the Sixth Circuit counsel of record for this amicus brief.)
Where the EFAA is implicated, the risk of waiving arbitration by making a motion to dismiss the EFAA covered claim(s) is not the proper focus. If the employer is going to arbitrate any of the claims in the case, it must knock out that EFAA claim and that is likely going to require a motion to dismiss the EFAA covered claim coupled with a motion to stay litigation and compel arbitration of the other claims. The key is getting the sexual harassment or sexual assault dispute out of the case so that arbitration of the other claims can be compelled. Of course, care must be taken to avoid waiving arbitration of the other claims, which could happen if the employer attempted to dismiss those other claims, rather than simply to stay litigation and compel arbitration of them.
For employees and plaintiffs’ counsel, Bruce confirms that the EFAA can be a powerful tool for employees who wish to keep all their claims in Court even though they agreed to arbitrate all or many of them. If a viable covered sexual-harassment dispute is well pleaded, the other claims in the suit may remain part of it. But Bruce also cautions plaintiffs not to rely on labels. The complaint should allege concrete facts about the who, what, where, and how of the harassment, enough to survive an early pleading attack. Plaintiffs’ counsel should also think carefully about joinder, timing, the universe of potential claims, and, what claims should from the outset be included in the suit, especially if the goal is to avoid arbitration of these claims.
For all counsel, Bruce reinforces a broader lesson from the EFAA’s first wave of cases: forum fights tend to be front-loaded.
Conclusion
In our earlier EFAA article, we noted that the EFAA’s reference to a “case” rather than a “claim” can prove decisive. Bruce drives that point home on the circuit court of appeals level. The Sixth Circuit has now held that, when a plaintiff plausibly alleges a covered sexual harassment dispute, the EFAA renders a pre-dispute arbitration agreement unenforceable as to the entire lawsuit, not just the harassment count. That is a substantial shift in employee leverage, pleading and Rule 12 strategy. For employers it signals increased case-management-related risk.
Employers should treat Bruce as an important development, not a technical one. Employees and their counsel should treat it as confirmation that the EFAA can keep single-lawsuit employment claims together in court, provided at least one is a well-pleaded sexual-assault or sexual-harassment dispute. And everyone drafting, enforcing, or resisting arbitration agreements in employment cases should assume that, in the Sixth Circuit, the EFAA entire-case rule has arrived and is probably here to stay.
It would not surprise the author if eventually a circuit split on the entire-case rule emerges. But the textualist nature of the Sixth Circuit’s reasoning may make it a poor candidate for a U.S. Supreme Court overruling. Time will tell (as it always does).
Contacting the Author
If you have any questions about this article, arbitration, arbitration-law, or arbitration-related litigation, then please contact Philip J. Loree Jr., at (516) 941-6094. PJL1@LoreeLawFirm.com.
Philip J. Loree Jr. is principal of the Loree Law Firm, a New York attorney who focuses his practice on arbitration and associated litigation. A former BigLaw partner, he has 35 years of experience representing a wide variety of corporate, other entity, and individual clients in matters arising under the Federal Arbitration Act, as well as in insurance- or reinsurance-related, and other, matters.
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