Investigate to Mitigate: Lessons from Bruce v. Adams & Reese
The U.S. Court of Appeals for the Sixth Circuit ruled on February 25, 2026, that the federal Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (EFAA) bars arbitration of an entire lawsuit that relates to a sexual harassment dispute, not just the harassment claim. In Bruce v. Adams & Reese LLP, the court affirmed a district court’s refusal to compel arbitration of Americans with Disabilities Act (ADA) claims where the plaintiff also adequately pleaded sexual harassment under Title VII of the Civil Rights Act of 1964.
This first‑impression decision underscores a practical reality for employers: mandatory arbitration is not a panacea for workplace disputes. A single, well‑pleaded sexual harassment or assault claim can keep the entire case in court. The ruling highlights the importance of robust policies and training, credible reporting channels, and proactive investigations to address issues before they escalate into litigation that arbitration cannot capture.
Background
In her complaint, paralegal Randi Marie Bruce alleged that a supervising attorney at Adams & Reese LLP subjected her to a persistent pattern of sexually charged conduct, including comments, jokes, and inappropriate remarks, and that the conduct continued through the end of her employment. She also alleged that, after her work schedule was changed, she experienced disability-related difficulties and was terminated when she could not meet the new attendance requirements. Bruce brought claims under Title VII for sexual harassment and under the ADA for failure to accommodate and retaliation.
At the time of hire, Bruce signed an arbitration agreement requiring her to arbitrate all employment-related disputes. The EFAA, however, provides that if an arbitration agreement was signed before a dispute arose, any case relating to sexual assault or sexual harassment may not be compelled to arbitration. Instead, unless the employee agrees to arbitration, such a case must proceed in court.
After Bruce filed suit, Adams & Reese moved to dismiss the sexual harassment claim and to compel the ADA claims to arbitration. The U.S. District Court for the Middle District of Tennessee denied both motions. Adams & Reese LLP appealed to the Sixth Circuit Court of Appeals.
The Appellate Court Decision
In a 2-1 decision, the Sixth Circuit affirmed the lower court. With respect to the harassment claim, the Court held that Bruce alleged enough facts to state a plausible Title VII hostile work environment claim, so that cause of action could not be compelled to arbitration under the EFAA. The Court emphasized that a complaint need not include a play-by-play of every instance of misconduct at the pleading stage.
The more significant ruling concerned the scope of the EFAA. Since the EFAA bars enforcement of arbitration agreements “with respect to a case” that relates to sexual harassment or assault, the Sixth Circuit interpreted “case” to mean the entire civil action, not individual claims. As a result, once a sexual harassment or assault claim is plausibly alleged (and survives an early motion to dismiss if filed), every other cause of action in the same lawsuit stays in court, including discrimination, retaliation, wage and hour, contract, and other claims that are part of the action. Severability clauses and motions to compel partial arbitration do not change this outcome.
Key Takeaways
This decision resets the arbitration and workplace‑investigation landscape in the Sixth Circuit (which covers Kentucky, Michigan, Ohio, and Tennessee). When sexual harassment and/or sexual assault is plausibly alleged, the EFAA renders pre‑dispute arbitration agreements unenforceable for the entire case, unless the employee agrees to arbitrate those claims. So non‑harassment/assault claims cannot be carved out. Employers should prepare for unified court litigation, broader discovery, public filings, and potential jury trials.
To reduce that risk, employers should prioritize prevention and early resolution by preparing, publishing, and implementing robust anti-discrimination policies, establishing clear reporting channels, conducting timely and impartial investigations, delivering effective anti-harassment training, and taking prompt and appropriate remedial action. For practical guidance on intake and investigations, see our prior client alerts, “Strategies for Ensuring Effective Workplace Investigations” and “From Concern to Case File: Determining When to Investigate a Workplace Complaint.”
