One sexual harassment claim is the off switch for an entire arbitration agreement

"Making a mountain out of a molehill."

That's what TransDigm's then-CEO allegedly told its general counsel when she raised a pattern of sexual assault and harassment at the company's management meetings. An Ohio appellate court just sent her entire case to a courtroom instead of an arbitrator.

The allegations in Warren v. TransDigm Group are ugly. Jessica Warren says an operating unit president followed her to her hotel room in 2021 and tried to kiss her. In 2023, another kept dancing with her until a male executive stepped in. In 2024, a third choked her from behind, kissed her face, and smacked her hip and backside in front of coworkers.

She reported 2021 and 2024. Both men were fired. She alleges each still got a substantial severance package, with no contract requiring one.

She also alleges that CEO Michael Lisman asked what she did to cause the 2024 assault and why it took so long to report. He allegedly told her that he doubted a woman with a family could be general counsel. He called harassment training a "waste of time." And in July 2025, she was told she'd be replaced by "an objectively less qualified male."

Warren sued. The trial court dismissed her discrimination, harassment, and retaliation claims, and stayed the rest of the case, including a breach of contract claim, under the arbitration clause in her employment agreement.

The appellate court reversed. The Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act lets a person alleging harassment elect court over a predispute arbitration agreement. If the harassment claim survives a motion to dismiss, it is "by definition nonfrivolous," and the EFAA applies.

Warren's survived. TransDigm argued that firing both men was corrective action and that the conduct wasn't severe or pervasive. The court called those proof questions, not pleading questions. The retaliation claim survived too.

Then the kicker. The EFAA doesn't just free the harassment claims. The agreement is unenforceable as to the entire case. Thus, even a claim for breach of the very agreement that contains the arbitration clause is not arbitrable and must be heard in court.

So here's my bigger question: do you really want arbitration anyway? Businesses favor arbitration for privacy, speed, lower fees, and less risk of a jackpot jury verdict. In my experience, however, it doesn't limit discovery, shorten the case, cut the expense, or hedge your risk. In fact, because you pay for the arbitrator's time, it often costs more.

If privacy matters most to your business, by all means keep using arbitration clauses. Just know that one sexual harassment claim is going to shred that agreement. 

Otherwise, before you put a broad arbitration clause in your next agreement, consider a jury-trial waiver instead, which at least hedges against a runaway jury.

Arbitration promises privacy. It rarely delivers anything else, assuming its it's enforceable in your case at all. And if it rarely delivers, why require it in the first place?