Earlier this May, the Fourteenth Court of Appeals, held that a federal law, the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (“EFAA”) that went into law in March 2022, barred a requirement of a former nurse to arbitrate claims connected to her termination after reporting that a patient sexually and inappropriately touched her.

In SJ Medical Center, LLC dba St. Joseph Medical Center v. Olanma Destiny Anozie, Anozie worked at St. Joseph’s Center for Behavioral Health (“St. Joseph”) as a registered nurse. In December 2022, as Anozie was walking past a mental health patient suffering from schizoaffective disorder, among other ailments, allegedly assaulted her by slapping her “buttock area” and yelled racial slurs at her. Anozie reported the incident to her manager. A week later, St. Joseph terminated Anozie’s employment. Anozie sued St. Joseph for retaliation, alleging that she was wrongfully terminated because she reported a violation of law.

St. Joseph moved to compel arbitration and proffered an arbitration agreement signed by Anozie in June 2021, in which she agreed to arbitrate all claims or controversies that otherwise would be resolved in a court of law or before a forum other than arbitration, including claims or disputes arising out of or related to termination of employment. Anozie opposed arbitration based on the EFAA, which declares that, at the option of a person alleging conduct constituting a sexual assault dispute or sexual harassment dispute, pre-dispute arbitration agreements are unenforceable as to certain cases that relate to the alleged sexual assault dispute or sexual harassment dispute. The trial court denied St. Joseph’s motion to compel arbitration.

On appeal, St. Joseph’s argued the EFAA didn’t apply to Anozie’s suit because she only brought state law claims of retaliation, not sexual misconduct. But, the Fourteenth Court of Appeals disagreed since the sexual misconduct was integral to Anozie’s retaliation claim, stating, “[g]iven that her case involves only one claim for retaliation under Texas state law that is premised on the contention that she was terminated for reporting that she was a victim of a sexual assault, we have no difficulty in concluding that her case relates to the sexual assault dispute alleged,” and therefore, the EFAA applied and barred the arbitration agreement.

St. Joseph further argued that Anozie’s claim did not rise to the level of sexual assault under Texas law, so the EFAA did not apply. The Court of Appeals again disagreed, explaining that Anozie showed enough to establish a nonconsensual sexual act made against her under federal law, which was sufficient to have the EFAA apply to her case. In assessing whether Anozie’s retaliation claim is a dispute “involving” that sexual contact for which the EFAA would bar arbitration, the three justice panel found that the EFAA covers disputes that will require proof that a plaintiff was a victim of a nonconsensual sexual act or sexual contact — and Anozie’s claim, while concentrated on retaliation, is included in that scope given that the court will need to review the incident that allegedly led to her firing.

In coming to its judgment, the Court stated, “Congress has determined that victims of sexual harassment and sexual assault should have the option to invalidate arbitration agreements in certain cases . . . Having made this policy decision, it would be rational for Congress to include within the class of persons who may exercise that option sexual assault victims who are allegedly fired for reporting the assault to their employers.”

The attorneys in our Austin and Dallas office have extensive experience advising clients about employment matters. Please contact us at info@gstexlaw.com with any questions you may have.

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