Court says University of Michigan Health-West can’t switch battlefields after losing its first swing in court
August 27, 2025 — The Sixth Circuit Court of Appeals delivered a sharp rebuke to University of Michigan Health-West, telling the hospital it cannot run from a lawsuit it already tried to kill. After more than a year of hard litigation, the hospital attempted to slam the door on open court and shuffle the dispute into arbitration. The judges said no. Too late. You don’t get two bites of the apple.
Valerie Kloosterman, a physician assistant who started at Metropolitan Hospital back in 2004, says she was thrown out in 2021 for refusing to use gender-identity pronouns or refer patients for transition procedures. She cited her Christian faith and her medical judgment. What followed was a clash with hospital administrators who, according to her, told her she “could not take the Bible or her religious beliefs to work” and branded her “evil.” Not long after, she was out the door.
When she sued in 2022 under Title VII, §1983, and Michigan law, the hospital answered with fire. It pushed for a total dismissal “with prejudice.” Twice. If it had succeeded, the case would have been buried—no arbitration, no jury, no second act. But the district judge allowed some of her First Amendment and Title VII claims to live. That’s when the hospital changed its tune, pulled an old contract out of the drawer, and demanded arbitration.
Judge Eric Murphy wrote the opinion that cut that strategy off at the knees. Once you ask a court for a knockout punch on the merits, you’ve abandoned your promise to arbitrate. The Federal Arbitration Act doesn’t let you hedge bets. In Murphy’s words, defendants can’t “play heads I win, tails you lose.”
The concurrences dug into legal hair-splitting over whether this is “waiver,” “forfeiture,” or just “default.” The labels don’t change the result. The hospital went all-in on dismissal, lost, and tried to retreat. The Sixth Circuit shut the door.
So the case marches back to Michigan. Kloosterman’s Free Exercise, Equal Protection, and Title VII claims will move forward in federal court. No trial date yet, but the wheels of discovery will grind again—documents, depositions, and the long grind of litigation. The big question remains: was her firing about policy, or was it punishment for her beliefs? That’s no longer a private arbitration matter. That fight will play out in the open.
Tags: Sixth Circuit, arbitration, Title VII, religious discrimination, University of Michigan Health-West
Link to the opinion (PDF): Sixth Circuit, Valerie Kloosterman v. Metropolitan Hospital (University of Michigan Health-West), Case No. 24-1398, File: 25a0239p.06
https://www.opn.ca6.uscourts.gov/opinions.pdf/25a0239p-06.pdf
