An Oregon ruling just changed what HR has to prove before naming an owner in a harassment case
Oregon's appeals court just narrowed when bosses can be personally on the hook for workplace harassment – and policy oversight alone is not enough.
On May 13, 2026, the Court of Appeals of the State of Oregon reversed a state labor agency ruling that had pinned aider-and-abettor liability on Todd Mitchell, an owner of Frehoo, Inc., for sexual harassment at the company's Stars Cabaret & Steak House. The court said a negligence-style test – whether an owner ought to have anticipated harassment – is not enough. Owners and executives have to know about the harassment, or have clear notice of it, before they can be liable personally under Oregon's anti-discrimination statute.
The underlying facts are disturbing. According to the decision, Frehoo hired a 15-year-old child sex trafficking victim, referred to as AP2, as a dancer. Customers touched her sexually at the club. A bartender recognized her from a missing persons photo and reported it to a manager and to Mitchell. The decision says Mitchell directed the club's general manager to contact law enforcement immediately.
The Oregon Bureau of Labor and Industries (BOLI) found Frehoo liable for creating a hostile work environment under ORS 659A.030(1)(b). That corporate finding is not disturbed by the appeal. BOLI also found Mitchell personally liable under former ORS 659A.030(1)(g) (2021), Oregon's aider-and-abettor provision. Its...
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