A judge ruled Wednesday the case should be heard through private arbitration rather than in public court.
He said Sheen's contract requires any disputes to be handled through private arbitration.
Sheen filed a $100 million lawsuit in March after he was fired from his hit TV show, "Two and a Half Men."
Warner Bros. welcomed the ruling.
Sheen's attorney says he will continue to argue the case should be heard publicly.
"Charlie Sheen brought this suit to be adjudicated because he's owed a significant amount of money," said Sheen's attorney, Marty Singer. "Not only did WB fail to pay him for the eight episodes of this season, but also didn't paid him the back-end compensation for all work he did in the past."