Enforcement of Forum-Selection Clauses in Federal Court After Atlantic Marine
Atlantic Marine
Matthew J. Sorensen 0 1
Recommended Citation
0 Fordham University School of Law
1 Matthew J. Sorensen, Enforcement of Forum-Selection Clauses in Federal Court After Atlantic Marine , 82
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TABLE OF CONTENTS
INTRODUCTION........................................................................................ 2523
2014]
INTRODUCTION
A large internet service provider makes the search records of more than
650,000 customers available for public download.1 These records are
subsequently distributed widely throughout the internet.2 They reveal
highly sensitive personal information, including the customers’ struggles
with sexuality, alcohol addiction, mental illness, physical abuse, domestic
violence, incest, adultery, and rape.3 The records also “contain[] addresses,
phone numbers, credit card numbers, social security numbers, passwords
and other personal information.”4 In response to this information breach,
two customers, suing as “Doe” plaintiffs to protect their anonymity, bring a
class action against the internet service provider in California federal court
seeking relief for all customers under a federal privacy statute and various
California consumer protection laws.5 The defendant, seeking to enforce a
forum-selection clause found in its standard customer agreement, brings a
motion to dismiss for improper venue pursuant to Federal Rule of Civil
Procedure 12(b)(
3
).6 If the motion is successful, the plaintiffs will be
compelled to bring their lawsuit in Virginia state court “where a class action
remedy would be unavailable to them”7 and could be forced to bring their
claims pursuant to Virginia law, which “provides significantly less
consumer protection to its citizens than California law.”8
This Note assesses the substantive law governing the validity and
enforceability of forum-selection clauses9 and procedural mechanisms for
enforcing such clauses in federal court. The U.S. Supreme Court, in
Atlantic Marine Construction Co. v. U.S. District Court,10 recently resolved
a circuit split on the use of 28 U.S.C. §§ 1404 and 1406, relating to
“Change of Venue” and “Cure or waiver of defects” in venue, respectively,
and Rule 12(b)(
3
), relating to the enforcement of forum-selection clauses.
Missing from the narrow debate before the Court in Atlantic Marine,
however, was discussion of a broader circuit split concerning the validity
and enforcement of forum-selection clauses.11
Prior to Atlantic Marine, there was no meaningful consensus among the
circuits concerning the standard for determining the validity and
enforceability of forum-selection clauses or the proper procedural
mechanisms for enforcement.12 While Atlantic Marine has provided some
clarification, the remaining multifaceted circuit splits implicate
longstanding federalism concerns,13 threaten to confuse litigators and
courts, and jeopardize parties’ substantial litigation and contractual rights in
federal court.14
Part I of this Note begins with an overview of the importance of
forumselection clauses to contracting parties. These provisions assist parties in
allocating the risk of litigating in a given jurisdiction before contractual
disputes arise and thus increase predictability and efficient resolution of
such disputes.15 The overview also explores the difference between
socalled “mandatory” and “permissive” forum-selection clauses,16 how they
interact with choice-of-law agreements, and how federal courts interpret the
scope and meaning of such provisions.17 Part I includes a discussion of the
Supreme Court’s forum-selection clause jurisprudence. This discussion
begins with the Court’s historic refusal to give effect to forum-selection
clauses, traces how that refusal was grounded in the “ouster doctrine,”18 and
examines its subsequent abandonment by the Supreme Court in The Bremen
v. Zapata Off-Shore Co.19 Part I.B discusses the Court’s holdings in The
Bremen, Stewart Organization, Inc. v. Ricoh Corp.,20 and Carnival Cruise
Lines, Inc. v. Shute,21 which led to widespread disagreements among lower
2014]
federal courts concerning the enforcement of forum-selection clauses.22 It
concludes with a discussion of Atlantic Marine,23 which resolved some—
but far from all—of these disagreements and altered the standard of
enforcement of forum clauses through the federal common law24 doctrine
of forum non conveniens and § 1404(a).25
Part II explains the disagreements that remain among lower courts
concerning the enforcement of forum-selection clauses. First, it discusses
the split among federal courts concerning the application of federal or state
law to determine the validity and enforceability of forum-selection
clauses.26 Part II concludes by discussing the viability of enforcing
forumselection clauses via Federal Rules of Civil Procedure 12(b)(
6
), 12(c), and
5627 and explores the implications of this approach alongside Atlantic
Marine’s newly a (...truncated)