Hermann Goering, the founder of the Gestapo, acquired a portrait of a lady as Diana, wounded by Cupid, by the middling 18th-century painter Louis-Michel van Loo, in 1939. Exactly how Goering acquired the work is unclear, but you can imagine. The picture appeared at a Sotheby's auction in 2004 and was bought for US$96,000 by Steven Brooks. When Brooks later wanted to sell it at Christie's, he was informed of the painting's dubious provenance and the uncertain circumstances under which it was acquired by Goering. The auction house said it could not help to sell it, given its questionable history. So back to Sotheby's, which wouldn't sell it either -- or refund the purchase price. Brooks sued Sotheby's in California, alleging unfair and deceptive trade practices under the California Consumers Legal Remedies Act (CLRA), fraudulent concealment, negligent misrepresentation and unjust enrichment. Sotheby's pointed to the forum-selection clause in the terms of sale found in the auction catalogue, which gave jurisdiction over all disputes arising from the sale to the English courts. Brooks countered with a provision of the CLRA which precludes removal of a case to a foreign forum where to do so would violate public policy (consistent with the position at common law). Brooks argued that enforcing the forum-selection clause would violate public policy by requiring him to waive CLRA remedies and a jury trial.
The district court in San Francisco enforced the clause in the catalogue: Brooks v Sotheby's (ND Cal, 1 July 2013). Brooks failed to show that he had waived any remedies available under the CLRA, as an English court might well decide the dispute was governed by California law and apply that; and a jury trial remained a possibility even if the forum was England. Seeborg J thought the forum-selection clause a perfectly reasonable one, given that Sotheby's does business in 40 countries in 10 global salesrooms with customers from all over the world; the provision was a reasonable way to manage litigation. The clause had been reasonably communicated to Brooks: no auction virgin, he had made 32 previous purchases at Sotheby's, and would have had 'a large incentive to study' the terms of sale of a big-ticket item.