The Supreme Court agreed to review the Fifth Circuit’s decision in In reAtlantic Marine Construction Co., Inc.,701 F.3d 736 (5th Cir. 2012), cert. granted, 133 S. Ct. 1748 (U.S. 2013) (No. 12-929), which denied a mandamus request to dismiss or transfer the case pursuant to a contractual forum selection clause. Plaintiff brought its suit for breach of contract in a Texas federal court, notwithstanding a provision in the contract requiring that the state or federal courts of Virginia would be the exclusive forum for litigating disputes. Both the district court and Fifth Circuit declined to dismiss or transfer the case. The Fifth Circuit held that a forum selection clause in a private contract generally cannot trump Congress’ determination of where venue lies, and therefore it does not render venue improper in a district in which venue is otherwise proper under federal law. Thus, in situations where the forum in which suit was filed is proper under the federal venue statutes, and the forum selection clause designates an alternative federal forum, dismissal is not warranted under either Rule 12(b)(3) or 28 U.S.C. § 1406. Instead, the proper procedural tool to apply is the test for transferring a case under 28 U.S.C. § 1404(a). Applying § 1404(a), the court ruled that the district court did not clearly abuse its discretion in finding that a transfer would not serve the interests of justice or the convenience of the parties and witnesses. The Supreme Court will address whether the § 1404(a)’s discretionary, balancing-of-conveniences test applies in such circumstances.
Register now for your free, tailored, daily legal newsfeed service.
Questions? Please contact email@example.comRegister
Supreme Court to address proper test for forum selection clauses
If you would like to learn how Lexology can drive your content marketing strategy forward, please email firstname.lastname@example.org.
Related topic hubs
"Lexology is excellent and I look forward to reading it each day. It’s great!”