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Choice of forum clause

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Overview Edit

A choice of forum clause (also called a forum selection clause) is a contractual provision which predetermines the forum for any dispute involving the contract. Usually, the forum will be one that is convenient to one of the parties.

Forum selection clauses are prima facie valid, and are enforceable absent a strong showing by the party opposing the clause "that enforcement would be unreasonable or unjust, or that the clause [is] invalid for such reasons as fraud or overreaching."[1]

The bar for establishing the unreasonableness of a forum selection clause is high:

A forum selection clause is unreasonable if (1) its incorporation into the contract was the result of fraud, undue influence, or overweening bargaining power; (2) the selected forum is so gravely difficult and inconvenient that the complaining party will for all practical purposes be deprived of its day in court; or (3) enforcement of the clause would contravene a strong public policy of the forum in which the suit is brought.[2]

Sample Clause Edit

In the event of any dispute concerning this Agreement or the products [services] sold [licensed] hereunder, suit may be brought only in a court of competent jurisdiction in the State [Province][Country] of _____________.

References Edit

  1. Manetti-Farrow, Inc. v. Gucci America, Inc., 858 F.2d 509, 514 (9th Cir. 1988) (full-text) (quoting M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 15 (1972)) (modification in original).
  2. Argueto v. Banco Mexicano, S.A., 87 F.3d 320, 325 (9th Cir. 1996) (full-text) (internal citations and quotation marks omitted).

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