Atlantic Marine and Choice-of-Law Federalism
Andrew D. Bradt
Volume 66, Issue 3, 617-42
The headline holding of the Supreme Court’s opinion in Atlantic Marine is its conclusion that a forum-selection clause is usually enforceable under the federal transfer statute, 28 U.S.C. § 1404(a). Also lurking within the opinion, however, is a significant shift in the Court’s approach to choice of law in federal courts. In Atlantic Marine, the Court held that after a transfer to enforce a forum-selection clause, the transferee district court must apply the choice-of-law rules of the state in which it sits. The Court’s rationale is straightforward—the plaintiff should not be allowed to flout the forum-selection clause and obtain the benefits of more favorable choice-of-law rules of another state. But the Court’s new rule is a departure from its prior treatment of choice of law in transfer cases, which provided that after a § 1404(a) transfer the transferee court must apply the choice-of-law rules of the transferor court, which, in diversity cases, means the choice-of-law rules of the state in which the transferor court sits. This rule was based on several longstanding principles of what I call choice-of-law federalism, which itself is premised on respect for the substantive policies underlying states’ choice-of-law rules and the refusal to sanction different applicable law in federal and state courts within the same state—even in the face of evident interstate forum shopping by plaintiffs. This Article examines how the Court’s abandonment of these principles creates numerous complications in its jurisprudence under the Erie doctrine and in choice of law.
Governing Law on Forum-Selection Agreements
Kevin M. Clermont
Volume 66, Issue 3, 643-74
The task of determining which law governs a contractual choice-of-forum clause is an enigma to courts. The key to its solution lies at the very heart of the subject, where one encounters its most celebrated riddle: Which law governs when the parties have also agreed to a choice-of-law clause—that is, does a court first test the forum-selection clause under the law of the seised forum, or does one first look at the parties’ choice of law to apply the chosen law to the forum-selection clause?
This chicken-or-egg mystery throws courts into contortions. Prior commentators have opted for the chosen law. But differentiated cases, policy arguments, and doctrinal consistency all support applying lex fori to enforceability of the forum-selection agreement—while applying the chosen law as to the agreement’s interpretation or, in the absence of a choice-of-law clause, the chosen court’s law.
Atlantic Marine and the Future of Party Preference
Volume 66, Issue 3, 675-92
In Atlantic Marine, the Supreme Court held that a prelitigation forum-selection agreement does not make an otherwise proper venue improper. Prominent civil procedure scholars have questioned the wisdom and accuracy of this holding. In this paper, I defend Atlantic Marine as essentially correct based on what I have elsewhere called the principle of party subordinance. I go further, however, to argue that the principle underlying Atlantic Marine could affect the widespread private market for prelitigation agreements, with significant commercial and doctrinal repercussions.
Atlantic Marine and the Future of Forum Non Conveniens
Volume 66, Issue 3, 693-718
This Article explores the impact of the Supreme Court’s unanimous opinion in Atlantic Marine Construction Co. v. U.S. District Court on forum non conveniens doctrine. Although Atlantic Marine concerned a § 1404(a) transfer within the federal system, and therefore does not directly address forum-selection clauses pointing to foreign forums, the case will undoubtedly have an impact on how courts treat forum-selection clauses that point to a foreign forum. In this Article, I argue that the Atlantic Marine opinion relies on a strict coupling of § 1404(a) and forum non conveniens for its holding. As a result, lower courts will be more likely to conflate these two doctrines that had been slowly but surely developing on parallel tracks. This Article explains why merging or conflating § 1404(a) and the forum non conveniens doctrine is problematic, both as a general matter and as applied to the specific context of forum-selection clauses. It also demonstrates that the Court’s blunder is symptomatic of problems inherent in current interpretations and applications of the § 1404(a) and forum non conveniens doctrines.
Gaming the System: Protecting Consumers from Unconscionable Contractual Forum-Selection and Arbitration Clauses
Linda S. Mullenix
Volume 66, Issue 3, 719-60
The Supreme Court’s 2013 decision in Atlantic Marine v. U.S. District Court perhaps usefully resolved the issue of the appropriate procedural means for ascertaining the proper court where the parties’ agreement includes a forum-selection clause. However, the Court’s decision was predicated on the presupposition that the forum-selection clause was valid—a presupposition that begged that threshold question. Thus, the Court’s presupposition threw a significant set of antecedent questions into legal limbo, namely: (1) what body of law applies to evaluate the validity and enforceability of a forum-selection clause, (2) what court should make that determination, and (3) when should that determination be made? This Article explores the problem of forum-selection, choice-of-law, and arbitration clauses in the context of the federal courts’ longstanding fixation on the problem of creative forum-shopping and other gamesmanship to gain litigation advantage, strategies the courts have long eschewed. Nonetheless, despite the concerted efforts of courts and legislators to thwart such techniques through judicial fiat and legislative enactment, actors in the judicial arena continue to invent resourceful methods to circumvent new constraints. This Article argues that consumer forum-selection and arbitration clauses ought to be viewed through the lens of litigation gamesmanship, as procedural means whereby corporate defendants are able to establish forum advantage without any countervailing benefit to consumers who unwittingly agree to such clauses. The Court consistently has turned a blind eye and deaf ear on the problem of consumer forum-selection and arbitration clauses, instead merging consideration of consumer agreements with jurisprudence developed in the dissimilar context of sophisticated business partners freely negotiating at arm’s length. The Court’s continued failure to distinguish and address the problem of consumer forum-selection and arbitration clauses—left unchanged or worsened by Atlantic Marine—calls for legislative action to close this legal advantage conferred on corporate defendants who exploit it to their economic benefit.
Five Questions After Atlantic Marine
Stephen E. Sachs
Volume 66, Issue 3, 761-76
The Supreme Court’s ruling in Atlantic Marine did a lot to clear up the law of forum selection. But it also left a number of live questions in place. This Article briefly discusses five of them. When a party wants to move a case to the selected forum, what procedures can it use, other than venue transfer or forum non conveniens? When is a forum-selection clause valid and enforceable, as a matter of state or federal law? If the clause isn’t valid, should a federal court still give it any weight? What happens if there are multiple parties or claims, and the clause applies to some but not others? And what do the Court’s new standards mean for parties appealing a forum-selection ruling, either before or after a final judgment? Judges are already wrestling with these questions, but the answers aren’t easy—and may well require another trip to the Supreme Court.
Enforcing Forum-Selection Clauses
Bradley Scott Shannon
Volume 66, Issue 3, 777-94
In Atlantic Marine Construction Co. v. U.S. District Court, the Supreme Court created a scheme for the enforcement of contractual forum-selection clauses in federal courts. But the Court’s scheme, which relies heavily on the use of federal venue transfer statutes and the doctrine of forum non conveniens, is highly problematic. The relevance of federal venue statutes for this purpose seems questionable, and the use of such statutes results in an unduly complicated analysis that fails to capture all relevant considerations in this context. The Court’s reliance on federal venue statutes also prevents state courts faced with similar issues from utilizing the same mode of analysis. Simply enforcing forum-selection clauses by their terms through a motion to dismiss would result in a simpler, more just, and more universal solution to this problem.
Atlantic Marine Through the Lens of Erie
Adam N. Steinman
Volume 66, Issue 3, 795-822
The Supreme Court’s unanimous decision in Atlantic Marine clarified several things about the enforcement of forum-selection clauses in federal court. But something important was missing from Justice Alito’s opinion—the Erie doctrine. Erie, of course, helps to determine the applicability of state law in federal court, and state law potentially has a lot to say about contractual forum-selection clauses. Indeed, Erie was front and center the last time the Court confronted the enforcement of forum-selection clauses in federal court, when it decided Stewart Organization v. Ricoh a quarter century ago.
This article examines the Atlantic Marine decision through the lens of Erie, and explores the role that Erie and state law should play in the Atlantic Marine framework. Atlantic Marine may appear at first glance to mandate virtually unflinching enforcement of forum-selection clauses. But Justice Alito’s approach in Atlantic Marine applies only when the forum-selection clause is “contractually valid.” Properly understood, Erie requires federal courts to look to state law to decide this question—at least in diversity cases. To allow federal courts to disregard state law in applying Atlantic Marine would raise several troubling Erie concerns: geographic relocation contrary to what would occur in state court; changing the substantive law that would govern the ultimate merits of the litigation in state court; and overriding state contract law and contractual remedies via the sort of federal common law that Erie forbids.
Judicial Review of the Equal Employment Opportunity Commission’s Conciliation Efforts
Nicole E. Teixeira
Volume 66, Issue 3, 823-44
On June 30, 2014, the Supreme Court granted certiorari in Mach Mining, LLC v. Equal Employment Opportunity Commission (“EEOC”). The issue before the Court is “[w]hether and to what extent [a court may] enforce the EEOC’s mandatory duty to conciliate discrimination claims before filing suit.” The Court’s decision will likely resolve a three-way circuit split on how the EEOC’s conciliation efforts may be reviewed: currently, the Second, Fifth, and Eleventh Circuits require the EEOC to meet a searching three-step test, while the Fourth, Sixth, and Tenth Circuits apply a more deferential “good faith” standard. The Seventh Circuit created the third split with its decision in Mach Mining. It stands alone in holding that the failure to conciliate is not an implied affirmative defense and there is no judicial review of conciliation. This Note argues that the Supreme Court should resolve the circuit split in favor of the good faith standard, adopting a procedural rather than substantive form of review.
Righting the Wrong of Publicity: A Novel Proposal for a Uniform Federal Right of Publicity Statute
Alex J. Berger
Volume 66, Issue 3, 845-70
The Ninth Circuit’s decision in In re NCAA Student-Athlete Name & Licensing Litigation highlights the enlargement of protection of celebrities’ “identities” under California’s right of publicity scheme. A comparison of California’s and New York’s right of publicity laws exposes the wider issues that cause confusion and uncertainty regarding right of publicity throughout the country. Such issues include ambiguous definitions of “identity,” conflicts with federal copyright law, jurisdictional problems, and First Amendment free speech issues. This Note explores the roots of right of publicity law and how its current forms foment disarray across the nation. Paying particularly close attention to California and New York, where right of publicity cases are rife, and the law varies greatly, this Note argues for a uniform federal right of publicity statute. Further, this Note sets out a novel approach for a statute that incorporates the original economic rationale behind right of publicity law and a number of carve outs designed to protect artists’ First Amendment rights. Such a statute would inject much needed uniformity and fairness into a fractured system.