Atlantic Marine Const. Co., Inc. v. U.S. Dist. Court for W. Dist. of Texas

Atlantic Marine Const. Co., Inc. v. U.S. Dist. Court for W. Dist. of Texas, 12-929, 2013 WL 6231157 (U.S. Dec. 13, 2013)  The appropriate way to enforce a forum-selection clause pointing to a state or foreign forum is through the doctrine of forum non conveniens, not a motion to dismiss pursuant to § 1406(a) or FRCP Rule 12(b)(3), because a forum-selection clause does not render venue in a court “wrong” or “improper.” 

Section 1404(a)   codifies the doctrine of forum non conveniens for the subset of cases in which the transferee forum is within the federal court system; for the remaining set of cases calling for a nonfederal forum, § 1404(a) has no application, but the residual doctrine of forum non conveniens has continuing application in federal courts.  And because both § 1404(a) and the forum non conveniens doctrine entail the same balancing-of-interests standard, courts should evaluate a forum-selection clause pointing to a nonfederal forum in the same way that they evaluate a forum-selection clause pointing to a federal forum.  Ordinarily, the district court would weigh the relevant factors and decide whether, on balance, a transfer would serve “the convenience of parties and witnesses” and otherwise promote “the interest of justice.”  The calculus changes, however, when the parties' contract contains a valid forum-selection clause. The enforcement of valid forum-selection clauses protects the parties’ legitimate expectations and furthers vital interests of the justice system. For that reason, and because the overarching consideration under § 1404(a) is whether a transfer would promote the interest of justice, a valid forum-selection clause should be given controlling weight in all but the most exceptional cases.  First, the plaintiff's choice of forum merits no weight.   Second, a court should not consider arguments about the parties' private interests.  As a consequence, a district court may consider arguments about public-interest factors only. Third, where a defendant's motion is premised on enforcement of a valid forum-selection clause, the law of the court in which the plaintiff inappropriately filed suit should not follow the case to the forum contractually selected by the parties.

April 2021