Location, Location, Location: Drafting Enforceable Forum-Selection Clauses under Atlantic Marine

IADC Toxic and Hazardous Substances Litigation Committee Newsletter

Following the Supreme Court's decision in Atlantic Marine Construction Company, Inc. v. United States District Court for the Western District of Texas, 134 S. Ct. 568 (2013), forum-selection clauses in contracts appeared ironclad and impossible to circumvent in federal court. After all, in Atlantic Marine, the Court held that "a valid forum-selection clause [should be] given controlling weight in all but the most exceptional cases" and will be enforced under the transfer provisions of 28 U.S.C. § 1404(a). Id. at 579, 581-82. 

Over the last year, however, some lower courts have chipped away at the seemingly impenetrable shield that Atlantic Marine afforded to forum-selection clauses challenged in federal court. The recent decisions that distinguish and decline to enforce forum-selection clauses under Atlantic Marine offer valuable lessons to practitioners on "what not to do" when counseling clients and drafting forum-selection clauses. 

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