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Tuesday, March 31, 2015

Atlantic Marine, Forum-Selection Clauses & Erie

I started off this month talking about Erie, so here’s another Erie post to bring things full circle. Back in the fall, I was glad to participate in the Hastings Law Journal’s symposium on last Term’s SCOTUS decision in Atlantic Marine Construction Co. v. United States District Court. Atlantic Marine was a unanimous decision—authored by Justice Alito—on how and when to enforce forum-selection clauses in federal court. It’s a set of issues that only a civil procedure professor could love, and if you teach civil procedure Atlantic Marine may already be on your syllabus.

The symposium issue is now out. You can find links to all of the articles here, including contributions by Andrew Bradt, Kevin Clermont, Scott Dodson, Robin Effron, Linda Mullenix, Steve Sachs, and Brad Shannon. My piece is Atlantic Marine Through the Lens of Erie, and here’s the abstract:

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 for the Hastings Law Journal’s symposium on Atlantic Marine examines that 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.

My thanks once again to the students, organizers, and panelists, as well as to the DJ who was able to find some Rod Stewart tracks without any advance notice. I learned a lot and had a great time.

[Cross-posted at the Civil Procedure & Federal Courts Blog]

Posted by Adam Steinman on March 31, 2015 at 03:49 PM in Civil Procedure | Permalink


Adam? Still there, Adam?

Posted by: Gloober | Apr 1, 2015 4:01:49 PM

No, it doesn't. Not at all.

But you didn't answer my question. (You'd be a good hostile deponent.)

Posted by: Gloober | Apr 1, 2015 12:56:24 PM

Does footnote 24 of Burger King suggest that federal courts should not apply state contract law?

Posted by: Adam | Apr 1, 2015 12:32:57 PM

Isn't the (rather banal) point in your paper that federal courts interpreting contracts must apply state contract law, at least when sitting in diversity jurisdiction?

Posted by: Gloober | Apr 1, 2015 12:26:21 PM

I'll probably regret taking the bait on this one, but what is the connection between the arguments I'm making in the paper and footnote 24 of Burger King? Are you suggesting that footnote 24 imposed a federal approach to enforcing choice-of-law provisions?

Posted by: Adam | Apr 1, 2015 12:10:28 PM

Really? You're not sure you "follow"? Sad.

(Here's a hint: Read Burger King's footnote 24. See if you can follow that.)

Posted by: Gloober | Apr 1, 2015 11:36:26 AM

Carnival Cruise was an admiralty case, so there was a basis for federalizing the issue there. As for Burger King, I'm not sure I follow. Burger King found that jurisdiction was proper in a Florida state court, so under FRCP 4(k)(1)(A) it was also proper in a Florida federal court.

Posted by: Adam | Apr 1, 2015 9:17:57 AM

Howard --


Posted by: Gloober | Mar 31, 2015 6:43:39 PM

Burger King wasn't a forum-selection provision, it was a choice-of-law provision.

Posted by: Howard Wasserman | Mar 31, 2015 5:39:02 PM

Why stop with Atlantic Marine? Why not add Carnival Cruise and Burger King too?

Posted by: Gloober | Mar 31, 2015 5:14:57 PM

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