Forum Selection Clause

Table of Contents________________________________________

Overview 3

Issue 4

Rule 4

Analysis 5

America Online, Inc. v. Pasieka 5

Bremen v. Zapata Off-Shore Co. 5

Bruce G. Forrest v. Verizon Communications Inc. and Verizon Internet Services, Inc. 6

Carnival Cruise Lines, Inc. v. Shute 7

Dix v. ICT Group Inc. 8

Garware Polyester, Ltd. v. Intermax Trading Corp. 9

Groff v. America Online, Inc. 10

Other Cases 11

Conclusion 12

Bibliography 13

Overview

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The legal topic at hand is the forum-selection clause. This clause comes from the Uniform Computer Information Transactions Act article 2b section 110. The forum selection clause limits jurisdiction for the parties who enter into an agreement containing the clause. The enforceability of the forum selection clause came to question through the case of Bremen v. Zapata Off-Shore Co in 1972. Despite having a forum-selection clause, courts refused to decline jurisdiction on the basis of forum non convenience. Bremen v. Zapata Off-Shore Co is a precedent setting case which is now used frequently as a way to work around the necessity to adhere to a forum-selection clause. Now the question has arose, what happened to the strength of the forum-selection clause particularly for online based agreements.

Online based contracts are supposed to be held to the same standard as that of their counterpart print contract. However it has become apparent that this is not the case and that despite having a forum selection clause, cases in which online contracts are in question are being tried in jurisdictions other then the forum specified in the forum selection clause. This can be seen in the case of Freedman v. America Online, Inc. Even though a forum selection clause is signed by Freedman stating that cases would be heard in Virginia, a Florida court refused to enforce the forum-selection clause stating that it would undermine the Florida consumer statutes.

Issue

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Whether a forum-selection clause should be enforced for online purchases when in the enforcement of the forum selection clause the plaintiff is deprived of his or her rights under state law.

Rule

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The Uniform Computer Information Transactions Act article 2b section 110 states that the parties in their agreement may choose an exclusive judicial or arbitral forum unless the choice is unreasonable or unjust. Subsection b provides that a choice of forum term is nonexclusive unless the agreement expressly provides otherwise. Requiring express exclusivity terms provides notice and follows what, in most cases, is the expectation of the parties. A choice of an exclusive forum is not enforceable if it is unreasonable or unjust.

Analysis

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America Online, Inc. v. Pasieka

In the case of America Online Inc. v. Pasieka Florida subscribers of America Online Inc. brought fourth a suit in Florida claiming that America Online Inc was continuing to debit the subscribers credit cards for monthly service fees without authorization; after the subscribers had already canceled their subscriptions. America Online Inc. sought to enforce the forum-selection clause as agreed upon in their "Terms of Service" agreement. This would have required the lawsuit to have been brought fourth in Virginia rather then in Florida. "In this case, a Florida court refused to enforce this clause because the"purpose and effectiveness" of the Florida consumer statutes would be "seriously undermined" if the plaintiffs were required to bring their suit in Virginia. Thus in the case of America Online Inc. v. Pasieka, Florida courts refused to enforce the forum-selection clause.

Bremen v. Zapata Off-Shore Co.

In the case of Breman v. Zapata Off-shore Co. petitioner Unterweser made an agreement to tow Breman drilling rig from Louisiana to Italy. The contract contained a forum-selection clause providing for the litigation of any dispute in the High Court of Justice in London. When the rig under tow was damaged in a storm, Breman instructed Unterweser to tow the rig to Tampa, the nearest port of refuge. There, Breman brought fourth a suit in admiralty against Zapata Off-Shore Co. Unterweser invoked the forum clause in motioned for dismissal. A request was made for jurisdiction of the suit to be brought up in the English court, which ruled that it had jurisdiction under the contractual forum provision. The District Court held the forum-selection clause unenforceable, and refused to decline jurisdiction on the basis of forum non convenience. The Court of Appeals affirmed the decision and held: The forum-selection clause, which was a vital part of the towing contract, is binding on the parties unless respondent can meet the heavy burden of showing that its enforcement would be unreasonable, unfair, or unjust. The Breman v. Zapata Off-shore Co. is a landmark case as far as the forum-selection cause goes. It was a precedent setting case.

Bruce G. Forrest v. Verizon Communications Inc. and Verizon Internet Services, Inc.

In the case of Bruce G. Forrest v. Verizon Communications Inc. and Verizon Internet Services, Inc. Bruce G. Forrest subscribed to services provided by Verizon Internet Services, Inc. After subscribing for the service, Verizon took five months to activate the services. After five months Bruce G. Forrest brought fourth a suit in the District of Columbia. When he signed up for the service Bruce G. Forrest agreed to a forum selection clause as part of a click-on agreement. While the clause was not labeled "forum selection clause" it was still provided in the