Supreme Court Enforces Forum-Selection Clauses

December 4, 2013

On December 3, 2013, the U.S. Supreme Court issued Atlantic Marine Construction Company, Inc. v. United States District Court for the Western District of Texas, a unanimous opinion delivered by Justice Alito reaffirming that federal courts must enforce forum-selection clauses in all but the most exceptional cases. The Supreme Court held that when parties have agreed to a valid forum-selection clause, a district court should ordinarily transfer the case to the forum specified in that clause, and that transfer should only be denied under extraordinary circumstances unrelated to the convenience of the parties. This decision has important implications for all parties to commercial contracts, which now have further certainty that they can choose their forum in advance and their choice will be enforced absent extraordinary circumstances.