Brief Fact Summary.
Respondents sued Petitioner in Washington for negligently causing them harm. Petitioner moved for summary judgment because Respondents had agreed to a forum-selection clause mandating lawsuits be brought in Florida and Washington lacked personal jurisdiction.
Synopsis of Rule of Law.
Forum-selection clauses are enforceable so long as they are fair.
Finally, plaintiffs have conceded that they were given notice of the forum provision and, therefore, presumably retained the option of rejecting the contract with impunity.View Full Point of Law
Eulala and Russell Shute (Respondents) brought suit in the Western District of Washington against Carnival Cruise Lines (Petitioner), arguing that Petitioner negligently caused Eulala’s injury on the cruise ship. Petitioner moved for summary judgment, arguing that the tickets bought by the Respondent included a forum-selection clause requiring lawsuits be brought in Florida. Petitioner argued alternatively that Washington lacked personal jurisdiction because Petitioner did not have sufficient contacts with Washington.
Is the forum-selection clause enforceable?
Yes, the forum-selection clause is enforceable. The decision of the Court of Appeals is reversed.
Justice Stevens argued that the forum-selection clause was not fair and thus not enforceable. He argued that the small print of the ticket would prohibit many from having proper notice of the forum-selection clause until at least after they purchased the ticket. He also noted the uneven bargaining power of the parties, the fact that the tickets could not be refunded after purchase, and that the Respondents would suffer an unreasonable burden litigating in Florida where it would be harder to gather witnesses.
The Court determined that the forum-selection clause was enforceable. It was reasonable for the parties not to negotiate the forum-selection clause because, given the nature of cruises, it was reasonable for the Petitioner to have include a forum-selection clause on all tickets. Additionally, respondents have not demonstrated a justifiable inconvenience for not being able to litigate in Florida. Finally, the Court determined that the forum-selection clause did not violate 46 U.S.C.App. § 183c because Florida is a court of competent jurisdiction.