A forum selection clause identifies an agreed venue for disputes. Mandatory clauses require litigation in the designated forum, while permissive clauses merely consent to jurisdiction there.
Federal courts enforce valid clauses through transfer under section 1404 rather than dismissal, absent extraordinary circumstances.
Alternative Names:
Choice of Forum Clause, Venue Clause
Why it Matters?
Enforcement is strong, and the Supreme Court's Atlantic Marine decision directs that a valid clause be given controlling weight in transfer analysis, with the plaintiff's chosen forum receiving no deference. That makes the clause a reliable planning tool in commercial agreements. The distinction between mandatory and permissive language is where disputes arise, so drafting should be explicit.
Frequently Confused with
Related terms
Frequently asked questions
How are forum selection clauses enforced in federal court?
What distinguishes mandatory from permissive clauses?
