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Supreme Court of the United States
February 29, 1988, Argued ; June 20, 1988, Decided
[*24] [***27] [**2240] JUSTICE MARSHALL delivered the opinion of the Court.
This case presents the issue whether a federal court sitting in diversity should apply [**2241] state or federal law in adjudicating a motion to transfer a case to a venue provided [****5] in a contractual forum-selection clause.
The dispute underlying this case grew out of a dealership agreement that obligated petitioner company, an Alabama corporation, to market copier products of respondent, a nationwide manufacturer with its principal place of business in New Jersey. The agreement contained a forum-selection clause providing that any dispute arising out of the contract could be brought only in a court located in Manhattan. 1 Business relations between the parties soured under circumstances that are not relevant here. In September 1984, petitioner brought a complaint in the United States District Court for the Northern District of Alabama. The core of the complaint was an allegation that respondent had breached the dealership agreement, but petitioner also included claims for breach of warranty, fraud, and antitrust violations.
[****6] Relying on the contractual forum-selection clause, respondent moved the District Court either to transfer the case to the Southern District of New York under 28 U. S. C. § 1404(a) or to dismiss the case for improper venue under 28 U. S. C. § 1406. The District Court denied the motion. Civ. Action No. 84-AR-2460-S (Jan. 29, 1985). It reasoned that the transfer motion was controlled by Alabama law and that Alabama looks unfavorably upon contractual forum-selection clauses. The court certified its ruling for interlocutory appeal, [*25] see 28 U. S. C. § 1292(b) (1982 ed., Supp. IV), and the Court of Appeals for the Eleventh Circuit accepted jurisdiction.
On appeal, a divided panel of the Eleventh Circuit reversed the District Court. The panel concluded that questions of venue in diversity actions are governed by federal law, and that the parties' forum-selection clause was enforceable as a matter of federal law. 779 F. 2d 643 (1986). The panel therefore reversed the order of the District Court and remanded with instructions to transfer the case to a Manhattan court. After petitioner successfully moved for rehearing en banc, 785 F. 2d 896 (1986), the full Court of Appeals proceeded to adopt [****7] the result, and much of the reasoning, of the panel opinion. 810 F. 2d 1066 (1987). 2 The en banc court, citing Congress' enactment or approval of several rules to govern venue determinations in diversity actions, first determined that "[v]enue is a matter of federal procedure." Id., at 1068. The Court of Appeals then applied the standards articulated in the admiralty case of The Bremen v. Zapata Off-Shore Co., 407 U.S. 1 [***29] (1972), to conclude that "the choice of forum clause in this contract is in all respects enforceable generally as a matter of federal law . . . ." 810 F. 2d, at 1071. We now affirm under somewhat different reasoning.
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487 U.S. 22 *; 108 S. Ct. 2239 **; 101 L. Ed. 2d 22 ***; 1988 U.S. LEXIS 2791 ****; 56 U.S.L.W. 4659
STEWART ORGANIZATION, INC., ET AL. v. RICOH CORP. ET AL.
Prior History: CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT.
Disposition: 810 F. 2d 1066, affirmed and remanded.
forum-selection, district court, federal court, parties, federal law, state law, diversity, venue, courts, clauses, factors, contractual, witnesses, rules of procedure, controlling issue, arbitration, convenience, encouraged, convenience of the parties, federal statute, federal rule, twin-aims, shopping, sitting, cases, falls, weigh
Civil Procedure, Preliminary Considerations, Federal & State Interrelationships, Erie Doctrine, General Overview, Governments, Legislation, Enactment, Federal Government, US Congress, Venue, Federal Venue Transfers, Convenience Transfers, Constitutional Law, Congressional Duties & Powers, Lower Federal Courts, Necessary & Proper Clause