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Court Watch

By Cynthia M. Klaus and Susan E. Tegt
February 28, 2014

U.S. Supreme Court Strengthens Franchisors' Ability to Litigate In Chosen Forum

On Dec. 3, 2013, the U.S. Supreme Court issued a unanimous opinion clarifying the procedural mechanism for dismissing or transferring a lawsuit in which the parties to the lawsuit are also parties to a contract with a valid forum-selection provision. Atlantic Marine Construction Co. v. United States District Court for the Western District of Texas, 134 S. Ct. 568, 571 U.S. ___ (2013). Perhaps more important, particularly for franchisors and other business owners, the Supreme Court held that such contractual forum-selection clauses will be enforced in “all but the most unusual cases.” This ruling gives franchisors strengthened ability to litigate contractual disputes in the forum of their choosing.

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