Venue-selection Clauses: A Trap for the Unwary
Including a “boilerplate” forum-selection clause in your client’s contract could preclude resulting litigation from proceeding in a federal district court. Forum-selection clauses mandating venue in a particular county are commonplace, particularly in real estate and construction contracts. If, however, the mandated county lacks a physical “bricks-and-mortar” federal courthouse, such a clause might prevent a party from litigating in a federal forum. While the importance of well-drafted forum-selection clauses has been the subject of much discussion,1 their potential to foreclose proper venue in federal court remains relatively unexplored.2 A split of authority in the 11th Circuit confirms this danger for Florida practitioners. Fortunately, prudent drafting should prevent an ostensibly innocuous clause from precluding access to a federal district court.
The Problem
A mandatory forum-selection clause typically designates an exclusive venue or jurisdiction for litigation arising out of a contract.3 Forum-selection clauses can be either geographical (mandating a particular location) or jurisdictional (mandating a particular court).4 Based on this distinction, most courts agree that a clause mandating venue in a particular county — but not specifying a particular court — allows venue in any court that is located in that county.5
For example, in Global Satellite Communication Co. v. Starmill U.K., Ltd., 378 F.3d 1269 (11th Cir. 2004), the 11th Circuit, applying ordinary contract principles, construed a clause mandating venue “in Broward County, Florida,” as allowing litigation in either the Broward County Circuit Court or the Ft. Lauderdale Division of the U.S. District Court for the Southern District of Florida. The contract language did not mandate a particular forum, but only a location (i.e.,
Broward County), where both courts were located.6
The 11th Circuit construed a similar clause, with a similar result, in City of West Palm Beach v. Visionair, Inc. , 199 F. App’x 768 (11th Cir. 2006).7 Visionair involved a forum-selection clause providing that all claims “shall be instituted and prosecuted in Palm Beach County, Florida.”8 Confusing Global Satellite ’s construction of a contractual provision mandating venue “in Broward County” (which Global Satellite held unambiguously permitted venue in any court located in that county) with its construction of a different provision of the same contract (which Global Satellite found to be both vague and ambiguous), the district court held that the Visionair clause was ambiguous and construed it against the drafter to preclude litigation in a federal court located in Palm Beach County.9 The 11th Circuit reversed, discerning no ambiguity in the clause: “Under our decision in Global Satellite, which involved substantially similar language, the clause permits venue in either state or federal court, so long as that court is [located] in Palm Beach County.”10
In short, it appears that in the 11th Circuit a forum-selection clause mandating venue in a county ordinarily will be satisfied by any court located there. Less clear is whether a clause mandating venue in a county that has no “bricks-and-mortar” federal courthouse effectively requires venue exclusively in that county’s state courts. Should courts construe a geographical forum-selection clause mandating venue in a county with no federal courthouse as precluding suit in federal court? Alternatively, should courts interpret such clauses to avoid such an implied or de facto jurisdictional limitation? Although Global Satellite did not present this question, one might plausibly infer an answer from the opinion. The 11th Circuit’s reasoning — that a clause mandating venue in Broward County permitted venue in any forum “located in” that county11; suggests that a clause mandating suit in a county without a physical federal courthouse would require litigation in that county’s state court.
Decisions of other federal courts of appeals support this view. Yet two facts prevent certainty about whether the 11th Circuit will embrace it. First, in decisions after Global Satellite, several district courts in the 11th Circuit have construed clauses mandating venue in a county to permit venue in a federal district court that includes that county but sits elsewhere. Second, and more important, in recent unpublished decisions, the 11th Circuit has taken seemingly different positions on this issue.
The Split of Authority
Some district courts have found clauses mandating venue in a county with no federal courthouse (or providing that venue “shall be” such a county) as ambiguous and have construed them to allow venue in the federal district court that includes that county, even if that federal court is located elsewhere.12 I n 2009, a district court in the Fourth Circuit described this — questionably — as the majority view.13
Other district courts have construed clauses mandating venue in a county with no physical federal courthouse (or providing that venue “shall be” such a county) as limiting venue to the state court located there.14 In 2006, a district court in the 11th Circuit described this as the majority view.15
Several federal courts of appeals have adopted this view. In Yakin v. Tyler Hill Corp., 566 F.3d 72 (2d Cir. 2009), the plaintiff alleged she was injured while attending the defendant’s summer camp. To attend, she was required to submit an application containing a forum-selection clause providing that “venue…shall be in Nassau County, New York.”16 On the date of the application, there was a federal courthouse in Nassau County.17 the time of the lawsuit, however, the courthouse had been relocated to Suffolk County.18 The Second Circuit determined that this move did not affect the meaning of the clause, which was unambiguously geographical:
A reasonable person reviewing the statement, “It is agreed that the venue and place of trial of any dispute that may arise out of this Agreement…shall be in Nassau County, New York,” would necessarily conclude that the parties intended that litigation take place in an appropriate venue in Nassau County and that this commitment was not conditioned on the existence of a federal courthouse in that county.19
Accordingly, the Second Circuit affirmed the district court’s order remanding the case to Nassau County state court.20 Had there been a federal court located in Nassau County at the time of this litigation, remand would have been improper. But there was none.”21
The Third and Fifth circuits have reached similar results in unpublished decisions. Wall St. Aubrey Golf, LLC v. Aubrey, 189 F. App’x 82 (3d Cir. 2006), involved a contract laying venue “in Butler County, Pennsylvania.”22 Because the clause unambiguously required litigation in Butler County, where no federal court was located, only the state court of that county could hear the case: “The Western District of Pennsylvania embraces Butler County within its territorial jurisdiction, but does not have a physical location there…. To hold that the District Court for the Western District of Pennsylvania is a venue in Butler County would torture logic and conflate the disparate concepts of jurisdiction and venue.”23
Similarly, in Argyll Equities LLC v. Paolino, 211 F. App’x 317 (5th Cir. 2006) (per curiam), the Fifth Circuit construed a clause providing for “the exclusive jurisdiction of the courts sitting in Kendall County, Texas.”24 Because the clause required venue in a court that sits ( i.e. , regularly holds proceedings) in Kendall County, venue in the San Antonio Division of the U.S. District Court for the Western District of Texas, which sits in Bexar County, was held improper.25 Significantly, the Fifth Circuit rejected the contention that 28 U.S.C. §141(a), which authorizes special sessions of a district court to be held anywhere in its district, implies that the San Antonio Division “sits” throughout the Western District of Texas.26 Rather, the court held, at least for purposes of the forum-selection clause at issue, “the district court ‘sits’ where it regularly holds court, not in the potentially infinite number of places…where it could hold a special session.”27
In Collin County v. Siemens Business Services, Inc. , 250 F. App’x 45 (5th Cir. 2007), the Fifth Circuit held that a forum-selection clause requiring venue “exclusively in Collin County, Texas,” unambiguously mandated venue in a court located there.28 As in Paolino, the court rejected the contention that the clause permitted venue in a federal district court that includes Collin County but sits elsewhere.29 Accordingly, the court affirmed an order of the U.S. District Court for the Eastern District of Texas in Sherman, Texas, remanding the removed action to a state court located in Collin County.30
Apart from the different contractual language, Collin County presented two facts not present in Paolino. Although no federal courthouse then stood in Collin County, 1) in the statute creating the Sherman Division of the Western District of Texas, Congress specifically directed that court be held in Plano (a city located primarily, though not entirely, in Collin County) as well as in Sherman;31 and 2) plans existed to construct a courthouse in Plano for the Sherman Division.32 The Fifth Circuit found neither fact controlling.33 Instead, the court found “determinative” the fact that the parties never expected the case to be tried in Collin County, where, at the time of removal, no federal district court had ever sat,34 no federal courthouse had ever existed, and (as the parties evidently assumed) none would exist during the pendency of the action.35 While “[t]he planned courthouse’s completion date might well be conclusive of removal rights in future suits” governed by the pertinent forum-selection clause, it did not affect the parties’ rights in the unique circumstances present in Collin County.36
Together, Yakin, Aubrey, Paolino, and Collin County suggest a trend among federal courts of appeals in favor of a rule that a forum-selection clause mandating venue in a county with no physical federal courthouse precludes proper venue in federal district court.
As discussed above, Global Satellite ’s reasoning appears to support the same rule. Not all district courts in the 11th Circuit, however, seem to agree. For example, Ahern v. Fidelity National Title Insurance Co., 664 F. Supp. 2d 1224 (M.D. Fla. 2009), held that a forum-selection clause mandating suit “in the appropriate forum in Osceola County, Florida” — a county with no federal courthouse — did not preclude litigation in “the federal court that encompasses [Osceola County].”37 The Ahern court stated that “numerous” federal courts had consistently held that similar forum-selection clauses “are permissive and do not preclude litigation in the federal court that encompasses the county identified in the forum selection clause.”38 Ahern cited two such decisions, Priority Healthcare Corp. v. Chaudhuri, No. 08-CV-425, 2008 WL 2477623 (M.D. Fla. June 18, 2008), and Links Design, Inc. v. Lahr, 731 F. Supp. 1535 (M.D. Fla. 1990), but did not mention Global Satellite.
Chaudhuri provides no independent support for Ahern ’s holding. That case involved a clause requiring the contracting party “to be subject to personal jurisdiction of the [s]tate of Florida and accept venue in Seminole County, Florida.”39 The court addressed whether this provision was mandatory (requiring venue in the designated forum) or permissive (permitting venue in the designated forum but not precluding venue elsewhere), but did not address which forum the clause designated.40 To support the contention that no ambiguity existed as to the mandated forum, however, the plaintiff attempted to distinguish Global Satellite on the ground that no federal court was located in Seminole County.41 The U.S. magistrate judge42 dismissed this argument in a footnote as “unpersuasive,” citing Links Design ’s pre-Global Satellite holding that a “clause that provided for venue in Polk County was ambiguous and could be interpreted as allowing removal on diversity grounds to the federal district court for the district including Polk County.”43 Neither Ahern nor Chaudhuri provide independent support for their positions on the point at issue.
Links Design involved a forum-selection clause providing, “[i]n the event that any legal action is taken in connection with this [a]greement, the proper venue for said action shall be Polk County, Florida.”44 Seeking remand to state court in Polk County (which has no federal courthouse), the plaintiff argued that — although the Middle District of Florida includes Polk County — the clause required that suit be maintained in a court located in Polk County.45 Noting its agreement with John’s Insulation, Inc. v. Siska Construction Co., 671 F. Supp. 289 (S.D.N.Y. 1987) (construing a clause providing that “any action hereunder shall be commenced in the Supreme Court of the [s]tate of New York” as allowing removal), the district court found the clause ambiguous and interpreted it against the drafter to allow removal to the Middle District’s Tampa Division, which is located in Hillsborough County.46
In view of its lack of a clearly articulated rationale and the 11th Circuit’s reasoning in Global Satellite, Links Design provides weak support even for its limited holding that a clause providing that venue “shall be” a county with no federal courthouse can be reasonably construed to permit removal to the federal district court that includes that county. Accordingly, several district courts have rejected arguments based on Links Design.
For example, Colorado Boxed Beef Co. v. Coggins, 8:07-CV-00223-T-24MAP, 2007 WL 917302 (M.D. Fla. Mar. 23, 2007), construed a forum-selection clause providing that venue “shall be exclusively initiated and maintained in Polk County, Florida” (where there is no federal courthouse)as precluding litigation in federal court. “Since the only courts located in Polk County, Florida are state courts, the forum selection clause mandates that a state court located in Polk County is the agreed-upon forum.”47 The court rejected an argument, based on Links Design, that the clause was ambiguous.48
Similarly, in Paolino v. Argyll Equities, L.L.C. , No. SA-05-CA-0342, 2005 WL 2147931 (W.D. Tex. Aug. 31, 2005), aff’d, 211 F. App’x 317, 319 (5th Cir. 2006), the district court declined to follow Links Design, as it conflicted with “the weight of authority.”49
Seemingly Inconsistent 11th Circuit Authority
In a recent unpublished decision, the 11th Circuit addressed the issue left open by Global Satellite. Cornett v. Carrithers, 465 F. App’x 841 (11th Cir. 2012) (per curiam), involved a clause providing that “venue shall be Suwannee County[,] Florida.”50 Applying Global Satellite ’s reasoning, the court held that the clause unambiguously precluded litigation in a federal court located elsewhere:
The parties do not dispute that this clause, which uses the term “shall,” is mandatory; rather, the [defendants] argue that there is ambiguity as to whether the clause mandates Suwannee County’s state or federal courts. However, while Suwannee County, Florida, lies within the geographic region served by the Jacksonville Division of the Middle District, there is no federal court situated in Suwannee County, Florida. See M.D. Fla. R. 1.02(b)(1). Under our clearly applicable reasoning in Global Satellite , because the only court situated in Suwannee County, Florida, is the Circuit Court for the Third Judicial Circuit, the [contract’s] forum selection clause did in fact designate that court as the particular forum in which the parties must bring suit. the same token, removal of the action to the United States District Court for the Middle District of Florida, Jacksonville Division, located outside of Suwannee County, Florida, would not satisfy the venue requirement. Thus, the district court did not err in remanding the case to Suwannee County state court.51
Cornett, then, interpreted a forum-selection clause mandating venue in a county with no federal courthouse as limiting litigation to state court in that county.
At the time it was decided, Cornett appeared likely to settle the issue for most practical purposes. It was the only 11th Circuit decision directly on point, and it relied for its holding on what it described as the “clearly applicable reasoning” of binding circuit precedent.52 Moreover, although Cornett was not itself binding precedent, practitioners do not lightly disregard unpublished decisions of their circuit; nor do district courts. It was, therefore, not surprising that, shortly after Cornett was decided, a district court in the 11th Circuit relied on this decision to construe a forum-selection clause mandating venue in Brevard County (where no federal courthouse is located) as precluding removal.53
In August 2012, however, the 11th Circuit spoke again, construing an arguably indistinguishable forum-selection clause in a manner seemingly inconsistent with Cornett. Mosaic Fertilizer, LLC v. Van Fleet International Airport Development Group, LLC, 486 F. App’x 869 (11th Cir. 2012) (per curiam), cert. den. (Apr. 15, 2013), involved a forum-selection clause providing, “venue for any action arising out of or connected with this [a]greement shall be the counties in which the [p]roperty is located.”54 The property at issue was located in Hardee and Polk counties, neither of which has a federal courthouse.55 The defendant moved to dismiss for improper venue under Fed. R. Civ. P. 12(b)(3), arguing that the clause required venue in the state court for Hardee County, where most of the property was located. In an order predating Cornett, the district court denied the motion because 1) the clause did not expressly require venue in Hardee County state court, and 2) in any event, the Tampa Division of the Middle District of Florida encompasses Hardee County.56
On appeal, the plaintiff made a number of arguments to support federal jurisdiction,57 and added that the court should not follow Cornett. Without mentioning these arguments, Cornett, or the decisions of sister circuits holding that a forum-selection clause requiring venue in a county with no federal court constitutes a de facto jurisdictional restriction — the 11th Circuit affirmed, stating as follows:
[A]s the district court noted, the forum selection clause is mandatory but does not expressly limit venue to the state circuit court for Hardee County. See Global Satellite Commc’n Co. v. Starmill U.K. Ltd ., 378 F.3d 1269, 1274 (11th Cir. 2004) (“If Global Satellite intended to permit suit only in the state courts of Florida located in Broward County, as it claims, it could easily have stated that intention precisely.”). Rather, the clause refers to the location of the property and not to the type of court. Here, the property in question is in Hardee and Polk [c]ounties, and both counties are in the Tampa Division of the U.S. District Court for the Middle District of Florida. See 28 U.S.C. §89(b) (stating that the Middle District of Florida includes Polk and Hardee [c]ounties); M.D. Fla. Local Rule 1.02(b)(4) (including Hardee and Polk Counties within the Tampa Division of the Middle District of Florida). Thus, we find no error in the district court’s conclusion that the forum selection clause was satisfied.58
It is difficult to reconcile the 11th Circuit’s opinions in Cornett and Van Fleet.59 Cornett recognizes de facto or implied jurisdictional restrictions, holding that a forum-selection clause mandating venue in a county with no physical federal courthouse effectively precludes suit in federal district court. Van Fleet suggests that such a clause permits suit in the federal district court that includes such a county. Neither decision, however, binds future panels.60
The resulting uncertainty suggests two lessons for practitioners. First, if you want to restrict venue for disputes to state court, say so explicitly, using specific jurisdictional (not merely geographic) language, which also accounts for the possibility of post-suit removal. Second, if you want to ensure that your forum-selection clause does not preclude litigation in federal court, say so explicitly, and do not use language mandating venue in a county where no federal district court sits in a “bricks-and-mortar” courthouse. Beyond that, the authors will not suggest any particular language, but merely note that any language restricting the situs or the court in which disputes may be litigated must be carefully considered in light of all relevant authorities.
Conclusion
As with most contract drafting issues, the “coin of the realm” is precision and specificity. To ensure your forum-selection clause does not preclude litigation in federal court, say so clearly. Although Van Fleet suggests that it might be possible to distinguish Global Satellite, Visionair, and Cornett and successfully argue federal jurisdiction for your client, this line of cases militates strongly toward being safe rather than sorry. This strategy is consonant with the decisions of the Second, Third, and Fifth circuits discussed above, holding that clauses mandating venue in a county with no physical federal courthouse requires litigation in a state court located there.
1 See, e.g. , Stephen MacGillivray & Raymond Ripple, The Importance of a Carefully Drafted Forum Selection Clause, 58 R.I. B. J. 17, 20 (Dec. 2009), available at https://www.ribar.com/UserFiles/File/Nov_Dec%2009%20Journal_f2_web.pdf; Michael S. Oberman, Practice Points for Forum Selection Clauses, 15
Com. & Fed. Litig. Sec. Newsl. 5 (Fall 2009).
2 But see generally David S. Coale, Rebecca L. Visosky & Diana K. Cochrane, Contractual Waiver of the Right to Remove to Federal Court: How Policy Judgments Guide Contract, Interpretation, 29
Rev. Litig. 327 (2010) (analyzing waiver of right to remove to federal courts via various different word choices including “in [named county]”).
3 See Global Satellite Commc’n Co. v. Starmill U.K., Ltd., 378 F.3d 1269, 1272 (11th Cir. 2004). Forum-selection clauses are presumptively valid and enforceable absent a “‘strong showing that enforcement would be unfair or unreasonable under the circumstances.’” Xena Inv., Ltd. v. Magnum Fund Mgmt., 726 F.3d 1278, 1284 (11th Cir. 2013) (quoting Krenkel v. Kerzner Int’l Hotels Ltd. , 579 F.3d 1279, 1281 (11th Cir. 2009)).
4 See Yakin v. Tyler Hill Corp., 566 F.3d 72 (2d Cir. 2009).
5 See, e.g., Simonoff v. Expedia, Inc. , 643 F.3d 1202, 1206 (9th Cir. 2011); Alliance Health Grp., LLC v. Bridging Health Ops., LLC, 553 F.3d 397, 400 (5th Cir. 2008); Basicomputer Corp. v. Scott, 973 F.2d 507, 511 (6th Cir. 1992); cf. FindWhere Holdings, Inc. v. Sys. Env’t Optimization, LLC, 626 F.3d 752, 755 (4th Cir. 2010). But see Excell, Inc. v. Sterling Boiler & Mech. , 106 F.3d 318 (10th Cir. 1997).
6 Global Satellite, 378 F.3d 1269. The court rejected the argument that the district court’s local rule, which could potentially permit trial outside of the specified county, warranted interpreting the clause to forbid removal. Id. at 1273.
7 I n the 11th Circuit, “[u]npublished opinions are not considered binding precedent, but they may be cited as persuasive authority.”
11th Cir. R. 36-2; see also Borden v. Allen, 646 F.3d 785, 808 n.27 (11th Cir. 2011).
8 Visionair, 199 F. App’x at 769.
9 See id. at 769-70 and n.2.
10 Id. at 770. The court also rejected the contention that a temporary closure of the federal courthouse in Palm Beach County could potentially prevent trial there. Id. What mattered was that the litigation had proceeded in Palm Beach County, Florida. Id.
11 Global Satellite, 378 F.3d at 1272; see also Visionair, 199 F. App’x at 770 (forum-selection clause mandating that claims be “instituted and prosecuted” in Palm Beach County “indicates only that litigation must be ‘instituted and prosecuted’ in either a state or federal forum, so long as that forum is in Palm Beach County”) (emphasis added).
12 See, e.g. , Xgel Tech., LLC v. C.I. Kasei Co. , No. 4:09-CV-540 RWS, 2009 WL 1576837 at *2 (E.D. Mo. Jun. 3, 2009); Epps v. 1.I.L. , No. 07-02314, 2007 WL 4463588 at *3 (E.D. Pa. Dec. 19, 2007); Merrell v. Renier, No. C06-404JLR, 2006 WL 1587414 at *2 (W.D. Wash. Jun. 6, 2006); Nahigian v. Juno-Loudoun, LLC, 661 F. Supp. 2d 563, 567-568 (E.D. Va. 2009). Nahigian has been criticized by other district courts in the Fourth Circuit. See Match Factors, Inc. v. Mickey B. Henson Enters, Inc. , No. 4:10-CV-00062-FL, 2011 WL 1101363 at * 9 (E.D.N.C. Mar. 1, 2011); Rihani v. Team Express Distrib., LLC, 711 F. Supp. 2d 557, 558-561 (D. Md. 2010).
13 See Nahigian, 661 F. Supp. 2d at 568.
14 See, e.g., Paolino v. Argyll Equities, L.L.C. , No. SA-05-CA-0342, 2005 WL 2147931 at *5 (W.D. Tex. Aug. 31, 2005), aff’d, 211 F. App’x 317, 319 (5th Cir. 2006); Weener Plastics, Inc. v. HNH Packaging, LLC, No. 5:08-CV-496-D, 2009 WL 2591291 at *8 (E.D.N.C. Aug. 19, 2009); Alliantgroup, L.P. v. Feingold, No. H-09-0479, 2009 WL 514058 at *5 (S.D. Tex. Mar. 2, 2009).
15 See Travelers Prop. Cas. Co. v. OneSource Facility Servs., No. 3:05 CV 00618 WKW, 2006 WL 752925 at *3, n.7 (M.D. Ala. 2006) (quoting Paolino, 2005 WL 2147931 at *4) (“Most courts that have been asked to interpret similarly-worded clauses have concluded that the federal court of the district embracing the county named in the clause is not a permissible forum.”).
16 Yakin, 566 F.3d at 74.
17 Id.
18 Id.
19 Id. at 76.
20 Id.
21 Id.
22 Aubrey, 189 F. App’x at 84.
23 Id. at 86 (emphasis in original).
24 Paolino, 211 F. App’x at 318.
25 Id.
26 Id. at 319.
27 Id. In OneSource Facility Services, 2006 WL 752925 at *3, the district court rejected a similar argument based on the federal change of venue statute, 28 U.S.C. §1404(c), which provides that “[a] district court may order any civil action to be tried at any place within the division in which it is pending.”
28 Collin County, 250 F. App’x at 47, 50-54.
29 Id. at 50-54.
30 Id. at 54.
31 See 28 U.S.C. §124(c)(3) (“Court for the Sherman Division shall be held at Sherman and Plano.”) (emphasis added).
32 See Collin County, 250 F. App’x at 52-53.
33 Id.
34 T he U.S. Bankruptcy Court for the Eastern District of Texas did sit in Plano and that court “was probably hearing cases in Plano at the time this case was removed.” Id. at 54 n.10. But this did not alter the parties’ expectations. See id. (Defendants “did not raise the possibility that the district court could hear their case in the bankruptcy court’s quarters until appeal. Further, it appears that they never expected this possibility to control the outcome of the [c]ounty’s motion to remand.”).
35 Id. at 53.
36 Id. ; see also id. at 54 (“We consider the circumstances of this appeal to present a very narrow, one-time question.”).
37 Ahern, 664 F. Supp. 2d at 1227.
38 Id.
39 Chaudhuri, 2008 WL 2477623 at *1.
40 Id. at *2.
41 Id. at *2, n.1.
42 T he parties had previously consented to proceed before the U.S. magistrate judge for all proceedings pursuant to 28 U.S.C. §636(c).
43 Chaudhuri, 2008 WL 2477623 at *2, n.1.
44 Links Design, 731 F. Supp. at 1536.
45 Id. at 1537.
46 Id. at 1538.
47 Coggins, 2007 WL 917302 at *4.
48 Id.
49 Paolino, 2005 WL 2147931 at *5.
50 Cornett, 465 F. App’x at 842.
51 Id. at 843.
52 Id.
53 See Millennium Med. Mgmt., LLC v. Ling Li, 6:12-CV-663-ORL-31, 2012 WL 1940112 at *2 (M.D. Fla. May 29, 2012). The district court distinguished its own prior decision in Ahern, and declined to follow Links Design. Id. at *2 and n.1.
54 Cornett, 486 F. App’x at 872. The authors served as trial and appellate counsel in Mosaic Fertilizer, LLC v. Van Fleet International Airport Development Group, LLC, 486 F. App’x 869 (11th Cir. 2012) (per curiam), cert. den. (Apr. 15, 2013).
55 Id.
56 Van Fleet, 486 F. App’x at 872.
57 One of Mosaic ’s arguments was that the law in effect at the time of the agreement should govern. Mosaic noted that the agreement in the case was entered into in 2003, and, at that time, cases interpreting similar forum-selection clauses permitted venue in any federal court that encompassed the county identified in the clause. See, e.g., Links Design, 731 F. Supp. at 1536. When the litigation commenced in January 2010, courts continued to reach the same conclusion. See, e.g., Chaudhuri, 2008 WL 2477623 at *2; Ahern, 664 F. Supp. at 1227. Cornett was not decided until after the appeal had commenced.
58 Van Fleet, 486 F. App’x at 872.
59 However, it may be less difficult to reconcile the results. As Mosaic pointed out in its brief to the 11th Circuit, Van Fleet can be distinguished from Cornett because 1) venue was proper in federal court under the law at the time of the agreement, see Van Fleet, 486 F. App’x at 872, and 2) Van Fleet waived the argument by failing to argue in the district court or in its initial brief to the 11th Circuit that the Tampa Division of the Middle District of Florida was an improper federal forum because it did not have a courthouse physically located in either Polk or Hardee county.
60 Since Van Fleet, it appears that only one district court within the 11th Circuit has confronted the issue of whether a forum-selection clause mandating venue in a county without a “bricks-and-mortar” federal courthouse precludes jurisdiction. In Mobile Aggregates Recycling Servs., Inc. v. Collier Aggregates, LLC, 2:13-cv-42-FtM-29UAM, 2013 WL 2479782 (M.D. Fla. June 10, 2013), the district court followed Cornett. Id. at *1. The court held that a venue selection clause that specified “a court of competent jurisdiction in Collier County” precluded suit in federal court because there was no federal courthouse in Collier County. Id. Notably, the court did not cite Van Fleet in its opinion. Id.
David Weinstein is a managing shareholder of Greenberg Traurig’s Tampa office.
Andrew Patch is a senior associate in Greenberg Traurig’s Tampa office.
The authors recognize associate Chelsae Johansen and former associate Patrick Barthle, now a judicial law clerk for U.S. District Judge Mary S. Scriven, for their assistance with this article.
