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can someone please explain the difference? Also, in what circumstances can forum selection clauses be ignored?

On this topic, I seem to have written in my notes that after transfer, the law used is the one from the first venue, but that can't be right, right? Otherwise you could just bring suit in an improper venue because the law was more favorable.

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Thanks for the replies. We haven't really covered it at all -- my prof just noted we'd have plenty of time to learn about it in conflicts of law. I probably just wrote down what he said incorrectly.

1404 transfer takes the original forum law with it. 1406 does not because the venue was improper to begin with. Forum selection clauses are not enforced when they lack sufficient notice to the party being subjected to it and unfairly prejudicial. (I think the case is Carnival Cruise Lines or something to do with a cruise ticket that had fine print.)

Mce252 wrote:1404 transfer takes the original forum law with it. 1406 does not because the venue was improper to begin with. Forum selection clauses are not enforced when they lack sufficient notice to the party being subjected to it and unfairly prejudicial. (I think the case is Carnival Cruise Lines or something to do with a cruise ticket that had fine print.)

I think they upheld the forum selection clause in Carnival though.

ph14 wrote:

Mce252 wrote:1404 transfer takes the original forum law with it. 1406 does not because the venue was improper to begin with. Forum selection clauses are not enforced when they lack sufficient notice to the party being subjected to it and unfairly prejudicial. (I think the case is Carnival Cruise Lines or something to do with a cruise ticket that had fine print.)

I think they upheld the forum selection clause in Carnival though.

You're probably right - I just remember the fairness and notice requirements.

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acrossthelake wrote:

Mce252 wrote:1404 transfer takes the original forum law with it. 1406 does not because the venue was improper to begin with. Forum selection clauses are not enforced when they lack sufficient notice to the party being subjected to it and unfairly prejudicial. (I think the case is Carnival Cruise Lines or something to do with a cruise ticket that had fine print.)

1404 doesn't take the original forum law with it if PJ was improper in the transferor court.

Doesn't a defect make it a 1406 transfer? I have only thought of the transfer in terms of venue but my understanding was that both forums have to be proper to use 1404. 1406 is when the transfer is made to cure a defect.

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betasteve wrote:

ph14 wrote:

Mce252 wrote:1404 transfer takes the original forum law with it. 1406 does not because the venue was improper to begin with. Forum selection clauses are not enforced when they lack sufficient notice to the party being subjected to it and unfairly prejudicial. (I think the case is Carnival Cruise Lines or something to do with a cruise ticket that had fine print.)

I think they upheld the forum selection clause in Carnival though.

I recall this as well, I think. I believe it's a pretty high standard to get out of a forum selection clause.

In Carnival Cruise the party conceded that notice was given, so the court didn't go through the analysis. Had the Shutes, or whatever their names were, not conceded notice, the clause likely would not have been upheld.

It's important to remember that this is only binding on federal admiralty law. I think some states have adopted it, some haven't.

oppotomus wrote:

betasteve wrote:

ph14 wrote:

Mce252 wrote:1404 transfer takes the original forum law with it. 1406 does not because the venue was improper to begin with. Forum selection clauses are not enforced when they lack sufficient notice to the party being subjected to it and unfairly prejudicial. (I think the case is Carnival Cruise Lines or something to do with a cruise ticket that had fine print.)

I think they upheld the forum selection clause in Carnival though.

I recall this as well, I think. I believe it's a pretty high standard to get out of a forum selection clause.

In Carnival Cruise the party conceded that notice was given, so the court didn't go through the analysis. Had the Shutes, or whatever their names were, not conceded notice, the clause likely would not have been upheld.

It's important to remember that this is only binding on federal admiralty law. I think some states have adopted it, some haven't.

That's the analysis that's in most of the casebooks so it's prob a safe bet to use it.

acrossthelake wrote:

Mce252 wrote:

acrossthelake wrote:

Mce252 wrote:1404 transfer takes the original forum law with it. 1406 does not because the venue was improper to begin with. Forum selection clauses are not enforced when they lack sufficient notice to the party being subjected to it and unfairly prejudicial. (I think the case is Carnival Cruise Lines or something to do with a cruise ticket that had fine print.)

1404 doesn't take the original forum law with it if PJ was improper in the transferor court.

Doesn't a defect make it a 1406 transfer? I have only thought of the transfer in terms of venue but my understanding was that both forums have to be proper to use 1404. 1406 is when the transfer is made to cure a defect.

1406 is venue defect, 1404 is venue alright. But you only apply transferor court if both PJ & venue were okay. My prof has a chart about it he gave us in a handout.

Gotcha. Makes sense.

Hope this helps. From my 1L notes from last year (1 = major heading, A = sub heading, i = sub-sub heading.


1. Carnival Cruise Lines Inc. v. Shute:
A. "Forum Selection Clause" not the same as a "Choice of Law" provision.
i. Forum Selection Clause identifies the location the case will be heard at.
ii. Choice of Law provision identifies the State whose laws will apply to the contract.
C. Forum Selection Clauses "are prima facie valid" and "should be enforced" by federal courts sitting in admiralty "unless enforcement is shown by resisting party to be 'unreasonable' under the circumstances."


2. Choice of Law: What forum's law should be used. Sometimes called conflict of law.
A. Horizontal (Which State's Law Should Be Used?) Choice of Law Versus Vertical (Use Federal or State Law?) Choice of Law.
i. Horizontal: Which state's law should be applied? You know that state law is going to apply, but you don't know which state law should apply. Similarly, this applies to diversity cases where the federal district court determines which state's law to use. Ex. Plaintiff and Defendant are residents of different states, but the cause of action occurs in a third state. Not covered in this class, focus on vertical choice of law.
B. Vertical: Deals with cases is filed in federal district court. Question as to whether state or federal law should be applied to the issue. We primarily deal with vertical choice of law questions in this class (Erie)

random5483 wrote:Hope this helps. From my 1L notes from last year (1 = major heading, A = sub heading, i = sub-sub heading.


1. Carnival Cruise Lines Inc. v. Shute:
A. "Forum Selection Clause" not the same as a "Choice of Law" provision.
i. Forum Selection Clause identifies the location the case will be heard at.
ii. Choice of Law provision identifies the State whose laws will apply to the contract.
C. Forum Selection Clauses "are prima facie valid" and "should be enforced" by federal courts sitting in admiralty "unless enforcement is shown by resisting party to be 'unreasonable' under the circumstances."


2. Choice of Law: What forum's law should be used. Sometimes called conflict of law.
A. Horizontal (Which State's Law Should Be Used?) Choice of Law Versus Vertical (Use Federal or State Law?) Choice of Law.
i. Horizontal: Which state's law should be applied? You know that state law is going to apply, but you don't know which state law should apply. Similarly, this applies to diversity cases where the federal district court determines which state's law to use. Ex. Plaintiff and Defendant are residents of different states, but the cause of action occurs in a third state. Not covered in this class, focus on vertical choice of law.
B. Vertical: Deals with cases is filed in federal district court. Question as to whether state or federal law should be applied to the issue. We primarily deal with vertical choice of law questions in this class (Erie)

I'm confused - I thought the court in Carnival was sitting in diversity and... that was the whole point, that they were extending the Bremen decision to cover any situation, not just businesses involved in admirality disputes.

As far as "horizontal" choice of law, the case is Klaxon v. Stentor, and it says that the district court will apply the choice-of-law provisions of the state in which the court sits. This codifies what you see in Erie: New York federal district court applies NY state choice-of-law statutes to get Pennsylvania law (presumably because it picks the law of the location of the tort or something like that).

betasteve wrote:

ahduth wrote:
As far as "horizontal" choice of law, the case is Klaxon v. Stentor, and it says that the district court will apply the choice-of-law provisions of the state in which the court sits. This codifies what you see in Erie: New York federal district court applies NY state choice-of-law statutes to get Pennsylvania law (presumably because it picks the law of the location of the tort or something like that).

Erie is federal v. state law application. Horizontal is state v. state application. Also, it's common law - not codified.

True, it's not codified, it's just settled in Klaxon. Confused about the first part though - Erie requires a choice-of-law provision when you've decided to apply state law - how else do you get a state versus state question other than under 1332?

ahduth wrote: I'm confused - I thought the court in Carnival was sitting in diversity and... that was the whole point, that they were extending the Bremen decision to cover any situation, not just businesses involved in admirality disputes.

You are mistaken regarding Carnival:

"We begin by noting the boundaries of our inquiry. First, this is a case in admiralty, and federal law governs the enforceability of the forum-selection clause we scrutinize." Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585, 590, (1991).

That being said, federal courts routinely extend The Bremen and its progeny to non-admiralty matters. See, e.g., Argueta v. Banco Mexicano, S.A., 87 F.3d 320, 325 (9th Cir. 1996) ("Although Bremen is an admiralty case, its standard has been widely applied to forum selection clauses in general.").

As for the choice-of-law analysis, this is the subject of a significant circuit split: the courts disagree over whether forum-selection clauses are substantive or procedural. The majority view is that such clauses are procedural, and therefore a federal court sitting in diversity should apply federal law when considering the enforceability of the clause. See Wong v. PartyGaming Ltd., 589 F.3d 821, 827 (6th Cir. 2009) (discussing circuit split and identifying majority position).

There's also a split over the proper procedural mechanism for enforcing a forum-selection clause. Most federal courts seem to view a 12(b)(3) as the proper mechanism, but others have used 12(b)(1), 12(b)(6), and 1404, all of which involve a slightly different analysis. It's an interesting problem.

ahduth wrote:

random5483 wrote:Hope this helps. From my 1L notes from last year (1 = major heading, A = sub heading, i = sub-sub heading.


1. Carnival Cruise Lines Inc. v. Shute:
A. "Forum Selection Clause" not the same as a "Choice of Law" provision.
i. Forum Selection Clause identifies the location the case will be heard at.
ii. Choice of Law provision identifies the State whose laws will apply to the contract.
C. Forum Selection Clauses "are prima facie valid" and "should be enforced" by federal courts sitting in admiralty "unless enforcement is shown by resisting party to be 'unreasonable' under the circumstances."


2. Choice of Law: What forum's law should be used. Sometimes called conflict of law.
A. Horizontal (Which State's Law Should Be Used?) Choice of Law Versus Vertical (Use Federal or State Law?) Choice of Law.
i. Horizontal: Which state's law should be applied? You know that state law is going to apply, but you don't know which state law should apply. Similarly, this applies to diversity cases where the federal district court determines which state's law to use. Ex. Plaintiff and Defendant are residents of different states, but the cause of action occurs in a third state. Not covered in this class, focus on vertical choice of law.
B. Vertical: Deals with cases is filed in federal district court. Question as to whether state or federal law should be applied to the issue. We primarily deal with vertical choice of law questions in this class (Erie)

I'm confused - I thought the court in Carnival was sitting in diversity and... that was the whole point, that they were extending the Bremen decision to cover any situation, not just businesses involved in admirality disputes.

As far as "horizontal" choice of law, the case is Klaxon v. Stentor, and it says that the district court will apply the choice-of-law provisions of the state in which the court sits. This codifies what you see in Erie: New York federal district court applies NY state choice-of-law statutes to get Pennsylvania law (presumably because it picks the law of the location of the tort or something like that).

I took civ pro last year, so I might not be exact here. Carnival Cruise Line was a personal jurisdiction case (if I recall right). When we first reviewed the case we only considered its implications for jurisdiction. In the case, however, the court discusses the effect of a choice of law provision on jurisdiction. The court distinguishes between a forum selection clause and a choice of law clause and basically states that a choice of law clause is insufficient, without more, to establish personal jurisdiction.


Horizontal Choice of law deals with determining which states law controls. My civ pro class discussed this concept, but we did not go into the details. Vertical choice of law (determining whether federal or state law applies) played a much more important role. Vertical choice of law involves the Erie Doctrine (Erie, Hannah, etc).


Some of this might be confusing for 1Ls because civ pro professors teach their classes differently. Some schools don't address Erie till the second semester. Hopefully I helped clarify your question.

What if the plaintiff is suing for breach of contract and ignoring his own adhesive contract stating a selection of forum? The contract is a credit application with very vague language. However it is very clear that "any litigation shall be in a specific state, unspecific court.