A choice-of-law clause is a contractual provision that selects a law to govern the contract. These clauses facilitate settlement by identifying the law that will be applied to resolve future disputes, thereby allowing the parties to more accurately assess the strength of potential claims. They also reduce the costs of litigation by making it unnecessary for a court to conduct a choice-of-law analysis.
A Primer on Choice-of-Law Clauses
A choice-of-law clause is a contract provision that selects the law to govern the contract and claims relating to the contract.
Continue ReadingRethinking the Internal Affairs Rule
The internal affairs rule posits that a court should generally apply the law of the state in which an entity is incorporated to resolve questions relating to that entity’s internal affairs. These affairs encompass such matters as the election of directors, the rights of shareholders, and the fiduciary duties owed to shareholders. In a trio…
Continue ReadingFaux Forum Selection Clauses
In linguistics, a false friend (or faux ami) is a word from a different language that looks and sounds like a familiar word in English but, in fact, has a very different meaning. A classic example is the word “gift.” In English, the word means “present.” In German, the word means “poison.” These are not…
Continue ReadingAn Answer to the Billion-Dollar Choice-of-Law Question
On February 20, 2024, the New York Court of Appeals handed down its opinion in Petróleos de Venezuela S.A. v. MUFG Union Bank, N.A. The issue presented—which I described in a previous post as the billion-dollar choice-of-law question—was whether a court sitting in New York should apply the law of New York or the law…
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