Interpreting Choice-of-Law Clauses Waiving Sovereign Immunity
The Foreign Sovereign Immunities Act provides that a foreign state shall not be immune if it has “waived its immunity either explicitly or by implication.” Over the past forty years, U.S. courts have consistently held that a choice-of-law clause selecting the law of a U.S. state constitutes an implied waiver of foreign sovereign immunity. In…
Continue ReadingPrenuptial Agreements and Choice-of-Law Clauses
Choice-of-law clauses began appearing in prenuptial agreements long before they showed up in most other types of contracts. As early as 1874, Isabella Robinson and John Warner selected the law of Illinois to govern their prenup. The popularity of such clauses in this context is easy to understand. When the bride is domiciled in one…
Continue ReadingGreat Lakes in Action
On February 21, 2024, the U.S. Supreme Court decided Great Lakes Insurance SE v. Raiders Retreat Realty Co., LLC. Loyal readers will remember (see here and here and here and here) that this case presented the question of what test to apply to determine the enforceability of a choice-of-law clause governed by federal maritime law….
Continue ReadingUnilateral Choice-of-Law Clauses
Over the past decade, so-called “unilateral” or “asymmetric” forum selection clauses have attracted a lot of attention. A unilateral forum selection clause does not name a court in which to resolve disputes at the time of signing. Instead, it gives one contracting party the right to unilaterally select a court after the dispute arises. In…
Continue ReadingAnti-Comity and N.Y. General Obligations Law 5-1401
Not many statutes can fairly be described as bruisers. Section 5-1401 of New York General Obligations Law is an exception. In the immortal words of The Bachelor: “Section 5-1401 didn’t come here to make friends.” The purpose of Section 5-1401 is to generate business for New York lawyers and maintain New York’s status as a…
Continue ReadingGanpat’s Saga Continues
Regular TLB readers may recall the tragic story of Kholkar Vishveshwar Ganpat, an Indian citizen and merchant seaman who lost his toes to malaria, allegedly because his ship failed to stock sufficient antimalarial medicine when it docked at Savannah, Georgia. In 2018, Ganpat sued the ship’s operator, Singapore-based Eastern Pacific Shipping (EPS), in federal district…
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…
Continue ReadingU.S. Supreme Court Decides Great Lakes
On February 21, 2024, the U.S. Supreme Court handed down its decision in Great Lakes Insurance SE v. Raiders Retreat Realty Company, LLC. The question presented was whether, under federal admiralty law, a choice-of-law clause in a maritime contract can be rendered unenforceable if enforcement is contrary to the “strong public policy” of the state…
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