Supporting Judicial Enforcement of a Choice of Forum Clause Requiring Plaintiff’s Claims Under the Massachusetts Wage Act to be Litigated in New York
At issue in this case was the enforceability of a forum selection clause in an out-of-state business’s employment contract with a Massachusetts executive employee. The plaintiff in the case is a Massachusetts resident; the defendant is his corporate employer, Zenhire, Inc., which is located in New York. Melia sued Zenhire in Massachusetts Superior Court for unpaid wages under Massachusetts law, even though his employment agreement requires all such claims to be adjudicated in the courts of New York and under New York substantive law. Despite the presumptive validity of forum selection clauses under Massachusetts law, Melia argued, in opposition to Zenhire’s motion to dismiss for improper venue, that the agreement’s forum selection clause should not be enforced because it operated in tandem with the choice of law clause to exempt Zenhire from liability under the Massachusetts Wage Act, contrary to Massachusetts public policy. The Superior Court rejected Melia’s arguments and enforced the forum selection clause, primarily because Massachusetts and New York both apply the same Restatement (Second) test in determining the validity of a choice of law clause. Melia appealed from the trial court’s dismissal, and the Massachusetts Supreme Judicial Court (“SJC”) took the case sua sponte for direct appellate review.
NELF filed an amicus brief in support of Zenhire, arguing that, since Massachusetts and New York follow the same Restatement (Second) test in determining the validity of a choice of law clause in a contract, enforcement of the forum selection clause was neither unfair nor unreasonable. That is, Melia would be just as free to challenge the validity of the New York choice of law clause in the courts of New York as in the courts of Massachusetts, and, for that reason, enforcement of the forum selection clause had no bearing on Melia’s challenge to the choice of law clause. Moreover, any doubts about the competence of the New York courts to recognize Massachusetts public policy in deciding the enforceability of the choice of law clause would be entirely speculative and would offend basic principles of interstate comity and reciprocity that animate both the United States Supreme Court’s and the SJC’s forum selection jurisprudence. NELF also pointed out that, consistent with the SJC’s instruction to evaluate the validity of a forum selection clause under the parties’ chosen law, the New York Court of Appeals has in fact rejected a virtually identical challenge to a forum selection clause brought by New York employees against their out-of-state employer. See Boss v. American Express Fin. Advisors, Inc., 844 N.E.2d 1142 (2006). Finally, NELF argued that a decision enforcing Zenhire’s forum selection clause would preserve the key principles of party autonomy and interstate comity that animate the modern view embracing forum selection clauses.
On May 8, 2012, the SJC issued its decision agreeing with NELF’s analysis and enforcing the forum selection clause. The Court also announced a demanding three-part test which a Massachusetts employee must satisfy to defeat a forum selection clause.
At issue in this case was the enforceability of a forum selection clause in an out-of-state business’s employment contract with a Massachusetts executive employee. The plaintiff in the case is a Massachusetts resident; the defendant is his corporate employer, Zenhire, Inc., which is located in New York. Melia sued Zenhire in Massachusetts Superior Court for unpaid wages under Massachusetts law, even though his employment agreement requires all such claims to be adjudicated in the courts of New York and under New York substantive law. Despite the presumptive validity of forum selection clauses under Massachusetts law, Melia argued, in opposition to Zenhire’s motion to dismiss for improper venue, that the agreement’s forum selection clause should not be enforced because it operated in tandem with the choice of law clause to exempt Zenhire from liability under the Massachusetts Wage Act, contrary to Massachusetts public policy. The Superior Court rejected Melia’s arguments and enforced the forum selection clause, primarily because Massachusetts and New York both apply the same Restatement (Second) test in determining the validity of a choice of law clause. Melia appealed from the trial court’s dismissal, and the Massachusetts Supreme Judicial Court (“SJC”) took the case sua sponte for direct appellate review.
NELF filed an amicus brief in support of Zenhire, arguing that, since Massachusetts and New York follow the same Restatement (Second) test in determining the validity of a choice of law clause in a contract, enforcement of the forum selection clause was neither unfair nor unreasonable. That is, Melia would be just as free to challenge the validity of the New York choice of law clause in the courts of New York as in the courts of Massachusetts, and, for that reason, enforcement of the forum selection clause had no bearing on Melia’s challenge to the choice of law clause. Moreover, any doubts about the competence of the New York courts to recognize Massachusetts public policy in deciding the enforceability of the choice of law clause would be entirely speculative and would offend basic principles of interstate comity and reciprocity that animate both the United States Supreme Court’s and the SJC’s forum selection jurisprudence. NELF also pointed out that, consistent with the SJC’s instruction to evaluate the validity of a forum selection clause under the parties’ chosen law, the New York Court of Appeals has in fact rejected a virtually identical challenge to a forum selection clause brought by New York employees against their out-of-state employer. See Boss v. American Express Fin. Advisors, Inc., 844 N.E.2d 1142 (2006). Finally, NELF argued that a decision enforcing Zenhire’s forum selection clause would preserve the key principles of party autonomy and interstate comity that animate the modern view embracing forum selection clauses.
On May 8, 2012, the SJC issued its decision agreeing with NELF’s analysis and enforcing the forum selection clause. The Court also announced a demanding three-part test which a Massachusetts employee must satisfy to defeat a forum selection clause.
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