United States: New Case Demonstrates The Importance Of Forum Selection Clauses

On November 4, 2013, the U.S. District Court for the Northern District of California denied a motion filed by a company to dismiss a lawsuit brought by a former Libya-based employee.  This decision ended the company's unsuccessful attempts to remove to the Libyan judicial system a complaint filed in U.S. federal courts.  The ruling, and a companion decision issued two months earlier, serves as a reminder of the need to include well-crafted forum selection clauses in employment agreements, particularly in the international context.    

Factual Background

In February 2010, the company entered into an employment agreement ("2010 employment agreement") with a U.S. citizen of Libyan national origin to work as a marketing lead for its Libyan entity.  The February 2010 agreement contained both a forum selection clause designating Libyan courts as having jurisdiction, and a choice of law provision selecting Libyan law as governing.  The individual and the company entered into a second employment agreement effective January 1, 2011 ("2011 employment agreement").  Unlike the first employment agreement, the 2011 employment agreement contained a choice of law provision but was silent about a forum for disputes.    

The employee worked for the company in Tripoli from February 1, 2010 until February 27, 2011 when he was evacuated following the eruption of the Libyan revolution.  In March 2011 the company attempted to reassign the employee to Dubai, but he refused to go.  Alleging that he had been traumatized by the violence he observed during the Libyan revolution, the employee sought a postponement or modification of his work duties on the grounds that he suffered from post-traumatic stress disorder.  On December 1, 2011, the company terminated the employee for failure to find a new job within the organization for which he was qualified.    

Procedural History

On January 10, 2013, the former employee filed a complaint in the U.S. District Court for the Northern District of California ("Complaint")1 alleging violations of the Americans with Disabilities Act, the Family and Medical Leave Act, California's Fair Employment and Housing Act, the California Family Rights Act and for breach of his 2011 employment agreement.  The company moved to dismiss the Complaint on the basis of improper venue due to a purported implied forum selection clause and for forum non conveniens.  In September 2013, the court denied the company's motion to dismiss as to improper venue and ordered additional briefing on the issue of forum non conveniens.         

The Opinions

Implied Forum Selection Clause

In its motion to dismiss, the company claimed that the selection of Libyan law as governing the 2011 employment agreement implicitly granted Libyan courts jurisdiction over any disputes arising out of the employment relationship.  Nevertheless, the 2011 employment agreement contained no explicit language regarding forum, providing only that:

This Agreement is subject to the provisions of the Labor Law No. (58) for the year 1970 Gregorian and its amendments and the law on Social Solidarity No. (13) for the year 1980 Gregorian and its amendments and all other decision, decree or regulation which have not been specifically mentioned in this Agreement.

The company argued that under the Libyan Labor Law, "all labor and employment disputes are subject to a mandatory and exclusive conciliation, arbitration, and litigation process."  It contended that by subjecting the employment relationship to, and incorporating provisions of, Libyan Labor Law, the parties had automatically, albeit not explicitly, selected Libya as the proper forum.

The court denied the motion based on the supposed implied forum selection clause.  It held that as a threshold issue, there was no basis to find that the parties had agreed to a forum selection clause, either (i) on the face of the 2011 employment agreement or (ii) through the incorporation of Libyan Labor Law.  Further undercutting the employer's argument was the fact that the parties had included a forum selection clause in the 2010 employment agreement, but failed to do so one year later.  Article 14 of the 2010 employment agreement explicitly provided that "Libyan courts shall have jurisdiction to decide any dispute that may arise in the future between the parties involved in this agreement."  The omission of this or similar language from the 2011 employment agreement was confirmation that, on its face, the 2011 employment agreement did not contain a forum selection clause.

On the argument about an alleged implied forum selection clause, the court looked to the language of Libyan Labor Law to determine whether it mandated the exclusive jurisdiction of Libyan courts over the employment relationship.  It held:

[T]he purported forum selection mechanism in sections 101-109, however, does not contain the word "mandatory" or "exclusive." Notwithstanding [the company's] legal conclusions that sections 101-109 amount to a forum selection clause, the plain language of sections 101-109 is inconsistent with the clear and unequivocal language typical of forum selection clauses in agreements that have been evaluated for enforceability...in controlling Ninth Circuit cases.

Thus, the court found that there was no forum selection clause to enforce and denied the motion to dismiss on that regard.                  

Forum Non Conveniens

Once the argument about the forum selection clause was denied, the court granted the plaintiff an opportunity to submit supplemental briefing and evidence "addressing the adequacy of Libya as an alternative forum," indeed threatening to grant the motion to dismiss if the plaintiff did not do so.  On November 4, 2013, the court denied the remainder of the company's motion to dismiss because it was unable to establish: (i) the adequacy of the alternative forum; and (ii) the balance of private and public interest factors favors dismissal.    

On the issue of forum non conveniens, the employer argued that the plaintiff's choice of a United States court was "entitled to minimal deference" because the plaintiff:

had every reason to expect that any litigation arising from his employment relationship would be conducted in Libya before the Libyan courts...Plaintiff's employment agreement was expressly made subject to the laws of Libya and he agreed to submit to the mandatory and exclusive adjudicative process for labor and employment disputes in Libya...[and] the record is clear that this action arises out of Plaintiff's employment in Libya by a Libyan entity. 

The company went on to argue that litigating the Complaint in California posed a substantial burden because the plaintiff's direct supervisor, co-workers, and the relevant human resources personnel were all located either in Libya or elsewhere in North Africa and the Middle East.

The court agreed that Libya was an adequate forum because first, the company had agreed to accept process in Libya as a condition of the plaintiff dismissing the Complaint in California.  Second, a satisfactory remedy was available in Libya because there was evidence that the judiciary was up and running despite the revolution, and the company had agreed to waive any statute of limitation defense if the Complaint were dismissed on the grounds of forum non conveniens

However, the second prong of the analysis required the court to decide whether Libya was an adequate forum in this particular situation by balancing the private and public interests.2  In performing its balancing act, the court made generalized determinations rather than providing a detailed analysis of the actual costs and burdens of litigating in either forum.  For example, in considering the forum's convenience to the litigants, the court recognized that the plaintiff could not financially afford to travel to Libya.  On the other hand, the company would have to cover the travel costs of witnesses, if any, traveling from Libya to California.  Rather than reviewing the actual numbers to determine which party could anticipate the higher costs and higher financial inconvenience, alternative methods of obtaining discovery and the like, the court deemed that both parties would be inconvenienced, rendering the factor neutral.  Broad presumptions of this sort were characteristic of the entire analysis.      

As to the public factors, the court appeared reluctant to relinquish a case which turned primarily on alleged violations of U.S. federal and state law. The court did not find that the case would "impose costs so great as to...favor...dismissal to the Libyan forum for the mere sake of convenience when Plaintiff has alleged substantive violations of federal law."

Neither was the court swayed by the fact that, by contract, the employment relationship was purportedly governed by Libyan law.3 When weighing this public interest factor, the court found that it could familiarize itself with Libyan law through translated documents and with the aid of declarations from Libyan counsel.  Similarly, the court recognized that a Libyan court would be required to familiarize itself with federal and California law to address the plaintiff's full spectrum of claims. Thus, this public interest factor was considered neutral.         

In the end, the court found that "the majority of private and public interest factors are neutral, and some tip in favor of Plaintiff's choice of forum."  Thus, the company "failed to meet its burden of showing that Plaintiff's choice of forum...results in 'oppressiveness and vexation...out of all proportion'... such that Plaintiff's case should be dismissed on the basis of forum non conveniens."

The Implications

The lesson that employers should take from this decision is that explicit forum selection clauses are integral to a well-drafted employment agreement, and essential to international employment agreements. This is the case regardless of whether the company is hiring the employee in the first instance, renewing that agreement, or entering into a secondment agreement under which the employee will be working for a foreign subsidiary or affiliate. If the company wants to make sure that disputes are heard in a particular forum, it must designate that forum in the agreement and must do so explicitly.  Here, omitting the forum selection clause from the 2011 employment agreement, for no reason explained on the record, caused the company to engage in extended motion practice in an ultimately unsuccessful effort to establish through implication what the 2010 agreement provided explicitly.  However, had the employer included a forum selection clause in the 2011 employment agreement, it would likely have been able to control the location of the lawsuit and minimize the risk of defending the claim in California.  Ultimately, straightforward and clear forum selection clauses allow employers to control the location of lawsuits and reduce the risk of defending a lawsuit in an "inconvenient forum."


1. Kedkad v. Microsoft Corporation, Inc., et al., Case No. 3:13-cv-00141-TEH (N.D. Ca. Jan. 10, 2013) (complaint filed). 

2. The private interests considered by the court were: "(1) the residence of the parties and the witnesses; (2) the forum's convenience to the litigants; (3) access to physical evidence and other sources of proof; (4) whether unwilling witnesses can be compelled to testify; (5) the cost of bringing witnesses to trial; (6) the enforceability of the judgment; and (7) all other practical problems that make trial of a case easy, expeditious and inexpensive."  The public interest factors included: (1) local interest in the lawsuit; (2) the court's familiarity with governing law; (3) the burden on local courts and juries: (4) congestion in the court; and (5) the costs of resolving a dispute unrelated to this forum.

3. The discussion and finding were focused on familiarity with the law rather than applicability.  The merits of whether Libyan, federal or California law actually applied was not at issue.   

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.