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Lauro Lines v. Chasser

Supreme Court of the United States · 1989 · Civil Procedure

Civil ProcedureAppellate JurisdictionFinal Judgment RuleCollateral Order DoctrineForum-Selection Clauses28 U.S.C. § 1291final decisioninterlocutory appeal

Facts

The respondents were passengers aboard, or representatives of passengers aboard, the Achille Lauro when terrorists hijacked it in the Mediterranean in October 1985. They sued Lauro Lines, the Italian owner of the ship, in the Southern District of New York for injuries from the hijacking and for the wrongful death of Leon Klinghoffer. Lauro Lines moved to dismiss before trial based on a forum-selection clause printed on each passenger ticket that purported to require any suit connected with the contract to be brought in Naples, Italy, and to waive suit elsewhere. The district court denied dismissal because the ticket as a whole did not give reasonable notice that passengers were waiving the opportunity to sue in a domestic forum.

Issue

Whether a district court's interlocutory order denying a defendant's motion to dismiss a damages action based on a contractual forum-selection clause is immediately appealable under 28 U.S.C. § 1291 as a collateral final order. More specifically, the question was whether such an order is effectively unreviewable on appeal from a final judgment.

Rule

Under 28 U.S.C. § 1291, an interlocutory order denying dismissal based on a contractual forum-selection clause is not immediately appealable under the collateral order doctrine unless it satisfies Cohen's requirements, including that the order be effectively unreviewable on appeal from a final judgment. An order is effectively unreviewable only when it implicates an asserted right whose legal and practical value would be destroyed if not vindicated before trial; a claimed right to be sued only in a particular forum is not such a right.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Nora Feldman sued Harbor Peak Tours, a fictional travel company, in federal district court in Seattle for damages arising from a canceled expedition. Harbor Peak moved to dismiss based on a contract clause requiring any litigation to be brought in Lisbon, Portugal, but the district court denied the motion. Harbor Peak filed an immediate appeal under 28 U.S.C. § 1291 without seeking any other avenue of interlocutory review.

Should the court of appeals hear the appeal immediately under the collateral order doctrine?

Explanation. Under the majority rule, an order denying dismissal based on a contractual forum-selection clause is interlocutory and not immediately appealable under § 1291 unless it satisfies Cohen. Even assuming separateness and conclusiveness, the order fails the third requirement because the asserted right to be sued only in a particular forum can be adequately vindicated on appeal after final judgment. Extra litigation burdens do not make the order effectively unreviewable. (Derived from Lauro Lines v. Chasser (1989).)