322 F. Supp. 3d 45
D.C. Cir.2018Background
- DSCI (a New Jersey corporation) contracted with the Kingdom of Saudi Arabia (KSA) for services performed in Saudi Arabia (Aug 2013–Apr 2015); contract drafted in Arabic and governed by Saudi law.
- DSCI later became insolvent; its restructuring officer discovered two unbilled invoices for work under the KSA contract and submitted them; KSA refused to pay.
- DSCI sued KSA in D.C. Superior Court for breach of contract and unjust enrichment; KSA removed to federal court and moved to dismiss on forum non conveniens grounds.
- The contract contains a forum-selection clause assigning disputes to the “grievance council” (Board of Grievances in Saudi Arabia); other contract indicia point to Saudi performance, Arabic records, and Saudi currency.
- DSCI argued the clause was permissive and that Saudi Board of Grievances was an inadequate forum; KSA argued the clause is mandatory and public-interest factors favor dismissal.
- The district court granted KSA’s motion, holding the forum-selection clause mandatory and finding public-interest factors did not overwhelmingly disfavor dismissal; the court did not reach foreign sovereign immunity subject-matter jurisdiction issues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the forum-selection clause is mandatory or permissive | Clause is permissive because it does not expressly exclude other forums | Clause is mandatory because it broadly assigns "any disputes" to the grievance council | Mandatory; clause is broad and "all-encompassing" and therefore enforceable |
| Whether public-interest factors warrant refusing enforcement | Public-interest objections focus on inconvenience of litigating in Saudi Arabia | Public-interest factors (witnesses/docs in Saudi, Saudi law governing contract, Saudi interest) favor dismissal | Public-interest factors do not overwhelmingly disfavor dismissal; dismissal appropriate |
| Adequacy of Saudi Board of Grievances as alternative forum | Saudi Board is inadequate (DSCI argued) | Saudi Board is adequate and has jurisdiction over government contract claims | Court did not need to decide adequacy because clause is mandatory; noted it would find Board adequate if reached the issue |
| Whether to resolve subject-matter jurisdiction before forum non conveniens | Implicitly: plaintiff proceeded in U.S. forum | Defendant reserved FSIA immunity challenge if dismissal denied | Court resolved forum non conveniens first and dismissed; did not reach FSIA subject-matter jurisdiction issue |
Key Cases Cited
- Piper Aircraft Co. v. Reyno, 454 U.S. 235 (establishes doctrine of forum non conveniens in federal courts)
- Sinochem Int'l Co. Ltd. v. Malaysia Int'l Shipping Corp., 549 U.S. 422 (permits dismissal on forum non conveniens without first resolving jurisdictional questions)
- Atl. Marine Constr. Co. v. U.S. Dist. Ct. for the W. Dist. of Tex., 571 U.S. 49 (forum-selection clauses carry controlling weight; public-interest factors must "overwhelmingly" disfavor dismissal to avoid enforcement)
- Marra v. Papandreou, 216 F.3d 1119 (D.C. Cir. 2000) (characterizes broadly worded forum clause as mandatory even without the word "exclusive")
- Stone & Webster, Inc. v. Georgia Power Co., 779 F.3d 614 (D.C. Cir. 2015) (contrast: clause explicitly labeled "non-exclusive" is permissive)
- M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (forum-selection clauses can be "clearly mandatory and all-encompassing")
- Gulf Oil Corp. v. Gilbert, 330 U.S. 501 (identifies public-interest factors considered in forum non conveniens analysis)