Orange, S.A. v. United States District Court
2016 U.S. App. LEXIS 6428
| 9th Cir. | 2016Background
- Telesocial, a San Francisco start‑up, developed a mobile app called “Call Friends” enabling social‑network users to make phone calls without phone numbers. Orange (French telecom) negotiated with Telesocial in 2012 and received access to a demo (including an overseas password).
- On April 25, 2012, the parties executed an NDA containing a forum‑selection clause requiring disputes to be submitted to the Court of Paris and governed by French law; the NDA protected disclosed confidential information but excluded information already in the receiving party’s possession.
- Negotiations broke down in 2012; Telesocial alleges Orange thereafter accessed the app using fictitious names and hacked servers, then launched a competing product. Telesocial sent a cease‑and‑desist and later sued in California asserting CFAA and state tort and trade‑secret claims. Orange sued in France earlier and lost on dismissal/appeal.
- Orange moved to dismiss Telesocial’s First Amended Complaint (FAC) on forum non conveniens grounds, arguing the NDA’s forum‑selection clause covers Telesocial’s claims. The district court denied the motion, finding the claims factually distinct from the NDA.
- Orange petitioned this Court for a writ of mandamus directing dismissal. The Ninth Circuit applied the Bauman mandamus factors and denied the petition, concluding mandamus was not warranted.
Issues
| Issue | Plaintiff's Argument (Orange) | Defendant's Argument (Telesocial) | Held |
|---|---|---|---|
| Whether the NDA’s forum‑selection clause covers Telesocial’s claims | The clause’s broad language (“arising out of or relating to”) covers all disputes tied to the agreement, so the case should be litigated in Paris | Claims arise from tortive misuse/hacking and Telesocial’s Terms of Use, not from the NDA; resolving them does not require interpreting the NDA | Court held district court did not clearly err; clause did not cover the FAC claims |
| Whether mandamus is appropriate to compel dismissal after denial of forum non conveniens | Mandamus is needed because denial is not immediately appealable and Orange would face irreparable prejudice and forum‑shopping consequences | Orange has adequate later appellate remedies; interim litigation costs are insufficient to justify mandamus | Court held Orange has other adequate means (appeal after final judgment) and harm is not irreparable; mandamus denied |
| Whether district court’s interpretation conflicts with precedents (e.g., Simula, Manetti‑Farrow) | District court improperly narrowed forum clause scope, enabling artful pleading to avoid clause | District court correctly distinguished Simula (which favored broad arbitration clauses) and applied the correct test for forum clauses | Court held district court’s analysis aligned with precedent and was not a judicial usurpation of power |
| Whether the order raises a novel, important issue for international commerce | Ruling risks undermining enforceability of forum clauses and harms international business certainty | Decision is fact‑specific and does not alter precedents governing arbitration or forum clauses broadly | Court found no novel, controlling legal issue warranting mandamus |
Key Cases Cited
- Bauman v. United States, 557 F.2d 650 (9th Cir. 1977) (sets five‑factor test for issuing mandamus)
- Atlantic Marine Constr. Co. v. United States District Court, 134 S. Ct. 568 (2013) (forum‑selection clauses are entitled to controlling weight in forum non conveniens analysis)
- Simula, Inc. v. Autoliv, Inc., 175 F.3d 716 (9th Cir. 1999) (arbitration clauses construed broadly; disputes that "touch matters" covered by contract are arbitrable)
- Manetti‑Farrow, Inc. v. Gucci Am., Inc., 858 F.2d 509 (9th Cir. 1988) (analysis whether tort claims require interpretation of contract to determine applicability of forum clause)
- Cheney v. United States District Court, 542 U.S. 367 (2004) (mandamus requires absence of other adequate means to obtain relief)
- Van Cauwenberghe v. Biard, 486 U.S. 517 (1988) (denial of forum non conveniens dismissal is not a final appealable order)