California Supreme Court Holds Right to Jury Trial Does Not Bar Enforcement of a Delaware Forum Selection Clause
On July 21, 2025, the California Supreme Court issued a decision in EpicentRX v. Superior Court, reversing a decision by the California Fourth District Court of Appeal that declined to enforce a forum selection clause in a corporation’s certificate of incorporation and bylaws designating the Delaware Court of Chancery as the mandatory forum. As we reported at the time, the Court of Appeal concluded that because the Delaware Court of Chancery, as a court of equity, does not conduct jury trials, the forum selection clause in favor of the Delaware forum ran afoul of California’s “sacred” right to a jury trial and thus was unenforceable. In reversing, the California Supreme Court rejected this reasoning in its entirety, holding that “A forum selection clause is not unenforceable simply because it requires the parties to litigate in a jurisdiction that does not afford civil litigants the same right to trial by jury as litigants in California courts enjoy.”
Plaintiff, a minority stockholder, asserted claims against the corporation, EpicentRX, and certain directors, officers, and employees for fraudulent concealment, promissory fraud, breach of contract, breach of fiduciary duty, and claims under the California Unfair Competition Law. Defendants moved to dismiss on the basis of forum non conveniens, asserting the enforceability of the forum selection clause in favor of Delaware. The trial court ruled that the forum selection clause operated as a de facto predispute waiver of the right to a jury trial, which California public policy prohibits. Defendants took a writ of mandamus to the Fourth District Court of Appeal, arguing that the forum selection clause was an agreement to avoid the California forum entirely, not an express jury trial waiver. The Court of Appeal, shifting the burden to defendants to prove that plaintiff’s right to a jury trial would be upheld in the Court of Chancery (which would not be possible), affirmed the trial court. Defendants petitioned the California Supreme Court for review.
In reversing, the California Supreme Court reaffirmed that it favors enforcement of forum selection clauses that have been freely and voluntarily negotiated between parties. While courts “should refuse to enforce a forum selection clause” that is contrary to a “strong or fundamental public policy of the state,” courts should be reluctant to do so “where no statute or constitutional provision directly speaks to the issue.” The court then catalogued instances where the state legislature had written into statutes that enforcement of a forum selection clause would violate public policy. None applied to the claims at issue in this case. In contrast, the court noted that no California statute or constitutional provision expressly prohibits enforcement of a forum selection clause that would result in a plaintiff litigating in a forum that lacked a right to a jury trial. Indeed, California courts have repeatedly enforced forum selection clauses in favor of foreign jurisdictions that lack a right to a jury trial. Though California does have a strong public policy favoring jury trials, that policy and related state statutes and constitutional provisions “concern the right to a jury trial in California courts, not elsewhere.”
The court also rejected the lower courts’ analysis that the forum selection clause amounted to a predispute jury trial waiver. Rather, the court reasoned the forum selection clause reflects where a dispute will be litigated — not how it will be litigated — and under California law parties are free to agree to avoid the California forum altogether. Thus the court concluded that the limitations on the ability to waive the right to a jury trial contained in the California Code of Civil Procedure are limitations solely on courts operating in California. “They do not announce a public policy against predispute jury trial waivers writ large, untethered to their enforcement in a California forum.” To the contrary, “California does not have a strong public policy against forum selection clauses or agreements to litigate in a jurisdiction that does not recognize the same civil jury trial right.”
The California Supreme Court concluded with a note of caution: its decision was limited to the question of whether the forum selection clause should not be enforced based on public policy grounds related to the right to a jury trial. Plaintiff had raised other objections, including that the relevant forum selection clauses in the certificate of incorporation and bylaws were adopted without its consent and only after the conduct forming the basis for the lawsuit’s claims had been discovered. However, those issues were not litigated in the Court of Appeal, and the Supreme Court declined to consider them for the first time.
Nonetheless, the California Supreme Court’s decision is significant in aligning California with the vast majority of states that enforce forum selection clauses in favor of the Delaware Court of Chancery. This approach further reinforces Delaware’s own policy favoring such clauses in the certificates of incorporation and bylaws of Delaware companies.
This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.
