Business Law Journal

Paperwork is an inevitable and often tedious part of doing business.  When that paperwork becomes routine and time consuming, the natural inclination is to skim documents or rely on industry-developed shortcuts.  While this can save you time in the short-term, doing this risks exposing you and your company to massive liability. And while you can directly control your own actions, the risk of liability does not end there.  Many companies choose to outsource that paperwork to third-parties and trust them to do their jobs. But even when you have good practices internally, when the third parties that work for you do not follow best practices, you can still be put at risk.  The recent California Court of Appeals decision in Bergstrom v. Zions Bancorporation is a clear example of how reliance on third-party agents and a third-party’s use of shortcuts can expose your company to massive liabilities. 2022 WL 1419910 (2022).

More than ever, companies aspire to increase the reach of their businesses by opening secondary or satellite offices in different states.  While this can be an effective tool for expansion, it opens the business to potential liability in multiple forums which may have different or contradicting rules and regulations, particularly when addressing the rights of employees. As with many legal complexities associated with cross-border transactions, one of the most common ways to limit this uncertainty is through the use of forum selection clauses—contractual provisions which dictate the applicable law or potential legal forums for disputes arising out of those contracts.