Business Law Journal

Background 

In EpicentRx, Inc. v. Superior Court of San Diego County, the California Supreme Court considered whether a forum selection clause requiring litigation outside of California could be invalidated solely because it incidentally waived the plaintiff’s right to a jury trial under California law. The case involved a minority shareholder who filed suit against a corporation, its controlling shareholder, and other defendants, alleging breach of contract, fraudulent concealment, and various other claims. At issue was a contractual forum selection clause designating the Delaware Court of Chancery as the exclusive venue for resolving disputes. 

When the plaintiff filed suit in the Superior Court of San Diego County, the defendants moved to dismiss the action based on mandatory forum selection clauses contained within the corporation’s bylaws and certificate of incorporation. The defendants contended that California was an improper forum and that, pursuant to the bylaws and certificate of incorporation, all contract-related claims must be litigated in the Delaware Court of Chancery. In response, the plaintiff emphasized that all defendants were based in California and that the conduct giving rise to the claims occurred primarily in San Diego.

The trial court denied the defendants’ motion to dismiss, reasoning that under the rules of the Delaware Court of Chancery jury trials are not available. As a result, the court found that the forum selection clause operated as a de facto pre-dispute waiver of the plaintiff’s right to a jury trial, contrary to California law. Citing the California Constitution and state public policy favoring the right to trial by jury, the court ruled the clause unenforceable. The defendants appealed, however, the Court of Appeal affirmed. 

The California Supreme Court granted review and ultimately reversed and remanded for further proceedings at the trial court. The central question before the High Court was whether California’s constitutional and statutory protections of the right to jury in civil disputes invalidates a forum selection clause designating a jurisdiction that does not offer an equivalent jury trial right. 

The Enforceability of Forum Selection Clauses  

The California Supreme Court reaffirmed that forum selection clauses are generally enforceable unless they are shown to be unfair or unjust (i.e., if procured by fraud). An exception exists where enforcement would contravene a fundamental public policy of California. While the right to a jury trial is indeed a core component of California public policy, the Supreme Court held that it is a procedural right, not a substantive one. As such, the right does not travel with the parties to extend beyond California courts. 

The Supreme Court distinguished between an impermissible pre-dispute waiver of the right to a jury trial and a forum selection clause that incidentally results in the unavailability of a jury trial in the chosen forum. It concluded that the latter is not equivalent to a waiver. Emphasizing that forum selection clauses determine where a case will be litigated, not how, the Court declined to treat such clauses as violating California policy merely because they may limit procedural rights in the foreign jurisdiction. 

Importantly, the Supreme Court considered the value of arm’s length negotiations in contract formation. For example, the Court pointed to the possibility that the choice of forum may figure centrally in a negotiation. Forum selection clauses may affect how parties set monetary and other contractual terms and may be a critical factor in parties deciding to do business together. Therefore, the Court found “[i]n all but the most unusual cases … the interest of justice is served by holding parties to their bargain.” EpicentRX v. Superior Court of San Diego, 2025 WL 2027272, at *8 (Cal., 2025). 

It is important to note, however, that the Court acknowledged specific circumstances in which forum selection clauses may indeed violate California public policy. These include cases involving California franchise agreements, employment agreements, and situations where enforcing the clause would effectively deprive a plaintiff of any remedy in the chosen forum. 

Conclusion  

This ruling clarifies that while California strictly regulates the waiver of jury trials within its courts, it does not prohibit parties from contracting to litigate elsewhere—even if that means giving up procedural protections like a jury trial. For businesses and individuals drafting contracts governed by California law, this decision reinforces the enforceability of properly drafted forum selection clauses and the importance of evaluating the effect agreeing to select a forum may have on future claims. 

If you are negotiating or enforcing contracts that involve out-of-state or international elements, or if you are unsure how procedural rights like jury trials may affect your dispute resolution strategy, professional legal guidance is essential. Contact the authors of this article to ensure your agreements protect your interests wherever litigation may arise.

This AALRR publication is intended for informational purposes only and should not be relied upon in reaching a conclusion in a particular area of law. Applicability of the legal principles discussed may differ substantially in individual situations. Receipt of this or any other AALRR publication does not create an attorney-client relationship. The Firm is not responsible for inadvertent errors that may occur in the publishing process.

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