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Out-Of-State Forum Selection Clause Void In Louisiana

Wednesday, August 01, 2012 05:42 am


Forum Selection Clause--Pay If Paid

E. Cornell Malone Corp. v. St. Mary's Academic of the Holy Family, 2012 U.S. Dist. Lexis 71890 (E.D. La. May 23, 2012)

Disputes arising from Louisiana construction projects, and involving Louisiana companies, must be litigated (but not arbitrated) within the state.

E. Cornell Malone Corp. (Malone) was the roofing subcontractor on a construction project at St. Mary's Academy Permanent High School Campus in New Orleans. Malone claimed that although it fully and satisfactorily completed its work, the general contractor, Satterfield & Pontikes Construction Group, LLC (S&P), failed to pay more than $100,000 due to the sub. Malone sued S&P's sureties as well as the project owner. However, the parties could not agree on the proper venue for their dispute.

The sureties moved to dismiss Malone's Louisiana suit because the forum selection clause contained in the subcontract required any disputes to be litigated in Harris County, Texas. The court noted that forum selection clauses are generally enforceable under federal law, and a party resisting enforcement "bears a 'heavy burden of proof.'" Ginter ex rel. Ballard v. Belcher, Pr [...]

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