In Grafton Partners L.P. v. Superior Court, 36 Cal.4th 944 (2005), the California Supreme Court found that pre-dispute contractual jury trial waivers were unconstitutional under Article 1, Section 16 of the California Constitution. In 2019, I penned a post discussing a case in which the Court of Appeal invalidated a forum selection clause that included a jury trial waiver. Last week, the interplay between a pre-dispute jury waiver and forum selection was again at issue.
In Comedy Store v. Moss Adams LLP, 2024 WL 4783868 (Cal. Ct. App. Nov. 14, 2024), the parties agreed to litigate in federal court in Los Angeles. When the U.S. District Court dismissed the action for lack of jurisdiction, the plaintiff filed a complaint in the California Superior Court. The defendant responded by bring a motion to dismiss or stay the action based on improper venue, citing the parties' written agreement to resolving disputes in the state or federal court in King County, Washington. That same agreement included a waiver the right to a jury trial. The trial court granted the defendant's motion and ordered the defendant to provide the plaintiff with a stipulation providing that plaintiff is entitled to exercise its right to a jury trial in any future action arising filed in Washington State.
The Court of Appeal reversed, holding that the trial court had improperly placed the burden upon the plaintiff to show that the State of Washington provided the plaintiff with the same or greater rights or that a Washington court would apply California law to decide the enforceability of the jury trial waiver. The Court of Appeal found that the effect of the court-ordered stipulation would be to encourage parties to continue to include jury trial waivers in their agreements and simply wait and see whether they will be challenged.
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