Forum selection clauses have become a ubiquitous feature of modern contracts, an unsurprising development considering the benefits of convenience and predictability that such clauses can provide to the parties. But complex commercial disputes frequently involve non-parties to such agreements who may be surprised to find that they, too, may be bound by a forum selection clause in a given contract. New York courts allow non-parties to enforce or be bound by a forum selection clause where the non-signatory is (1) a third-party beneficiary of the agreement, (2) a party to a “global transaction” but not to a specific agreement within that transaction, or (3) “closely related” to a signatory.1
The application of these exceptions arose recently in Gottwald v. Sebert,2 a New York County Commercial Division case addressing the well-publicized contentious dispute between the popular recording artist Kesha and her former record producer “Dr. Luke,” also known as plaintiff Lukasz Gottwald.3 This column discusses the grounds under which non-parties to a contract may enforce or be bound by a forum selection clause, and reviews Gottwald and other recent Commercial Division cases that address and clarify the standards for applying these exceptions.
The Standard
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