CONFLICTS OF LAW-CHOICE OF LAW-FORUM SELECTION CLAUSE-INTENDED THIRD PARTY BENEFICIARY TO THE CONTRACT

November 28th, 2018 by Rieders Travis in Miscellaneous

In re McGraw-Hill Global Educ. Holdings, LLC, 2018 U.S. App. LEXIS 32931 (3d Cir. November 21, 2018) Smith, C.J.  These consolidated mandamus petitions require us to decide whether two professional photographers bringing separate copyright infringement actions are bound by a forum selection clause in contracts they did not sign. We conclude that the photographers are not bound because they are not intended beneficiaries of the agreements, nor are they closely related parties. Our conclusion means that one District Court got it right, and the other got it wrong. But mandamus is an extraordinary remedy. Because the erring District Court’s mistakes were not clear or indisputable, we decline to issue the writ.

A non-signatory may be bound by a contractual forum selection clause if he is an intended third-party beneficiary to the contract. DuPont, 269 F.3d at 195 (citing Coastal Steel Corp., 709 F.2d at 202–04). The New York Court of Appeals has adopted the Restatement (Second) of Contracts for determining third-party beneficiary status. Subaru Distribs. Corp. v. Subaru of Am., Inc., 425 F.3d 119, 124 (2d Cir. 2005) (citing Fourth Ocean Putnam Corp. v. Interstate Wrecking Co., 485 N.E.2d 208, 212 (N.Y. 1985)).

Article Categories