Choice of Forum Clause Compels Remand of Case to State Court

                   Choice of Forum Clause Compels Remand of Case to State Court

The specific wording of a choice of forum provision in an agreement may dictate whether or not the suit may (or may not) be removed to federal court. In this case, that is what happened. Grand Isle Shipyard, L.L.C. v. Siroco, LLC, 2025 WL 3157572 (E.D. La. Nove. 11, 2025).

This dispute arose out of computer services contract; Grand Isle filed suit against Siroco for a breach whose nature is not revealed in this decision. Siroco removed the action to federal court. In turn Grand Isle sought to remand the action to the Louisiana state court on the basis that (i) diversity jurisdiction was not present and (ii) the contract at the center of the suit preluded the removal. The court would address only the second argument. 

After reviewing Fifth Circuit law as to whether and how the right of removal may be made, the court recited the applicable terms of the contract, namely:

13. APPLICABLE LAW and Exclusive Venue. The Contract Documents shall be governed by the general maritime laws of the United States to the maximum extent permitted by law. If the general maritime law is held inapplicable, the Contract Documents shall be governed by the laws of the State of Louisiana regardless of any conflict of law provisions. The Parties hereto agree that the sole and exclusive venue with respect to any claim or controversy arising under or governed by this [sic] Contract Documents shall only be proper in the United States Federal District Court of the Eastern District of Louisiana located in New Orleans, Louisiana, regarding general maritime claims and the Louisiana Seventeenth Judicial District Court located in Thibodaux, Louisiana, regarding any claim not governed by the general maritime laws of the United States. Id., *2.

Applying the law as to waiver, the court wrote, “[F]or Plaintiff’s motion to remand to be successful, the above provision must represent an exclusive or mandatory venue clause. After reviewing a member of other cases addressing whether particular language vested exclusive jurisdiction in a particular court to the exclusion of any other, including a federal court to which removal might be sought, found:

Because Plaintiff and Defendant clearly demonstrated their intent to make jurisdiction exclusive in one of two courts, depending on the type of claim at issue, the parties have waived their right to remove claims that are not governed by the general maritime laws of the United States, which claims must be litigated in the 17th Judicial District Court located in Thibodaux, Louisiana. Id., *3.

The court then disposed of Siroco’s argument that the state court exclusivity provision applies only if and after there has been determination that the dispute is not maritime in nature.

On the facts that the contract did not involve any “maritime nexus,” it wrote “While the Court acknowledges that there might be ‘close’ cases when determining whether a contract is maritime, this is not one of them.” Id. *4.

Grand Isle’s request for remand was granted.