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AOL Forum Selection Clause Contrary to Public Policy
On January 9, 2009, the U.S. Court of Appeals for the Ninth Circuit ruled that a forum selection clause found in AOL’s Member Agreement designating the “courts of Virginia” as the only forum to adjudicate disputes between AOL and its members was unenforceable against California residents, since it included only the state courts of Virginia. This ruling was made in the context of a class-action suit launched in California over AOL’s accidental release of the personal information of 650,000 of its members. AOL moved to have the action dismissed for improper venue, relying on the Virginia forum selection clause. The District Court granted AOL’s motion, but the Court of Appeals reversed. The Court of Appeals found that, since class actions were not available in Virginia, the clause amounted to a forced waiver of the right to participate in a class action. The Court of Appeals held the clause to be contrary to California public policy against waiving the right to bring class actions, and ruled that the clause was unenforceable against Californians.
For additional information, visit:
http://www.allbusiness.com/legal/trial-procedure-suits-claims/11759959-1.html