California Supreme Court Holds That Loss of Jury Trial Cannot Be Sole Reason to Deny Enforcement of Exclusive-Forum Provision

The California Supreme Court recently ruled that California courts should not refuse to enforce forum-selection provisions solely because a jury trial would not be available in the designated forum. The decision in EpicentRx, Inc. v. Superior Court of San Diego County (Cal. July 21, 2025) recognized the importance of the right to a jury trial under California law but held that the right applies only to jury trials in California and therefore cannot be the sole basis for refusing to enforce a forum-selection provision requiring litigation in the Delaware Court of Chancery, where a jury trial would not be available.

However, the Court left open the possibility that the loss of a jury trial, “in combination with other factors,” could be “relevant” to a court’s decision whether to enforce a forum-selection clause. The lower courts presumably will explore that issue on remand. The Court’s decision could also add to the ongoing debate in federal courts about the enforceability of forum-selection provisions that would entirely preclude assertion of claims that are subject to exclusive federal jurisdiction and therefore cannot be litigated in state courts.

Background

EpicentRx is a Delaware company headquartered in California. A shareholder sued the company and various individuals alleging that the defendants had engaged in misconduct in soliciting and investing money from shareholders. The complaint, filed in California state court, asserted claims for breach of contract, fraudulent concealment, promissory estoppel, breach of fiduciary duty, and violations of California’s Unfair Competition Law.

Defendants moved to dismiss the complaint under the forum non conveniens doctrine based on exclusive-forum clauses in EpicentRx’s charter and bylaws. Those clauses designated the Delaware Court of Chancery as the exclusive forum for shareholder actions asserting (i) derivative claims, (ii) claims for breach of fiduciary duty, (iii) claims under Delaware’s General Corporation Law or EpicentRx’s corporate documents, and (iv) claims governed by the internal-affairs doctrine.

The trial court denied defendants’ motion, holding that plaintiff was entitled under California’s Constitution to a jury trial on some of its claims and that such a right could be waived only through statutorily prescribed post-suit procedures, but not through a pre-dispute contractual agreement such as a charter or bylaw provision. A jury trial, however, was not available in the Delaware Court of Chancery. The court therefore held that enforcement of the exclusive-forum provision would violate California public policy. The California Court of Appeal (Fourth District) affirmed.

The California Supreme Court granted review and unanimously reversed.

California Supreme Court’s Decision

The Supreme Court began with the principle that forum-selection clauses will typically be enforced absent a showing that enforcement would be “unfair or unreasonable.” However, the Court recognized that such clauses should not be enforced if enforcement “would be contrary to a strong or fundamental policy of this state.”

The Court did not view the forum-selection provision here as violating any such fundamental California policy. Although California public policy “supports the right to trial by jury where applicable,” and although that right may be waived in civil cases only through prescribed statutory procedures, those provisions governing waiver “concern the right to a jury trial in California courts, not elsewhere.” Accordingly, the Court held that “[t]he California Constitution and related statutory provisions do not reflect any public policy regarding the right to a civil jury trial in other forums.”

Inasmuch as the lower courts had refused to enforce the forum-selection provision solely because it would have effectively denied plaintiff’s right to a jury trial, the Court reversed the ruling and remanded the case. But the Court did not foreclose the possibility that the lower courts could consider the loss of a jury trial in addition to other factors in deciding whether to enforce the forum-selection clause.

Implications
The California Supreme Court’s decision raises several interesting issues that involve California law but also could have spillover effects outside California.

First, the Court raised the possibility that, while the effective loss of a jury trial could not on its own preclude enforcement of a forum-selection clause requiring litigation in a forum where a jury trial would not be available, it could be relevant as part of a broader analysis of enforceability. The Court noted that it “need not and [did] not consider whether California’s strong public policy in favor of the right to a jury trial might be relevant, in combination with other factors, to the enforceability of a forum selection clause in other contexts or under other theories” (emphasis added). Future litigation could explore what those other factors might be.

In the EpicentRx case, for example, plaintiff had contended in the lower court that the forum-selection clause was unfair and unreasonable not only because of its impact on jury-trial rights but also because the company had adopted it “after the misconduct alleged in plaintiff’s complaint came to light.” We will see whether the lower courts, on remand, consider the jury-trial issue as part of plaintiff’s broader allegation that the corporation had not adopted the clause “on a clear day” (to use Delaware language) but rather in response to a specific lawsuit.

Second, to the extent the EpicentRx decision leaves open the possibility of considering loss of a jury trial as part of a broader enforceability analysis, plaintiffs might add jury-trial claims (such as fraud claims) to fiduciary cases if they think that doing so would give them a better chance of claiming a right to a jury trial and attacking a forum-selection clause.

Third, the California Supreme Court’s focus on whether the exclusive-forum provision would result in forfeiture of a statutory or constitutional right is tangentially related to an issue that has created a split in the federal Circuits: what happens if enforcement of an exclusive-forum provision would preclude plaintiffs from asserting their claims in any forum? In 2022, the Seventh Circuit declined to enforce a provision designating the Delaware Court of Chancery as the exclusive forum for shareholder derivative claims because the provision would have prevented the shareholder from bringing the asserted claims at all. The shareholder had pled derivative claims under the Securities Exchange Act, which are subject to exclusive federal jurisdiction and cannot be brought in a state court. Enforcement of the Delaware-forum provision thus would have barred assertion of those claims in any forum. But in 2023, the en banc Ninth Circuit, in a 6-to-5 decision, disagreed with the Seventh Circuit and upheld an exclusive-forum provision designating the Delaware Court of Chancery as the exclusive forum for derivative claims even though the Delaware court could not have entertained the plaintiff’s Exchange Act claims. Perhaps the U.S. Supreme Court will address this issue at some point.