Forum Selection Clauses in Noncompete Agreements
Given the public policy arguments that courts so frequently use when analyzing noncompetes, as well as the perceived unequal bargaining power between employers and employees, it might be surprising to note that some courts are willing to enforce forum selection clauses that choose a forum other than where the employee lives and works. For instance, in Georgia, a state which certainly has its own unique noncompete law (at least until this November's elections), it has been held that a forum selection clause in a noncompete case is enforceable even if such clause would be inconvenient to the employee. Iero v. Mohawk Finishing Products, Inc., 534 SE 2d 136 (Ga. Ct. App. 2000). But see Dentsply Intern., Inc. v. Benton, 965 F. Supp. 574 (M.D.Pa. 1997). But c.f., Hulcher Services v. RJ Corman R. Co., 543 SE 2d 461 (Ga. Ct. App. 2000).
A typical forum selection clause is as follows:
Employee agrees that any claim or action relating to or otherwise arising out of this Agreement shall be subject to the exclusive jurisdiction of the state courts of the [State/Commonwealth/District] of ________ or the federal district court for the ______ District of ________ and Employee hereby submits to the exclusive jurisdiction of those courts.
As with most noncompete issues, the law in this area can vary state by state. Accordingly, it is important to never simply use a form. You should always check applicable law in your state first.