When Forum Selection Clauses Bind Non-Signatories

When a company signs a contract containing a forum selection clause, it is clearly bound by that provision.  But what about its parent company?  Its subsidiaries?  Its affiliates?  Are these non-parties likewise bound by the forum selection clause?

The answer to this question, as it turns out, is surprisingly complex.  On the one hand, it is a well-established principle of contract law that a party may not be bound by an agreement without its consent.  On the other hand, the courts have over the years recognized a number of doctrines – including the law of third-party beneficiaries, equitable estoppel, agency, … Read more