Choose Your Poison

Quite often, your vendors’ contracts will include a choice of law provision and a forum selection clause. For example: This Agreement is governed by and construed in accordance with the laws of the State of California, without giving effect to its principles of conflicts of law. Any litigation arising out of this Agreement shall be brought in the courts of Ventura County, California. Each Party hereby expressly and irrevocably waives the right to a jury trial. The prevailing party shall be awarded its reasonable attorneys’ fees and costs in any proceeding arising out of or related to this Agreement.

So what is wrong with this?

It implies that this vendor gets sued by its customers often enough that they feel they have to guarantee home field advantage for themselves. It also implies that, when their customers do eventually sue them, that they think their customers are wrong in suing, and that they need to try to push all of the costs of the lawsuit onto their customer.

At the beginning of the relationship with a new vendor, be mindful of the forum selection and cost shifting red flags. If your new vendor thinks they need to gird for the lawsuit that you’ll eventually be filing against them, then maybe you need a different vendor from the get-go. Don’t ask me to choose how I will die, because frankly I’d rather not die at all.