For the first time in its 40-year history, TCJL has filed a brief in the courts of the Commonwealth of Pennsylvania. Ironically, the case, Cardinal Midstream II, LLC v. Energy Transfer LP, et al. (No. 1000 WDA 2025) pits two Dallas-based energy companies against each other in a contract dispute. The relevant contract contained a standard forum-selection clause designating state or federal courts in Dallas County and providing that those courts had irrevocable and exclusive jurisdiction over disputes arising from the contract. The contract also included a choice-of-law provision specifying the application of Texas law.
As you know, both the United States and Texas Supreme Courts have repeatedly held that forum-selection provisions in contracts entered into by sophisticated parties must be enforced in all but the most unusual circumstances. Here it appears that the Pennsylvania trial court looked to a New York federal court’s interpretation of Texas law to support its order denying the Defendants’ motion to transfer the case to Dallas. At the subsequent trial, a Pennsylvania jury awarded and the trial court entered judgment for more than $50 million. Defendants appealed to the Superior Court, Pennsylvania’s intermediate court of appeals.
TCJL’s briefs makes two arguments. First, parties that give good and valuable consideration for forum-selection clauses in their deals with one another should expect reasonably expect courts to honor those agreements, wherever they may be located (and in fact, virtually all states do). Forum-selection clauses have become integral to conducting interstate commerce and should be respected everywhere an entity does business. Second, states whose courts refuse to enforce such clauses invite retaliation by states whose residents are prejudiced by that refusal. This will undermine interstate commerce and represents a significant breach of comity between the states.
We will keep you posted on the progress of this case. You may read a copy of our brief below.
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