Facebook Forum Selection Clause Upheld

The Southern District of New York issued a memorandum opinion and order between plaintiffs We Are The People, Inc. and Jacob Milton, and defendants Facebook, Inc., Mark Zuckerberg, and Sheryl Sandberg in relation to plaintiffs’ claims that “Facebook’s alleged removal of content from Plaintiff’s Facebook pages violated Defendants’ contractual and quasi-contractual obligations to keep Plaintiffs’ content posted indefinitely.” The defendants moved to dismiss these claims, stating they are “barred by the Communication Decency Act (CDA),” or alternatively transfer the venue to the Northern District of California “on the basis of a forum selection clause in Facebook’s Terms of Use.” The court granted the motion to transfer and denied the motion to dismiss without prejudice to renewal following the transfer.

The court said “forum selection clauses ‘are prima facie valid and should be enforced unless enforcement is shown by the resisting party to be ‘unreasonable’ under the circumstances.’” This determination relies on a four-prong test. Facebook must demonstrate that the clause was “reasonably communicated” to the other party, the clause was mandatory, and the clause applies to the other party. “If these requirements are met, the burden shifts to the nonmoving party to rebut the presumption of enforceability by making a sufficiently strong showing that enforcement would be unreasonable or unjust, or that the clause was invalid for such reasons as fraud or overreaching.”

Accordingly, the court found transfer to be warranted. In its Terms of Use, Facebook requires that “You [the user] will resolve any claim, cause of action or dispute (claim) you have with us arising out of or relating to this Statement exclusively in the U.S. District Court for the Northern District of California or a state court located in San Mateo County.” Further, the defendants stated that “[e]very person who registers for, uses, and continues to use a Facebook account must agree to Facebook’s terms of use a condition of using Facebook’s services.” The plaintiffs did not disagree with this statement, and even add that they were complying with “all standards, rules, and regulations of the Defendants.” The court said this is enough to declare that plaintiffs agreed to these Terms of Use. Since Facebook’s Terms of Use statement requires that any suit occurs in a specific jurisdiction, it is fair that this suit should be moved to the Northern District of California.

The court added that it is plaintiffs’ burden to “‘rebut the presumption’ that the forum selection clause is enforceable.” However, the plaintiffs “do not even attempt to make such a showing[, nor] could they, for the reasons set forth in Defendants’ memorandum of law.” Thus, the court states that the plaintiffs’ agreement with defendants will be held and the case will be transferred to their agreed venue.

Plaintiffs are represented by John DeMaio. Defendants are represented by Pincus Law LLC.