Investment Fund Litigation Updates - March 2026

Enforcement of Forum Selection Clauses Under California Law Following EpicentRx 

In July 2025, the California Supreme Court issued its longanticipated decision in EpicentRx, Inc. v. Superior Court, 18 Cal. 5th 58, 572 P.3d 1 (Cal. 2025), bringing needed clarity in holding that forum selection clauses involving California parties should be enforced even if they contain a waiver of the right to a jury trial. The unanimous decision explained that “a forum selection clause is not unenforceable simply because it requires the parties to litigate in a jurisdiction that does not afford civil litigants the same right to trial by jury as litigants in California courts enjoy.” In the months since, courts in California and elsewhere have applied EpicentRx to enforce previously contested forum selection clauses, changing the landscape for forum selection litigation involving California parties. 

The California Supreme Court reaffirmed in EpicentRx that forum selection clauses are presumptively valid and enforceable, consistent with “the ‘modern trend’ favoring enforceability.” The EpicentRx court clarified that the burden falls on the party opposing enforcement “to show that its enforcement would be in violation of the settled public policy of this state.” This reversed lower appellate court decisions that had placed the burden on the party seeking enforcement to prove that it would not diminish California rights. Importantly, the court distinguished between substantive and procedural rights: it held that California’s strong public policy “protects the jury trial right in California courts, not elsewhere,” and the civil jury trial right is “a procedural right, not a substantive one.” This holding effectively overruled Court of Appeal decisions, including Handoush v. Lease Finance Group, LLC, 41 Cal. App. 5th 729 (2019), that had refused to enforce forum selection clauses based on their impact on jury trial rights. That said, forum selection clauses could still be unenforceable under California law if they violate a “strong or fundamental public policy” of California. The court identified statutory examples where the California Legislature has prohibited such clauses, including in franchise agreements, consumer contracts, and certain employment-related statutes. 

The EpicentRx decision has quickly simplified pending litigation nationwide where the parties engaged in often protracted proceedings regarding enforceability of forum selection clauses, due to a California litigant’s waiver of the right to a jury trial. For example, in November 2025, a California corporation that was sued in the Delaware Court of Chancery two years earlier conceded the argument that a forum selection clause in a merger agreement was unenforceable because the Delaware Court of Chancery does not conduct jury trials. The Court of Chancery explained that the California defendant “conceded this argument after the California Supreme Court’s EpicentRx decision, which held that a forum selection clause is not unenforceable on public policy grounds based solely on the clause’s impact on plaintiff’s jury trial right.” Anzu Partners LLC v. OmegaX, Inc., C.A. No. 2024-0526-PAF (Del. Ch. Nov. 6, 2025). 

California courts are likewise applying EpicentRx to enforce previously contested clauses. In the Comedy Store v. Moss Adams LLP saga, a plaintiff sued an accounting firm for professional negligence in California, even though the parties’ agreement contained a Washington forum selection clause and jury trial waiver. The trial court initially enforced the clause and dismissed the case but, on appeal, the California Court of Appeal reversed, relying on Handoush and other authority holding that forum selection clauses were unenforceable where they would potentially diminish a California resident’s jury trial rights. On reconsideration following EpicentRx, the Court of Appeal affirmed the trial court’s initial decision—putting an end to a four-year fight over the enforcement of an unambiguous forum selection clause. Comedy Store v. Moss Adams LLP, No. B327404, 2025 WL 3717063 (Cal. Ct. App. Dec. 23, 2025). 

EpicentRx has brought substantial clarity to the treatment of forum selection clauses involving California parties. As demonstrated by Anzu and Comedy Store, courts are enforcing such clauses with simple, straightforward analysis, contrary to the often lengthy and protracted litigation proceedings over enforcement in the pre-EpicentRx era. The California Supreme Court made clear that the contract language controls notwithstanding a jury trial waiver, rejecting arguments based on inconvenience, witness location, or unavailability of jury trials. Companies engaging with California parties can now have greater confidence that contractually negotiated forum provisions will be enforced, bringing predictability and certainty to commercial transactions.