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Permissible Passage

The 1991 Supreme Court case Carnival v. Shute could halt lawsuits against Carnival Corp. and its Italian business unit in relation to the Costa Concordia disaster.

In 1988, Eulala Shute and her husband took a Carnival cruise from Los Angeles to Mexico. While the boat was in international waters, Shute slipped and fell onboard. When Shute returned from her trip, she sued Carnival in her home state of Washington, claiming the cruise line’s negligence caused her injuries.

Carnival moved for summary judgment, contending that a forum-selection clause in Shute’s cruise ticket required her to sue in Florida. The district court granted Carnival’s motion. But the 9th Circuit reversed, claiming Carnival had a direct tie to Washington because it solicited business there.

On appeal, the Supreme Court ruled 7-2 that “including a reasonable forum clause in a form contract of this kind well may be permissible for several reasons,” one of which being the fact that such clauses dispel “any confusion about where suits arising from the contract must be brought and defended, sparing litigants the time and expense of pretrial motions to determine the correct forum.”

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