Opposition Brief — LAURO LINES s.r.l. v. Chasser

IN THE

Supreme Court of the United States

October Term, 1988

LAURO LINES s.r.1.,

Petitioner,

v.

SOPHIE CHASSER, ANNA SCHNEIDER, ILSA KLINGHOFFER

and LISA KLINGHOFFER, as Co-Executrixes of the Estate of ®

LEON and MARILYN KLINGHOFFER, VIOLA MESKIN, SEY-

MOUR MESKIN, SYLVIA SHERMAN, PAUL WELTMAN,

EVELYN WELTMAN, DONALD E. SAIRE and ANNA G. SAIRE,

CHANDRIS CRUISE LINES, ABC TOURS TRAVEL CLUB,

CHANDRIS (ITALY) INC., PORT OF GENOA, ITALY, CLUB

ABC Tours, INC., and CROWN TRAVEL SERVICE, INC.,

d/b/a RONA TRAVEL and /or CLUB ABC Tours, and CLUB

ABC Tours, INC., Respondents.

On Petition for Writ of Certiorari to the United States Court of

Appeals for the Second Circuit

RESPONDENTS BRIEF IN OPPOSITION

PIsSCHER, & KAGAN.

Wall Street Plaza

88 Pine Street

25th Floor

New York, New York 10005

Counsel for Respondents

Ilsa Klinghoffer

Lisa Klinghoffer

On the Bret

Jay D. Fischer

Jeffrey D. Marks

er an |

‘

TABLE OF CONTENTS

PAGE

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REASONS WHY THE Writ SHOULD BE DENIED... —i*«w” 3

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APPENDIX:

(A) Opinion of the United States Court

of Appeals for the Second Circus

GERSEES AGUS ©, GED ccccsccceseccesssucessnal la

(B) Opumion of the United States District

Court for the Southern District of

New York entered October 23. 1987... isis I3a

ef

TABLE OF AUTHORITIES

Alabama Labor Council v. State of Alabama, 453

Sonn ns ccccccecccccs

Bray v. U.S., 370 F. 2d 44 (Sth Cir. 1966) .......... 7

Bremen v. Zapata Off-Shore Company, 407 U.S. |

Brewen v. U.S., 375 F. 2d 285 (Sth Cir. 1967).......

Central Contracting Co. v. Maryland Casualty Co.,

EE, Ms vc ccccccccccccccecss 5.6

Chasser v. Achille Lauro Lines, 844 F . 2d 50 (2nd Cir.

ee Ceca cecccoccccccccecs 3,10

Coastal Steel Corp. v. Tilghman, 709 F. 2d 190 (3d.

Cir. 1983), cert. denied, 464 U.S. 938 (1983) ...... 4

Cohen v. Beneficial Industrial Loan Corp., 337 U.S.

541 (1949) cert. granted, 336 U.S. 917 (1949)... ... “3.9

Control Data Corp v. International Business Mach.

Corp., 421 F. 2d 323 (8th Cir. 1970).............. x

Davenport v. Adolph, 314 N.W. 2d 432 (lowa 1982),

Ne. ccc cccceccce 6

Dukane Fabrics International, Inc. v. M.V. Hreljin,

600 F. Supp. 202 (S.D.N.Y. 1985) ............... 7

Farmland Industries v. Frazier—Parrot Commodities,

806 F. 2d 848 (8th Cir. 1986) .................... 4

Fennell v. U.S., 339 F. 2d 920 (10th Cir. 1965), cert.

denied, 86S. Ct. 100, 382 U.S. 852, 15 L. Ed. 2d 90. 7

Galaxy Export Corp. v. M/V ‘Hektor’, 1983 A.M.C.

EE 7

In Re Heddendorf, 263 F. 2d 887 (ist Cir. 1959).....

Kraus v. Board of County Road Comm'rs 364 F. 2d

EEE SSIS SEE LIED x

L.F.C. Lessors Inc. v. Pearson, 585 F. Supp. 1362 (D.

ee ee ck ccc cccccccecocces 6

iV

Lairsey v. Advance Abrasives Co., 542 F. 2d 928 (Sth

See Ge ov cdusuiduedekssassstebeneelsaaas

TEED cocesdicccecesensensonsedesesadedeseseun

Louisiana Ice Cream Distributors v. Carvel Corp..,

Se We Ae Gee Ce Gh GED Nee dé kcccscesavccse

McQuillan v. Italia Societa Per Azione Di

Navigazione, 386 F. Supp. 462 (S.D.N.Y. 1974),

aff d 516 F. 2d 896 (2nd Cir. 1975)...............

Patterson, Zochonis (U.K.) Ltd. v. Compania United

Arrows §.A., 493 F. Supp. 626 (S.D.N.Y. 1980)...

Richardson-Merrell Inc. v. Koller, 472 U.S. 424 (1985)

Rohren, Hibler & Replogie, Inc. v. Perkins, 728 F. 2d

860 (7th Cir. 1984) cert. denied, 469 U.S. 890 (1984).

Siegelman v. Cunard White Star, 221 F. 2d 189 (2d

Gh CEE + Sh UES ewescennsennduteniesasnesaen

S. Stern & Co. v. U.S., 331 F. 2d 310 (C.C.P.A. 1963)

CR Es rs Gs es cbbdseccenedadsadauas

Stringfellow v. Concerned Neighbors In Action, 107

Se Gb Gee Gntcccscnadddasdsdekiasacee

ep as ED 565066 0ckcncsesdanetaeusisenn

Death on the High Seas Act, 28 U.S.C. § 761, et segq..

=

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No, 88-23 __

Supreme Court of the United States

October Term, 1988

LAURO LINES s.r.l.,

Petitioner.

Vv.

2 PHIE CHASSER, ANNA SCHNEIDER, ILSA KLINGHOFFER

and LISA KLINGHOFFER, as Co-Executrixes of the Estate of

LEON and MARILYN KLINGHOFFER, VIOLA MESKIN, SEY-

MOUR MESKIN, SYLVIA SHERMAN, PAUL WELTMAN,

EVELYN WELTMAN, DONALD E. SAIRE and ANNA G. SAIRE, |

CHANDRIS CRUISE LINES, ABC TOURS TRAVEL CLUB,

CHANDRIS (ITALY) INC., PORT OF GENOA, ITALY, CLUB

ABC Tours, INC., and CROWN TRAVEL SERVICE, INC.,

d/b/a RONA TRAVEL and /or CLUB ABC Tours, and CLUB

ABC Tours, INC.,

Respondents.

On Petition for Writ of Certiorari to the United States Court of

Appeals for the Second Circuit

RESPONDENTS BRIEF IN OPPOSITION

Respondents Ilsa Klinghoffer and Lisa Klinghoffer respectfully request

that this Court deny the petition for writ of certiorarn, seeking review of the

opinion of the Court of Appeals for the Second Circuit in this case. That

opinion is reported at 844 F.2d 50.

OPINIONS BELOW

The opinion of the United States Court Appeals for the

Second Circuit officially reported at 844 F.2d 50 (2d Cir. 1988)

is printed in the Appendix at la-i2a. the decision of the

United States District Court for the Southern District of New

York dictated in open Court on October 21, 1987, not offi-

cially reported, is printed in the Appendix at 13a-17a.

STATEMENT OF THE CASE

Petitioner Lauro Lines s.r.!. (“Lauro Lines’’) is the suc-

cessor by merger to Achille Lauro de Altri-Gestione m/n

‘Achille Lauro” s.n.c. (*ALA"’) and Societa de Fatto Achille

Lauro ed Altri-Gestione Armatoriali Nava Noleggiate

(“EAL”), partnerships whose offices were located at Via C.

Columbo 45, Naples, Italy. ALA owned the Italian-flag

ACHILLE LAURO. Since February, 1982 both partnerships

were in Italian reorganization proceedings. On July 28, 1986

all members of the Lauro group, including these partnerships,

were merged into one company, i.e., Lauro Lines s.r.|. The

merger was deemed retroactive to February, 1982.

On Septmber 14, 1984 ALA time chartered the ACHILLE

LAURO to a joint venture composed of FAL and Chandris

S.A. (Piraeus). The Joint Venture operated the Vessel as a

cruise ship. Tickets were sold to passengers worldwide.

Chandris S.A. (Piraeus) was reponsible for the United States

market. It retained Chandris, Inc. in New York to promote

bookings and distribute tickets to interested travel agents, and

others.

In October, 1985 the ACHILLE LAURO was hijacked by

terrorists while on a cruise in the Mediterranean. The cruise

commenced at Genoa, Italy, and it was scheduled to termi-

nate at that port. The ticket held by each passenger contained

32 provisions. Among them was the following:

2

Art. 3I—VENUE OF JUDICIAL PROCEEDINGS—

All controversies that may arise directly or indirectly in

connection with or in relation to this passage contract,

must be instituted before the judicial authority in Na-

ples, ee eee ee Samay OG oe

pressly renounced and waived .

Beginning in November, 1985 certain American passengers

(and the representative of a deceased passenger) brought a

series of suits in the United States District Court for the

Southern District of New York against Lauro Lines, Chandris.

and Crown Travel Service, Inc. (“‘Crown’’). Jurisdiction was

based upon diversity of citizenship, 28 U.S.C.A.§ 1332, and.

the actions are also within the District Court's admiralty ju-

risdiction. 28 U.S.C.A. § 1333.*

On November 17, 1986 Lauro Lines filed a motion for an

order dismissing all actions against it on the grounds of lack

of New York in personam jurisdiction, the ticket forum se-

lection clause, and forum non conveniens. Defendants

Chandris and Crown joined the motion to dismiss on the ba-

sis of the forum clause. Plaintiffs in all actions opposed the

motion.

On October 21, 1987 following oral argument. the District

Court denied Lauro Line's motion. With respect to the forum

selection clause, the District Court stated, in part:

I find that the ticket does not give fair warning to the

American citizen passenger that he or she is renouncing

and waiving his or her opportunity to sue in a domestic

forum over a contract made and delivered in the United

States.

App. 6a.

*The Chasser action (85 Civ. 9708) (diversity of citizenship): the

Klinghoffer action (85 Civ. 9303) (diversity of citizenship and the Death

on the High Seas Act, 28 U.S.C. 761 ef seq.); the Saire action (86 Civ.

6332) diversity of citizenship); the Meskin action (86 Civ. 4657) (no ju-

rsdiction allegation in the Complaint).

3

On October 23. 1987 the Order denying enforcement of the

forum clause wa’ entered by the District Court.

On November 20, 1987 Lauro Lines filed its Notice of Ap-

peal from that portion of the Order denying enforcement of

invoked under the collateral final order doctrine of Cohen v.

Beneficial Industrial Loan Corp., 337 U.S. 541 (1949) cert.

granted, 336 U.S. 917 (1949). Chandris and Crown filed sim-

ilar Notices of Appeal. All cases were consolidated for pur-

poses of the appeal.

On January 29, 1988 plaintiffs filed a motion to dismiss the

appeal for want of appellate jurisdiction.

On April 7, 1988 the United States Court of Appeals for the

Second Circuit granted the motion for an order dismissing

the appeal for lack of appellate jurisdiction. The Second Cir-

cuit concluded that:

The order at issue here is not appealable under the col-

lateral order doctrine, Chasser v. Achille Lauro Lines,

844 F.2d 50, 56 (2d Cir. 1988).

REASONS WHY THE WRIT SHOULD BE DENIED

THE INSTANT CASE IS NOT THE PROPER CASE TO

DECIDE THE QUESTION PRESENTED

Petitioner relies on Rule 17: 1(a) of the Supreme Court Rules

stating that one of the character reasons considered by the

Court in determining whether to exercise it discretion to re-

view by writ of certiorari ts:

When a Federal Court of Appeals has rendered a deci-

sion in conflict with the decision of another federal court

of appeal on the same matter... .

The key words are ‘same matter’. In the instant case, the

contract is one of adhesion, not normally reviewable by the

consumer. This matter does in fact differ from the decisions

4

in the other Circuits and as such is not in conflict. The Courts

recognize that the various sophistication levels of the con-

tracting parties and the likelihood to review a forum selection

Four Courts of Appeals, exclusive of the Court below. have

considered the question whether an order denying enforce-

ment of a forum selection clause is appealable as a collater-

ally final order. A common thread running through the facts

of each case has been that the contract examined was of a

type which is ordinarily subject to extensive review .'

The current facts indicate that the plaintiffs were not ade-

quately directed to the terms inside the ticket by defendant.

Whether a notice on the face of a ticket is sufficient to “draw

the passengers attention to the conditions’ within, and

thereby incorporate those conditions into the ticket/contract.

depends upon the particular circumstance of each case and

the ticket involved. It is not uncommon for a Court in the

process of scrutinizing a ticket (in order to determine a defen-

dant carner’s motion to dismiss) to engage in consideration

of such minutia as the shape of the ticket. how it is bound.

the number of pages. the placement of each phrase. the size

of the type utilized, the number of columns of print. the lan-

guages used and the color of paper and ink employed.

McQuillan v. Italia Societa Per Azione Di Navigazione, 386

F. Supp. 462 (S.D. N.Y. 1974), aff'd. 516 F.2d 896 (2d Cir.

1975).

' Coastal Steel Corp. v. Tilghman.. 709 F.2d 190 (3rd Cir, 1989). cert

demed, 44 US. 938 (1983) involving a commercial building contract

Farmiand Industries v. Frazier-Parrot Commodities, #06 F 2d 84% (th

Cur 1986) involving a commercial commodities contract. Lowisiana | «

Cream Distributors v. Carvel Corp., 821 F.2d 1031 (Sth Cir 1987) involv.

ing sales distribution. retail and license agreements. Rohrer Hibler &

Replogie. Inc v Perkins, 728 F.2d 860 (7th Cir, 1984). cert. denied 469

LS 890 (19%4) involving an employment contract

5

The Achille ticket has but one reference on the outside of

the ticket directing passengers to read the terms, including

Art. 31, within. It is far from certain that the Achille Lauro

ticket ‘reasonably communicates the importance’*? of a term

in conditions of passage. a term which would require a pas-

senger to return to Europe to have their day in Court.

Public policy argues against contracts of adhesion which

lay venue outside the United States. In Bremen v. Zapata

Off-Shore Company 407 U.S. 1 (1972) the Court stated that

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.”’ /d. at 10.

The Zapata holding that forum selection clauses are prima

facie valid can be distingushed on the facts in the same man-

ner the four decisions of the other Courts of Appeals can be

distinguished from that of the Court below. Critical to the

Court's holding in Zapata is that:

The choice of (the London) forum was made in an arms-

length negotiation by experienced and sophisticated

businessmen, and absent some compelling and counter-

vailing reason it should be honored by the parties and

enforced by the courts.’ Jd. at 12.

Under the facts of Central Contracting Co. v. Marviand

Casualty Co., 467 F.2d 341, 344 (3d Cir. 1966) cited by the

Zapata Court to define reasonableness, “mere inconvenience

McQuillan. at 466.

' Zapaia wmvolved a contract between an ocean-towing tug service based

in Europe and an American offshore drilling concern The Bremen was

to tow a large. barge mounted. drilling ng from the Gulf of Mexico to the

North Sea In route the ng was damaged and the Bremen put into port at

Flonda The contracts to tow placed venue for any litigation in London

Zapata attempted to litigate in the U.S Evertually the Supreme Court

gave the forum selection clause effect.

6

or additional expenses’’ were found insufficient to constitute

a test of unreasonableness in a forum selection clause. This is

logical in the context of a commercial contract ‘since it may

be assumed that the plaintiff (i.e., the party resisting the fo-

rum provision) received under the contract, consideration”

for any such expense or inconvenience. /d. at 344-45. There

is room to argue that an unsophisticated tourist should not be

held to the same standard of reasonableness. Cf. L.F.C. Les-

sors Inc. v. Pearson, 585 F. Supp. 1362 1364 (D.Mass. 1984).*

The Achille plaintiffs were not dealing with the defendants

at arms length and surely, if confronted directly with the fo-

rum selection clause at Art. 31, would have hesitated to ac-

cept the contract.

The court in Davenport v. Adolph, 314 N.W. 2d 432, (lowa

1982), 31 A.L.R. 4th 395, 403, surveyed the attitude of differ-

ent jurisdiction's choice-of-forum provisions and reported

that such provisions ‘‘are less likely to be sustained if they

appear in adhesion contracts prepared in advance by one of

the parties and will generally be disregarded if genuine incon-

vemience or inadequacy of remedy would ensue from them‘

* In L.F.C. the defendant opposed a forum selection provision. The court

upheld the provision after finding that the defendant was not an “unso-

phisticated consumer but a businessmen

* Cruise tickets are without question adhesion contracts. “‘The ticket is

what has been called a contract of ‘adhesion or a ‘take or leave it’ con-

tract. In such a standardized or mass production agreement with one

sided control of its terms, when the one party has no real bargaiming

power, the usual contract rule, based on the idea of ‘freedom of contract

cannot be applied rationally For such a contract is ‘sold not bought’

The one party dictates its provisions, the other has no more choice in

fixing those terms than he has about the weather “Seigelman v

Cunard White Star, 221 F.2d 189, 204 (2d Cir. 1955)

;

In contrast is New York Southern District's clear position

that ‘Courts in this District have consistently found that it is

not unreasonable to enforce a choice of forum provision em-

bodied within a standard printed form.’’ Dukane Fabrics In-

ternational, Inc.v. M.V. Hreljin, 00 F. Supp. 202, 203

(S.D.N.Y. 1985). The District Court cites two cases in sup-

port of this proposition.® All three cases are commercial in

nature-contracts, which involve sophisticated parties and

which would ordinarily be subject to extensive review. None

involve passenger contracts for a cruise ship.

The question posed by Petitioner is very broad. Whether a

given forum selection clause is appealable must rest on the

facts and circumstances of each case. Should this Court feel

that the Circuits which have decided the issue, none of which

have addressed adhesion contracts and unsophisticated par-

ties thereto, are in conflict, then a case similar to those de-

cided by the conflicting Circuits should be used to finally

decide the issue. This case is not suitable for the question.

THE APPELLATE PROCESS IS PROCEDURAL IN

NATURE THUS ENABLING EACH CIRCUIT TO

ESTABLISH ITS PROCEDURAL PRACTICE.

An appeal from the judgment of a Federal District Court ts

a matter of right.’ However, the Court of Appeals must grant

© Galaxy Export Cor. v. M’V “Hektor”, 1983 A.M_C 2637 (S.D.N.Y 1983),

Patierson. Zochonis (U.K) Lid. v. Compania United Arrows $.A., 493

F. Supp. 626 (S.D.N.Y. 1980)

’ Bray v. U.S. 370 F.2d 44, 46 (Sth Cir, 1966) See. also, Brewen v. U.S.,

375 F.2d 285, 286 (Sth Cir. 1967); Fennell ». U.S., 399 F.2d 920, 922

(10th Cir, 1965), cert. denied % S. Ct. 100, a2 U.S. 852, 1S L.Bd.2d 9

permission for a litigant to appeal to that Court. The granting

of permission may at times occur in an informal fashion but

ordinarily is accomplished by explicit order. If no application

is made to it within the time specified by statute, no appeal

can be taken.” The statutory criteria of 28 U.S.C. § 1292 “In-

terlocutory Decisions’ do not literally apply to the Court of

. In Lairsey v. Advance Abrasives Co., $42 F.2d 928, 929 note 2. (Sth Cir

1976) the plaintiffs sought relief from the judgment under Civil Rule

“4 b) while an appeal was pending After demal of rehef. the plaintiffs

* Failure to file an application with the Court of Appeals within the

'' S.Rep. 2434, 85th Cong.. 2d Sess., 1958, in 1998 U.S. Code Cong. &

Admin. News S255, $257.

es “Although it is not incumbent updn this court to express our reasons for

granting or denying an application for permission to take an interlocu-

tory appeal, we do so in the present case.’ Kraus v. Board of County

Road Comm'rs, ¥64 F.2d 919, 922 (6th Cir. 1966).

Appeals.'* The implication of the appellate process is cer-

tainly that it ts one of procedure.

Although Petitioner bases his appeal on the collateral final

order doctrine of Cohen v. Beneficial Industrial Loan Corp..,

337 U.S. 541 (1949) rather than on the strict interpretation of

28 U.S.C. § 1292, the appellate process as explained remains

the same.

The Court of Appeals for each Circuit may establish its

own appellate procedure. The United States Code provides

in part that:

The Supreme Court and all courts established by Act of

Congress may from time to time prescribe rules for the

conduct of their business. Such rules shall be consistent

with the Acts of Congress and rules of practice and pro-

ry aaa See SA.

$2071.

stantial rights of litigants be not unduly circumscribed. S.

Stern & Co. v. U.S., 331 F. 2d 310, (C.C.P.A. 1963), cert.

denied, 84 §. Ct. 1169.

The question becomes whether the substantial nghts of lit-

igants in the instant case have been unduly circumscribed.

The order below points to | sre being no reason why denial

of a motion to dismiss on the basis of a contractual forum

'* “Although the statute does not expressly lay down standards to guide

the Court of Appeals in its exercise of judicial ‘discretion’. & would

seem that the appellate court should at least concur with the distnct

selection clause should be any less subject to correction upon

appeal from a final judgment then are demals of motions for

dismissal on grounds of improper venue or of forum-non-

conveniens. Chasser, 844 F.2d at 54. The Supreme Court has

made it clear that the mere fact that ultimately it might ap-

pear that an interim reversal would have been more efficient.

or that the party against whom the order 1s entered may have

difficulty in persuading the Appellate Court to reverse after a

final judgment, is not reason to grant immediate review.

Stringfellow v. Concerned Neighbors In Action, 07 S. Ct.

1177 (1987). The Court succinctly stated in Richardson—

Merrell inc. v. Koller, 472 U.S. 424, 4356 (1985):

“The possibility that a ruling may be erroneous and may

umpose additional litigation expense 1s not sufficient to

As ts evident from these decisions, the consequences which

would accompany the demal of enforcement of a forum se-

lection clause are not considered as unduly circumscribing

the nghts of litigants thereby prohibiting the courts from pre-

scrnbing thei individual appellate rules on the matter.

Without restating the cases on which Petitioner relies to

undicate conflict between the Circuits, should this Court in

fact determine that there is such a conflict. this conflict is

permissible pursuant to the rule making power afforded the

various Federal Courts under 28 U.S.C.A. $2071.

CONCLUSION

For these reasons, the Petition for a Writ of Certiorari

should be denied.

Respectfully Submitted

Jay D. Fischer

Fischer & Kagan

Wall Street Plaza

88 Pine Street

25th Floor

New York, New York 10005

Counsel for Respondents

APPENDIX

la

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

August Term, 1987

(Argued: February 16, 1988 Decided: April 7. 1988)

Docket Nos. 87-9081, -9083, -9085, -9087, -9089, -9091

SOPHIE CHASSER, ANNA SCHNEIDER, ILSA KLINGHOFFER

and LISA KLINGHOFFER, as Co-Executrixes of the Estate

of LEON and MARILYN KLINGHOFFER, VIOLA MESKIN,

SEYMOUR MESKIN, SYLVIA SHERMAN, PAUL WELTMAN,

EVELYN WELTMAN, DONALD E. SAIRE and ANNA G.

SAIRE,

Plaintiffs-Appellees,

ACHILLE LAURO LINES, THE LAURO LINES s.r.1., FLOTTO

ACHILLE, CHANDRIS CRUISE LINES, ABC TOURS

TRAVEL CLUB, S.N.C. ACHILLE LAURO ED ALTRI-

GESTIONE MOTONAVE ACHILLE LAURO IN AMMINISTRA-

ZIONE STRAORDINARIA, COMMISSARIO OF THE FLOTA

ACHILLE LAURO IN AMMINISTRAZION® STRAORDINA-

RIA, CHANDRIS (ITALY) INC., PORT OF GENOA, ITALY,

CLUB ABC Tours, INC., and CROWN TRAVEL SERVICE,

INC., d/b/a RONA TRAVEL and /or CLUB ABC TOuRS,

Defendants.

2a

LAURO LINES s.r.1., CHANDRIS CRUISE LINES. CLUB ABC

TOURS, INC., CROWN TRAVEL SERVICE, INC.. d/b/a/

RONA TRAVEL and/or CLUB ABC Tours. and CLUB

ABC Tours, INC..

Defendants-Appellants.

Before:

KEARSE and MAHONEY, Circwit Judges,

and GLASSER, District Judge*

Motion to dismiss appeals from an interlocutory order of

the United States District Court for the Southern District of

New York, Louis L. Stanton, Judge. denying motion of de-

fendant Lauro Lines s.r.|. to dismiss actions on ground that

contract provision required suit to be brought in Italy.

Motion granted.

—

MORRIS J. EISEN, P.C.. New York. New

York (Arthur M. Luxemberg, New

York, New York), for Plaintiffs-

Appellees Sophie Chasser, Anna Sch-

neider, Viola Meskin, Sevmour Meskin.

Sylvia Sherman, Paul Weltman. and

Evelyn Weltman.

WOLF, BLOCK, SCHORR & SOLIS-COHEN.

Philadelphia, Pennsylvania, (Fischer.

Kagan, Ascione & Zaretsky, New York.

New York), for the Klinghoffer

Plaintiffs-Appellees.

WILLIAM P. LARSEN, JR... New York. New

York, (Newman, Schiau, Fitch & Burns.

P.C.. New York, New York), for the

* Judge of the United States District Court for the Eastern District of New

York. sitting by designation

3a

Saire Plaintiffs-Appellees.

RAYMOND A. CONNELL, New York, New

York, (Healy & Baillie, New York, New

York), for Defendant-Appellant Lauro

Lines s.rJ.

KIRLIN, CAMPBELL & KEATING, New

York, New York (Daniel J. Dougherty,

New York, New York), for Defendant-

Appellant Chandris Cruise Lines.

RUBIN, Hay & GOULD, P.C., Framingham,

Massachusetts (Rodney E. Gould, Fra-

mingham, Massachusetts, A. George

Koevary, Parker & Duryee, New York,

New York), for Defendant-Appellant

Crown Travel Service, Inc., d/b/a Rona

Travel and/or Club ABC Tours.

KEARSE, Circuit Judge:

Defendants Lauro Lines s.r.l. (“Lauro”), et ail., appeal

from an interlocutory order of the United States District

Court for the Southern District of New York, Louis L.

Stanton, Judge, denying Lauro’s motion to dismiss the

present actions on the basis of forum-selection clauses in the

ticket agreements between Lauro, owner of the cruise ship

ACHILLE LAURO. and plaintiffs, who were or represent pas-

sengers on the ACHILLE LAURO. The clauses provided that

any suit by passengers against Lauro was to be brought in

Naples, Italy. Plaintiffs have moved to dismiss the appeals

for lack of appellate jurisdiction. For the reasons below, we

grant the motion.

BACKGRO''ND

4a

Mediterranean cruise in October 1985 when it was hijacked

by terrorists of the Palestine Liberation Organization

(‘*PLO”’). The passengers were held captive and terrorized

by the PLO, and they have brought the present actions, in-

formally consolidated below, to recover damages for physical

and psychological injuries and for the wrongful death of Leon

Klinghoffer.

Lauro moved to dismiss the actions on several grounds,

including the ground that a forum-selection clause in each

passenger ticket required plaintiffs to bring these suits in Na-

ples. The district court denied the motion to dismiss. With

respect to the forum-selection clause, the court stated that

the touchstone for enforceability was ‘‘whether the ticket

reasonably communicates the importance of its contract pro-

vision.’’ Transcript dated October 21, 1987 (**Tr.**), at 3. The

court described the “cover reference’’ to the forum clause as

‘“‘unobtrusive’’ and noted that the clause itself appeared in

“tiny type."’ /d. at 4. Further, the court noted that though

the ticket provided that the passenger ** ‘specifically

approves’ ©’ certain clauses, the forum-selection clause was

not among them. /d. at 5. In addition, though there was a

place for the passenger's signature at the bottom of the con-

tract, apparently none of the tickets was signed. In sum, while

the district court termed the question of adequacy of notice a

close one as to which reasonable persons might differ, id. at

4, it concluded that *‘as a whole . . . the ticket does not give

fair warning to the American citizen passenger that he or she

is renouncing and waiving his or her opportunity to sue in a

domestic forum over a contract made and delivered in the

United States,”’ id. at 5. Accordingly, the court denied the

motion to dismiss.

Lauro and two other defendants have appealed the court's

refusal to dismiss on the basis of the forum-selection clause.

Plaintiffs have moved to dismiss the appeals on the ground

that the denial of the motion for dismissal is an interlocutory

order that is not appealable under 28 U.S.C.§ 1291 (1982).

Lauro, which made no effort to have the court’s denial on

Sa

forum-selection grounds certified for immediate appeal pur-

suant to 28 U.S.C. § 1292(b) (1982), argues that that denial is

a final order insofar as it determines where the litigation will

be conducted and that it is immediately appealable under

§ 1291 pursuant to the Cohen doctrine, Cohen v. Beneficial

Industrial Loan Corp., 337 U.S. 541 (1949). We conclude that

the order is not appealable and we therefore dismiss the ap-

peals.

DISCUSSION

Section 1291 gives the courts of appeals jurisdiction to re-

view ‘“‘final decisions’’ of the district courts. 28 U.S.C.

§ 1291. The district court’s denial of a motion to dismiss,

which leaves the controversy pending, is not, technically, a

final decision within the meaning of this section. See, e.g.

Catlin v. United States, 324 U.S. 229, 236 (1945). The Cohen

doctrine, on which Lauro here relies, is a judicially created

exception that allows an immediate appeal from certain or-

ders that are collateral to the merits of the litigation and that

cannot be reviewed adequately after final judgment. As the

Supreme Court has described it,

[t]he collateral order doctrine is a ‘‘narrow excep-

tion,’’ . . . whose reach is limited to trial court orders

affecting rights that will be irretrievably lost in the ab-

sence of an immediate appeal. See Helstoski v. Meanor,

442 U.S. 500, 506-508 (1979); Abney v. United States,

431 U.S. 651, 660-662 (1977). To fall within the excep-

tion, an order must at a minimum satisfy three condi-

tions: It must “conclusively determine the disputed

question,’ ‘resolve an important issue completely sep-

arate from the merits of the action,”’ and “‘be effectively

unreviewable on appeal from a final judgment.”

Richardson-Merrell Inc. v. Koller, 472 U.S. 424, 430-31

(1985) (quoting Coopers & Lybrand v. Livesay, 437 U.S. 463,

468 (1978)).

The narrowness of the collateral order doctrine reflects ju-

dicial deference to Congress's preference against piecemeal

appeals, as well as the recognition that judicial efficiency may

-

6a

be promoted by the denial of interim review because some

interlocutory orders will have become moot by the time a

final judgment is entered, either because the order is modified

prior to final judgment, or because the party disadvantaged

by the interlocutory order prevails in the action, or for some

other reason. See, e.g., Stringfellow v. Concerned Neighbors

In Action, 107 §. Ct. 1177, 1184 (1987) (‘‘Stringfellow’’);

Mitchell v. Forsyth, 472 U.S. 511, 544 (1985) (Brennan, J.,

concurring in part and dissenting in part). The Court has made

it clear that when an interlocutory order will be reviewable

on appeal from a final judgment, the mere fact that ultimately

it might appear that an interim reversal would have been more

efficient, or that the party against whom the order is entered

may have difficulty in persuading the appellate court to re-

verse after a final judgment, is not a reason to grant immedi-

ate review. In Stringfellow, for example, a party that had

been allowed to intervene in an action on condition, inter

alia, that it not assert new claims sought to appeal immedi-

ately from the imposition of conditions on its intervention.

Though it conceded that it would have the right to a review

of the conditions upon appeal from the final judgment, it ar-

gued that the practicalities of complex and protracted litiga-

tion would make an appellate court reluctant to vacate the

judgment on the basis of an erroneous intervention order.

The Court was unpersuaded that this consideration should

lead to disregard of the Cohen requirement of effective

unreviewability on appeal from final judgment. As the Court

succinctly stated in Richardson-Merrell Inc. y. Koller, *‘the

possibility that a ruling may be erroneous and may impose

additional litigation expense is not sufficient to set aside the

finality requirement imposed by Congress."’ 472 U.S. at 436.

This Court too has generally been reluctant to apply the

Cohen doctrine in an expansive fashion, *‘lest this exception

swallow the salutory ‘final judgment’ rule."’ Weight Watchers

v. Weight Watchers Int’l, Inc., 455 F.2d 770, 773 (2d Cir.

1972); see, e.g. Richardson Greenshields Securities, Inc. v.

Lau, 825 F. 2d 647, 651 (2d Cir. 1987): C arlenstolpe v. Merck

& Co., 819 F 2d 33, 35-36 (2d Cir. 1987): United States Tour

———

7a

Operators Ass'n v. Trans World Airlines, 556 F. 2d 126, 128

(2d Cir. 1977). For example, our decisions indicate that this

doctrine does not permit immediate appeals pursuant to

§ 1291 from orders denying motions to dismiss on grounds of

improper venue, see A. Olinick & Sons vy. Dempster Bros.,

Inc., 365 F.2d 439, 442-44 (2d Cir. 1966), or forum non

conveniens, see Carlenstolpe v. Merck & Co., 819 F.2d at

35-36.

We have not previously considered the applicability of the

Cohen doctrine to the denial of a motion to dismiss on the

basis of a contractual forum-selection clause. Some of our

sister circuits have concluded that such a denial is immedi-

ately appealable, see Farmland Industries v. Frazier-Parrott

Commodities, 806 F.2d 848, 850-51 (8th Cir. 1986): Coastal

Steel Corp. v. Tilghman Wheelabrator Ltd., 709 F.2d 190,

193-97 (3d. Cir.) (‘‘Coastal Steel’’), cert. denied, 464 U.S.

938 (1983), while others have concluded that is not. see Lou-

isiana Ice Cream Distributors v. Carvel Corp., 821 F.2d 1031.

1032-34 (Sth Cir. 1987); Rohrer, Hibler & Replogle, Inc. v.

Perkins, 728 F.2d 860, 862 (7th Cir.), cert. denied, 469 U.S.

890 (1984). We are persuaded that the latter view is correct

because we believe the refusal to dismiss on forum-selection

grounds is not ‘effectively unreviewable on appeal from a

final judgment.”’

The Third Circuit in Coastal Steel came to the conclusion

that the district court’s refusal to enforce a contractual

forum-selection clause was unreviewable on appeal from a

final judgment because 28 U.S.C. § 2105 (1982) provides that

*[t]here shall be no reversal in the Supreme Court or a court

of appeals for error in ruling upon matters in abatement which

do not involve jurisdiction." We do not agree that § 2105

makes a refusal to enforce a forum-selection clause unreview-

able after final judgment or, if it did have that effect, that it

would allow such a refusal to be reviewed at an earlier state.

If § 2105 were to be taken literally and did preclude review

of such denials after final judgment, we would be at a loss to

understand how there could properly be interim review any

8a

more than review after final judgment, for ‘‘no reversal’’ has

a rather categorical flavor. Coastal Steel's rationale was that

§ 2105 could not have been intended to preclude interim re-

view pursuant to the collateral order doctrine because that

doctrine had not been devised in 1789 when the first progen-

itor of § 2105 was adopted. See 709 F.2d at 196. We find this

rationale unpersuasive for two reasons. F irst, if Congress has

indeed made a certain type of order immune from review. the

courts simply are not free to ignore the congressional limita-

tion. See, e.g., Thermtron Products, Inc. y. Hermansdorfer,

423 U.S. 336, 343 (1976) (order remanding removed action to

State court on grounds provided in 28 U.S.C. § 1447(c)( 1982)

is made unreviewable by id. § 1447(d), and thus may not be

reviewed). Second, the Cohen doctrine. which interprets fi-

nality within the meaning of § 1291, is concerned with the

timing of review; it assumes reviewability in principle and

focuses on the practical difficulties entailed by postponement

of review. The doctrine has not. to our knowledge, been used

to review at any time an order of a type that Congress has

made unreviewable in principle.

Further, assuming that § 2105 applies to forum-selection

motions, if the section were taken literally, it would forbid

review of even the granting of a motion to dismiss on forum-

selection-clause grounds, for that section does not forbid re-

versals just of denials of motions in abatement; it forbids

reversals of any nonjurisdictional ““ruling’’ upon a matter in

abatement. We have seen no authority supporting the propo-

sition that such a dismissal, which would, of course, be a

final decision in the litigation, is unreviewable.

It appears to us, however, that § 2105 is not to be taken

literally. Commentators have called it ‘‘one of the most com-

monly ignored provisions of the Judicial Code,”’ noting that

its *‘most important feature . . . is certainly its disuse."’ 15 C.

Wright, A. Miller & E. Cooper, Federal Practice and Proce-

dure § 3903, at 412, 413 (1976). This seems an accurate ob-

servation, for assuming, as did Coastal Steel, 709 F.2d at

196, that ‘matters in abatement’’ means any (nonjurisdic-

9a

tional) ground for dismissal that would leave the parties free

to pursue the suit in another forum, that category would ap-

pear to encompass matters such as motions to dismiss on

grounds of improper venue or forum non conveniens; yet both

grants and denials of those motions are commonly thought to

be reviewable on appeal from final judgment. See, e.g., Piper

Aircraft Co. v. Reyno, 454 U.S. 235, 241 (1981) (review of

grant of forum non conveniens motion); Gulf Oil Corp. v.

Gilbert, 330 U.S. 501, 508 (1947) (same); In re Air Crash Di-

saster, 821 F.2d 1147, 1166-68 (Sth Cir. 1987) (en banc) (re-

viewing denial of motion to dismiss for forum non

conveniens), petition for cert. filed (U.S. Nov. 6, 1987) (No.

87-750); Carlenstolpe v. Merck & Co., 819 F.2d at 35-36:

Denver & Rio Grande Western Railroad Co. v. Brotherhood

of Railroad Trainmen, 387 U.S. 556 (1967) (review of denial

of motion to dismiss for improper venue); Gill v. United

States, 184 F.2d 49, 50-51 (2d Cir. 1950) (same); Corke v.

Sameiet M.S. Song of Norway, 572 F.2d 77 (2d Cir. 1978)

(reviewing denial of motion to transfer venue); Central Val-

ley Typographical Union, No. 46 v. McClatchy Newspapers,

762 F.2d 741, 744-46 (9th Cir. 1985) (reviewing both grant by

first district court of a motion to transfer venue and denial by

transferee district court of a motion to transfer to a third dis-

trict).

We see no reason why denial of a motion to dismiss on the

basis of a contractual forum-selection clause should be any

less subject to correction upon appeal from a final judgment

than are denials of motions for dismissal on grounds of im-

proper venue or of forum non conveniens. The Supreme

Court has held that a forum-selection clause in a commercial

agreement “‘should control absent a strong showing that it

should be set aside.’’ The Bremen v. Zapata Off-Shore Co.,

407 U.S. 1, 15 (1972); see Scherk v. Alberto-Culver Co., 417

U.S. 506, 519 (1974). Such a clause thus grants an important

right that should be recognized unless the party resisting en-

forcement shows the clause to be unreasonable. We would

think, therefore, that if the district court has erroneously

10a

failed to enforce such a clause. its order may be reversed

when the judgment is finally appealed.

Perhaps the most pertinent case decided by our Court is

Avis Rent A Car System, Inc. vy. Garage Employees Union.

Local 272, 791 F.2d 22 (2d Cir. 1986), an appeal from a final

judgment enforcing an arbitration award. The ground of the

appeal was that the district court had refused to enforce a

contract provision that required arbitrators to be selected ina

certain way from among a certain group. Noting that ‘‘anal-

ogous contractual forum section clauses are ordinarily bind-

ing and enforceable unless the party resisting them. . . shows

them to be unreasonable,”’ id. at 26, and ruling that no show-

ing of prejudice was required by the party seeking enforce-

ment of the clause, we reversed the judgment enforcing the

award entered by the ‘“‘wrong”’ arbitrator. and we remanded

for entry of an order directing the parties to place their dis-

pute before an arbitrator called for by the contract. Plainly,

therefore, in the context of arbitration clauses, which are a

type of forum-selection clause, this Court has viewed the re-

fusal to enforce as a matter that is fully reviewable on appeal

from the final judgment.

We reject Lauro’s suggestion that the right granted in a

forum-selection clause, if enforceable, must be vindicated

immediately or it is lost. It is a right to have the binding

adjudication of claims occur in a certain forum; it is not a

nght of the same magnitude as a constitutional right to be

free from double jeopardy, see Abney v. United States, 431

U.S. at 660-62, or the right to be free of any trial whatever,

see Mitchell v. Forsyth, 472 U.S. at 530 (qualified govern-

mental immunity); Helstoski v. Meanor, 442 U.S. at 506-08

(Speech and Debate immunity). The rights to escape any trial

or any further trial are rights that would be lost unless vindi-

cated at a pretrial state. In contrast. the right to secure adju-

dication in a particular forum is not lost simply becuse

enforcement is postponed. And, as noted above, the fact that

postponing review may entail additional litigation expense has

lla

been explicitly rejected by the Supreme Court as a basis for

immediate appeal. 5

Since we conclude that the district court's denial of Lauro’s

motion to dismiss on the basis of the forum-selection clause

in the passenger tickets will be effectively reviewable on ap-

peal from final judgment, we need not decide whether the

first two Cohen requirements are met. We conclude that the

order at issue here is not appealable under the collateral or-

der doctrine.

Our recent decision in Karl Koch Erecting Co. v. New York

Convention Center Development Corp., Nos. 87-7306, et al..

slip op. 1431, 1434-36 (2d Cir. Feb. 3, 1988), does not suggest

a contrary result. In Karl Koch, we held, relying on Pelleport

Industries v. Budco Quality Theatres, 741 F.2d 273, 278 (9th

Cir. 1984), that a district court's enforcement of a contractual

forum-selection clause, by remanding a removed action to

State court, was appealable under the Cohen doctrine. Unlike

a refusal to enforce, with which we are presented here, the

Karl Koch enforcement finally decided the forum-selection

issue in a way that made the decision unreviewable on appeal

from the final judgment simply because the litigation was no

longer proceeding in federal court.

Finally, we reject Lauro’s fall-back suggestion that we have

jurisdiction of these appeals under 28 U.S.C. § 1292(a)(1)

(1982). That section allows appeals of interlocutory orders

that grant or deny (or otherwise deal with) injunctions. We

do not regard the denial of a motion to dismiss on forum-

selection grounds as the equivalent of the denial of a motion

for an injunction within the meaning of § 1292(a)(1). Further.

even if such a denial were tantamount to the denial of injunc-

tive relief, we would grant the present motion to dismiss, for

the Supreme Court ‘has made it clear that not all denials of

injunctive relief are immediately appealable; a partly seeking

review also must show that the order will have a ‘* ‘serious, —

perhaps irreparable, consequence,’’ and that the order can be

“effectually challenged’’ only by immediate appeal.’

Stringfellow, 107 S. Ct. at 1184 (quoting Carson v. American

12a

Brands, Inc., 450 U.S. 79, 84 (1981) (quoting Baltimore Con-

tractors, Inc. v. Bodinger, 348 U.S. 176, 181 (1955))) (em-

phasis ours). See also Gulfstream Aerospace Corp. v.

Mayacamas Corp., 56 U.S.L.W. 4243 (U.S. Mar. 22, 1988).

Since, for the reasons discussed above, we have concluded

that meaningful appellate review of the present order will be

available after final judgment, assuming that judgment is ad-

verse to Lauro, § 1292(a)(1) provides no basis for immediate

appeal of the present order.

CONCLUSION

We have considered all of Lauro’s arguments in support of

immediate appealability and have found them to be without

merit. The appeals are dismissed.

l3a

APPENDIX B

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

85 Civ. 9303

October 21, 1987

12:55 p.m.

LEON KLINGHOFFER, ET AL..

Plaintiffs,

v.

ACHILLE LAURO, ET AL..,

Defendants.

Before:

HON. LOUIS L. STANTON,

District Judge

DECISION

Appearances

JAY D. FISCHER,

MORRIS EISEN,

Attorneys for Plaintiffs

LAWRENCE W. SCHILLING,

RAYMOND A. CONNELL,

DANIEL J. DOUGHERTY,

RODNEY GOULD,

Attorneys for Defendants

l4a

[2] (In open court)

THE COURT: Thank you, gentlemen. And thank you all for

excellent briefs on the points involved in this motion.

They have been expressed in writing and orally with clarity

and vigor and style, and admirably cover the great variety of

aspects involved.

In ruling on the motion in a somewhat laconic fashion, I do

not wish to be taken as disregarding any of the areas pre-

sented in the papers or orally, but do so because I feel no

jurisprudential purpose would be served by expanding my

explanation beyond the points which I regard as decisive.

As to jurisdiction over Lauro, this question arises under

New York*‘s Long Arm Statute, which requires a showing of

a continuous and systematic course of doing business here

such as to warrant a finding of Defendant Lauro’s presence in

this jurisdiction.

Mere solicitation of business through an agent is not

enough, although if solicitation is present, in any substantial

degree, very little more is necessary to the conclusion that

business is being done.

The argument presented on this motion, since it is common

ground that solicitation of business was being done, lies in

the fact that Lauro’s agent for-sales [3] and marketing here

was Chandris, Inc., which had authority to confirm some

cabins on the Achille Lauro, and which had been at least

instrumental in part in obtaining for Crown Travel its author-

ity to confirm other space.

In addition, Chandris, Inc., has been responsible for effect-

ing changes in the Achille Lauro’s itinerary, and in some de-

gree to the accommodations of the vessel itself. Chandris,

Inc., issued tickets for confirmed space, for money which

was received and deposited in an account it maintained for

Lauro’s name, and Chandris, Inc., also handled at least on

various occasions the adjustment of passenger complaints.

lSa

There are other activities alluded to, including the volume

of passengers which was booked and the amount of money

involved, but taken as a whole, those of Chandris, Inc.'s,

activities are in themselves sufficient to bring Lauro within

the jurisdiction of this court, and that ground of the motion is

rejected.

I turn now to the ticket condition, as it has been referred

to, which is directed to Clause 31, and which raises a ques-

tion over which the courts have enjoyed 90 years of litigation

since The Majestic.

Under the cases, the touchstone is whether the ticket rea-

sonably communicates the importance of its contract provi-

sion.

[4] In this case, that is a close question. It is one upon

which reasonabie jurists, lawyers, and laymen might differ.

On the one hand, arguing for giving effect to Clause 31,

there are the facts that the reference on the cover is clear and

noticeable, and preceded by the word in solid capital letters,

‘*IMPORTANT.””

The sheet containing what is stated to be the terms and

conditions of contract of passage falls out of the ticket in a

manner that attracts the passenger's attention to it, and, fur-

thermore, as mentioned in at least one of the cases, there is

the sensible understanding, that the passenger must be taken

to understand, that these intricate provisions in Italian and

English were not printed simply for the fun of it, but had

legal meaning which affected the contract of passage.

On the other hand, the cover reference is unobtrusive

rather than eye-catching. It merely draws attention to the ship

owner's terms and conditions, and does not explicitly state

that the ticket represents a contract affecting the passenger's

substantial rights.

If its tiny type is read, Clause 31 carries an importance

beyond the importance of clauses dealing with short statutes

of limitation.

16a

While a statute of limitations clause can be [5] examined

after the accident when the importance of the contract as a

whole is apparent to all, the effect of Clause 31 is immedi-

ately and irrevocably to divest the passenger's right to sue

anywhere except before the judicial authority in Naples.

Yet, the contract is at least indirectly ambiguous on that

point. For unlike the time limitation Clause 27, Clause 31 is

not included in the list of clauses of which the passenger

‘specifically approves.”’ ,

Finally, there is a place for the passenger’s signature at the

bottom of the contract, a provision which as far as appears

has been entirely disregarded by both parties to the contract.

On the question, then, as a whole, I find that the ticket

does not give fair warning to the American citizen passenger

that he or she is renouncing and waiving his or her opportu-

nity to sue in a domestic forum over a contract made and

delivered in the United States.

That brings me to the final ground for the motion, the fo-

rum non conveniens argument, which is raised in a case in

which there are in this forum Chandris, Inc., every plaintiff,

of whom all are United States citizens, and Crown Travel,

and all the initial parties to the suit. The contract was made

here and delivered here.

As against that arguing for transfer there are [6] three seri-

ous considerations offered. The first is the location of Lauro’s

crew witnesses. These matters always involve balancing. On

balancing their travel here it would not appear to me to im-

pose such a burden as to upset the plaintiff's choice of forum.

The other body of witnesses located in Italy, who have

been referred to as the terrorists, do not appear to me to be

sO important to the issues in this case as to justify its transfer

to Naples.

Finally, there is the question of the application of Italian

law, and as to the ultimate application of Italian law in this

action, I make no ruling at this time.

17a

What issues Italian law might govern is a point as yet some-

what unclear, nor does there appear at this point any partic-

ular difficulty in ascertaining or applying Italian law to the

extent it may properly be required, and, therefore, I do not

find that that factor either separately or in concert with the

others justifies transfer under forum non conveniens.

Accordingly, the motion is denied, and will be so endorsed

for the reasons stated. Thank you very much.