Federal Jurisdiction

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7^th Circuit Court of Appeals

Case Name: Michael B. Johns et al, v. Pushpin Holdings, LLC, et al

Case No.: 15-2771

Officials: WOOD, Chief Judge, and POSNER and ROVNER, Circuit Judges.

Focus: Federal Jurisdiction

Plaintiffs have multiple claims all without merit, as such case properly dismissed with prejudice.

“The plaintiffs have still other claims, such as abuse of process and malicious prosecution. Those claims have no merit either, for reasons well explained by Judge Kocoras and unnecessary for us to repeat. So the plaintiffs must lose. But we want to remark in closing two features of the case that we find troubling, though there is nothing we can do about them. The first is the enforceability of forum‐selection clauses against unsophisticated signers of the clauses, which may describe many of the sole proprietors and other small businesses that leased cred‐ it‐card processing machines from CIT. In Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585 (1991)—a much‐criticized decision (see, e.g., Linda S. Mullenix, “Carnival Cruise Lines, Inc. v. Shute: The Titanic of Worst Decisions,” 12 Nevada Law Journal 549 (2012)), the Supreme Court upheld a forum‐ selection clause printed on the “contract” pages attached to a cruise ticket. The clause had not been negotiated but simply imposed by the cruise line on the passengers, who were un‐ likely to appreciate its significance—the prospect of bringing a lawsuit against the line was not something many passengers would have been thinking about when they bought their tickets. The same may be true in this case with regard to the individuals and small businesses that leased the cred‐ it‐card processing machines. But in light of Carnival, and considering that most lessees of credit‐card processing ma‐ chines lease them for use in business, a defense of unconscionability to the enforcement of the leases and the guaranties would be unlikely to succeed. And even if it were possible within the compass of existing law to invalidate the clauses in a case such as this, the class has challenged the forum‐selection clauses only on the ground that they are an inconvenience to nonresidents of Cook County, Illinois, the selected forum. Any forum‐selection clause will be an inconvenience to a nonresident signer of the contract containing the clause, so that the challenge by the class amounts to urging a blanket prohibition of such clauses, which goes too far.”

Affirmed

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.