Delaware Court of Chancery Invalidates Forum Selection Clauses Purporting to Apply to Federal Securities Claims, Even in Certificates of Incorporation

On December 19, 2018, the Delaware Court of Chancery decided Sciabacucchi v. Salzberg, C.A. No. 2017-0931-JTL, slip op. (Del. Ch. Dec. 19, 2018), in which it invalidated forum selection clauses in three certificates of incorporation that purported to require any claim under the Securities Act of 1933 to be filed in federal court. Although Delaware law permits forum selection clauses to govern claims related to internal corporate affairs, the court stated that claims arising under the Securities Act of 1933 are external claims. Thus, the court held that forum selection clauses in certificates of incorporation or bylaws cannot govern claims under the Securities Act of 1933. The court’s opinion is available here.