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Interplay of Forum-Selection Clauses and First-Filed Rule

In Mitek Systems, Inc. v. U.S. Services Automobile Association, a Delaware federal court has held that a forum-selection clause in a licensing agreement does not prevent a court in a non-selected forum from resolving disputes concerning that agreement. The forum-selection clause at issue stated that a court of competent jurisdiction sitting in Delaware would resolve such disputes. However, when a dispute between the licensor and licensee arose, the latter filed suit in a Texas court. The licensor responded by filing an action in Delaware. Applying the “first-filed rule,” the Delaware court granted the licensee’s motion to transfer the Delaware action to Texas for consolidation with the Texas lawsuit. Under that common law rule, the “first-filed” of multiple lawsuits concerning a common subject matter is given preference. The court reasoned that enforcement of the Delaware forum selection clause would violate important public policies, relating to judicial efficiency and comity, that are the basis for that rule.