NOELLE LEE V. ROBERT FISHER

Plaintiff brought a shareholder derivative action alleging that The Gap, Inc. and its directors (collectively, Gap) failed to create meaningful diversity within company leadership roles, and that Gap made false statements to shareholders in its proxy statements about the level of diversity it had achieved. Gap’s bylaws contain a forum-selection clause that requires “any derivative action or proceeding brought on behalf of the Corporation” to be adjudicated in the Delaware Court of Chancery. Notwithstanding the forum-selection clause, Plaintiff brought her derivative lawsuit in a federal district court in California, alleging a violation of Section 14(a) of the Securities Exchange Act of 1934, 15 U.S.C. Section 78n(a), along with various state law claims. The district court dismissed Plaintiff’s complaint based on its application of the doctrine of forum non conveniens, holding that she was bound by the forum selection clause. The Ninth Circuit affirmed the district court’s dismissal and held that Plaintiff did not meet her burden to show that enforcing Gap’s forum-selection clause contravenes federal public policy, rejecting as unavailing the evidence Plaintiff identified as supporting her position: the Securities Exchange Act’s anti-waiver provision and exclusive federal jurisdiction provision, Delaware state case law, and a federal court’s obligation to hear cases within its jurisdiction. The court, therefore, concluded that the district court did not abuse its discretion in dismissing the complaint. View "NOELLE LEE V. ROBERT FISHER" on Justia Law