DealLawyers.com Blog

Last year, Broc blogged about California joining the list of states that will enforce Delaware forum selection bylaws.  This Troutman Sanders memo says that we can add Missouri to the list:

In a recent decision, a Missouri state court enforced the forum selection bylaws adopted by the board of directors of Monsanto Company requiring that fiduciary duty litigation against the company or its directors be brought in a Delaware court. The bylaws were adopted by Monsanto in anticipation of its approval of a $66 million merger with Bayer AG. The plaintiff sued Monsanto and its board of directors, amongst others, alleging that Monsanto and its board of directors breached their fiduciary duties to the Monsanto stockholders in the negotiations of the merger with Bayer AG.

Plaintiff argued that the forum selection bylaws infringed upon his constitutional rights since the Delaware Court of Chancery does not provide for a jury trial; however, the court rejected plaintiff’s argument and upheld Monsanto’s forum selection bylaw as valid and enforceable, requiring that a suit regarding the fiduciary duties of Monsanto or its board must be filed in the appropriate Delaware court.

Missouri can now be added to the growing list of courts, which also includes New York, Texas, California, Illinois, Ohio and several others, that have ruled in favor of upholding forum selection bylaws adopted by a company’s board of directors.

– John Jenkins