First Circuit: Choice of Law Clause Requiring Agreement to Be Construed and Governed According to NY Law Does Not Bar Action Under Massachusetts

First Circuit: Choice of Law Clause Requiring Agreement to Be Construed and Governed According to NY Law Does Not Bar Action Under Massachusetts

Deceptive Business Practices Law In Kleiner v. Cengage Learning Holdings II, Inc., et al., the parties executed an agreement with a choice of law clause which reads as follows: “This Agreement shall be construed and governed according to

the laws of the State of New York.” The First Circuit concluded that such “narrow” clause does not bar an action under Massachusetts General Laws Chapter 93A, which prohibits unfair or deceptive acts or practices in trade or commerce.

The court of appeals reasoned that the clause as issue does “not select any state’s law as governing the parties’ rights and obligations that are created by statute.” Additionally, the court noted that clause does not require that all disputes be resolved according to NY law.