After allegedly violating the exclusivity provision by selling its products directly to end-users in Latin America, the distributor filed a complaint. When the manufacturer used the “limited remedies” provisions as a defence, the Tribunal found that the provisions were contrary to version 2-719 of the Wisconsin UCC. This section states that the “Seventh Circuit” has decided that under Wisconsin law, if a “limited remedies” provision of the uninjured party had withdrawn all of its appeals against the aggrieved party, the clause is in itself unacceptable and unenforceable. [Sanchelima International, Inc., vs. Walker Stainless Equipment Co., LLC, 2019 Westlaw 1552681 (7th Cir.).] Merger agreements between Delaware companies generally contain trust provisions to meet directors` trust requirements to ensure appropriate shareholder value under the Revlon rule. The fiduciary plan is usually accompanied by a non-shop contract (or non-invitation) and a termination fee (or a demerger tax) when the contract is terminated on the basis of a general proposal. The termination tax is generally considered an exclusive remedy when the contract is terminated. A recent ruling by the Bundesgerichtshof strengthens the position of companies that enter into a forum selection clause in favour of the German courts. If the German courts are chosen as an exclusive forum, legal action in a US court could result in an action for damages against the party in violation of the forum selection clause. Whether a forum selection clause has a substantive obligation to file a complaint only on the chosen forum, which results in an offence creating a secondary obligation to repair the damage is a matter of interpretation.
Even if the contract does not explicitly provide, as in this case, the contract provides for a duty of damages, the purpose of the forum selection clause in the context of the choice of law may argue in favour of such an obligation. A forum selection clause and the choice of legislation are intended to make litigation more predictable. It does not matter that the forum selection clause refers to the “exclusive” jurisdiction. Facts: A manufacturer of stainless steel farming techniques has entered into an exclusive distribution contract with a Latin American company. The agreement contained provisions relating to “limited corrective measures” whererquying (1) the producer would not be held liable to the distributor beyond the purchase price paid by the distributor and (2) that the distributor waived the right to obtain consequential damages, including loss of earnings.