Saudi Arabian courts are inadequate for resolving employee's claim against Boeing, because those courts discriminate against non-Muslims

|The Volokh Conspiracy |

So held a federal district judge last week in Petersen v. Boeing Co.. Here's the background, from an earlier opinion in the litigation:

Plaintiff Robin P. Petersen, who appears pro se and in forma pauperis on appeal, is a former Navy pilot with the rank of Commander who was recruited to work in Saudi Arabia as a flight instructor for Boeing International Support Services …, a wholly-owned subsidiary of The Boeing Corporation …. [T]he following account describes the facts as alleged in the Complaint.

Prior to departing for Saudi Arabia, Petersen was required to sign a preliminary employment agreement. That agreement did not contain a forum selection clause. On arrival in Saudi Arabia, however, he was forced to sign a second employment agreement—which he was not given time to read and which he was told he must sign or else return immediately to the United States at his own expense. This agreement contained a forum selection clause requiring any contractual disputes to be resolved in the Labor Courts of Saudi Arabia. Petersen signed the second agreement without reading it, as he was instructed to do by his employer.

Petersen's passport was then confiscated; he was effectively imprisoned in his housing compound under miserable living conditions; and his work environment was marked by rampant safety and ethics violations. When he attempted to resign and return to the United States, his employer refused to return his passport for a period of nearly three months. During his time in Saudi Arabia, Petersen contracted an upper respiratory infection as a result of his living conditions and was permanently maimed as a result of receiving inadequate surgical treatment for an Achilles tendon tear, which he would have had treated in the United States had he been permitted to leave Saudi Arabia.

When he finally returned to the United States (after the intervention of the United States Consulate in Jeddah), Petersen brought suit against Boeing and BISS alleging breach of contract as well as several statutory and common law claims

Boeing sought to have the case dismissed because of the forum selection clause—the provision in the employment agreement that disputes be resolved in Saudi Arabia Labor Courts—and such forum selection clauses are indeed routinely enforced. But in this case, the federal district court held last week, the clause should be ignored. Such forum selection clauses, the court noted, are not enforceable where the selected forum isn't "adequate," and this exception to enforceability applies here (paragraph breaks added):

The Saudi Labor Courts are not an adequate forum for Plaintiff's claims. Both experts testified that the Saudi Labor Courts (and other Saudi courts) employ discriminatory evidentiary rules. A Saudi court will only credit testimony if corroborated by two male, Muslim witnesses. This discrimination has direct bearing on Plaintiff's case since his claims are largely based on events not memorialized in writing or otherwise recorded. As a result, the case turns on a combination of testimony and circumstantial evidence.

Furthermore, it is undisputed Plaintiff lacks male [Muslim] witnesses to support his claims. Perhaps Plaintiff could appear in Saudi Labor Court and present his individual testimony, but he would do so without corroboration. Thus, it would be meaningless.

This finding does not render every non Anglo-American forum inadequate, as Defendants claim. The Saudi law is not merely a "procedural difference[ ]" but one that offends the notion of equality before the law on which the American system of justice is premised. This is not a matter of less favorable law or a less beneficial remedy, but one of blatantly discriminatory law which essentially forecloses the relief Plaintiff seeks…. Cf. Presbyterian Church of Sudan v. Talisman Energy, Inc., 244 F.Supp.2d 289, 336 (S.D.N .Y.2003) (holding Sudan inadequate forum based in part on "greatly reduced rights" of plaintiffs under Shari'a law and "total lack of legal personality" and "diminished testimonial competence" for non-Muslim witnesses); UNC Lear Servs., Inc. v. Kingdom of Saudi Arabiaaff'd in part, rev'd in part and remanded, 581 F.3d 210 (5th Cir.2009) (noting discrimination against non-Muslims in Saudi Arabian courts "creates a genuine question as to whether all parties—non-Muslims—will be 'treated fairly,'" but declining to rule on those grounds and proceeding to [resolve the case on a different basis])….

The case can therefore proceed in American courts, without the need to decide whether the forum selection clause was indeed foisted on Petersen through "fraud or overreaching" on Boeing's part.