In the United States Court of Appeals For the Second Circuit

August Term, 2022 No. 22-1747

BENZION RABINOWITZ, Petitioner-Appellant,

v.

LEVI KELMAN, Respondent-Appellee.

On Appeal from a Judgment of the United States District Court for the Southern District of New York.

ARGUED: MARCH 1, 2023 DECIDED: JULY 24, 2023

Before: JACOBS, PARK, and NARDINI, Circuit Judges.

Petitioner-Appellant Benzion Rabinowitz appeals from a July 14, 2022, judgment of the United States District Court for the Southern District of New York (Nelson S. Román, Judge) dismissing his petition to confirm an arbitral award. The court held that a forum selection clause in the parties’ arbitration agreement required that any confirmation action be brought in the state courts of New Jersey or New York, and that this deprived the district court of subject matter jurisdiction. We conclude that the district court erred in dismissing Rabinowitz’s petition. First, we hold that the petition adequately pleaded subject matter jurisdiction based on diversity of citizenship. Because parties cannot contractually strip a district court of its subject matter jurisdiction, it was error to conclude that the forum selection clause did so. Second, we interpret the relevant forum selection clauses as permissive arrangements that merely allow litigation in certain fora, rather than mandatory provisions that require litigation to occur only there. Accordingly, applying the modified forum non conveniens framework, we hold that the forum selection clauses did not bar proceedings from going forward in the United States District Court for the Southern District of New York. We therefore VACATE the judgment of dismissal and REMAND to the district court for further proceedings.

EFREM SCHWALB (Tal S. Benschar on the brief), Koffsky Schwalb LLC, New York, NY for Petitioner-Appellant.

DOMINIC J. APRILE, Bathgate, Wegener & Wolf, P.C., Lakewood, NJ for Respondent- Appellee.

WILLIAM J. NARDINI, Circuit Judge:

Benzion Rabinowitz and Levi Kelman submitted a dispute to a panel of arbitrators, which ordered Kelman to pay $4,000,000.

2 Rabinowitz moved to confirm the award in the United States District Court for the Southern District of New York (Nelson S. Román, Judge), but the court dismissed the petition for lack of subject matter jurisdiction. The court held that a forum selection clause in the parties’ arbitration agreement required that any confirmation action be brought in the state courts of New Jersey or New York, and that this deprived the district court of subject matter jurisdiction.

We conclude that the district court erred in two respects. First, we hold that the petition adequately pleaded subject matter jurisdiction based on diversity of citizenship under 28 U.S.C. § 1332. Because parties cannot contractually strip a district court of its subject matter jurisdiction, it was error to conclude that the forum selection clause did so. Second, we interpret the relevant forum selection clauses as permissive arrangements that merely allow litigation in certain fora, rather than mandatory provisions that require litigation to occur only there. Accordingly, applying the modified forum non

3 conveniens framework, we hold that the forum selection clauses did not bar proceedings from going forward in the United States District Court for the Southern District of New York. We therefore vacate the judgment of dismiss