Case Title: Ingres Corporation v. CA, Inc.

Citation: 

Docket Number: 105, 2010

State: delaware

Court: Delaware Supreme Court

Date: 2010-12-01T00:00:00Z

Document:
IN THE SUPREME COURT OF THE STATE OF DELAWARE 
 
INGRES CORPORATION, 
§ 
a Delaware corporation 
§ 
 
 
§ 
No. 105, 2010 
 
Defendant Below,  
§ 
 
Appellant, 
§ 
Court Below:  Court of Chancery 
 
 
§ 
of the State of Delaware  
v. 
 
§ 
 
 
§ 
CA, INC., a Delaware 
§ 
C.A. No. 4300 
corporation 
§ 
 
 
§ 
 
Plaintiff Below, 
§ 
 
Appellee, 
§ 
 
Submitted:  September 1, 2010 
      Decided:  December 1, 2010 
 
Before STEELE, Chief Justice, HOLLAND, BERGER, JACOBS, and 
RIDGELY, Justices, constituting the Court en Banc. 
 
 
Upon appeal from the Court of Chancery.  AFFIRMED. 
 
Kurt M. Heyman, Esquire and Patricia L. Enerio, Esquire of Proctor Heyman LLP, 
Wilmington, DE; Of Counsel: David J. Berger, Esquire (argued) and Katherine L. 
Henderson, Esquire of Wilson Sonsini Goodrich & Rosati PC, San Francisco, CA 
for appellant. 
 
David J. Teklits, Esquire and Kevin M. Coen, Esquire of Morris, Nichols, Arsht & 
Tunnell LLP, Wilmington, DE; Of Counsel: Maria T. Galeno, Esquire (argued) of 
Pillsbury Winthrop Shaw Pittman LLP, New York, NY; Bruce A. Ericson, Esquire 
and Kevin M. Fong, Esquire of Pillsbury Winthrop Shaw Pittman LLP, San 
Francisco, CA; James G. Gatto, Esquire of Pillsbury Winthrop Shaw Pittman LLP, 
Washington, D.C. for appellee. 
 
RIDGELY, Justice: 
2 
This case involves a breach of contract dispute between two software 
companies, Ingres Corporation (“Ingres”) and CA, Inc. (“CA”).  Ingres brought an 
action against CA in the California Superior Court (the “California Action”), 
alleging breach of contract.  CA filed this action against Ingres in the Delaware 
Court of Chancery, requesting preliminary and permanent injunctive relief that 
would prevent Ingres from prosecuting the California Action and require Ingres to 
perform its obligations under various contracts, which addressed related subjects. 
Two of those contracts contained forum selection clauses specifying either 
Delaware or New York as the chosen forum.1  The Court of Chancery denied 
Ingres’s motion to stay this action in favor of the California Action, having 
concluded that deference to the California Action was not required, given the 
agreed upon forum selection clauses.  After a trial, the Court of Chancery ruled 
substantially in favor of CA, awarded CA $2.25 million in fees and costs, and 
enjoined Ingres from prosecuting the California Action.  This appeal followed. 
We find no merit to Ingres’s appeal and affirm on the basis of and for the 
reasons assigned by the Court of Chancery in its Memorandum2 and Letter3 
                                          
 
1 The forum selection clauses relevantly provide: “Each party hereto agrees that it shall bring any 
action or proceeding in respect of any claim directly arising out of or related to this Agreement, 
whether in tort or contract or at law or in equity in any state or U.S. federal court sitting in The 
City of New York or in any state or U.S. federal court sitting in the State of Delaware . . . .”  
(emphasis added). 
2 CA, Inc. v. Ingres Corp., 2009 WL 4575009 (Del. Ch. Dec. 7, 2009). 
3 CA, Inc. v. Ingres Corp., 2010 WL 363846 (Del. Ch. Jan. 26, 2010). 
3 
Opinions.  We also take this opportunity to reaffirm and clarify our holding in 
McWane Cast Iron Pipe Corp. v. McDowell-Wellman Engineering Co.4 
In McWane, this Court held that Delaware courts should exercise discretion 
in favor of a stay where a prior action, involving the same parties and issues, is 
pending elsewhere in a court capable of doing prompt and complete justice.5  As 
Justice Herrmann explained, this rule was “impelled by considerations of comity 
and the necessities of an orderly and efficient administration of justice.”6 
We reaffirm that holding.  But we also clarify McWane’s application in 
cases where a contract identifies Delaware as the chosen forum in a legally 
enforceable forum selection clause.  Consistent with the ruling of the United States 
Supreme Court in M/S Bremen v. Zapata Off-Shore Co.,7 we hold that where 
contracting parties have expressly agreed upon a legally enforceable forum 
selection clause, a court should honor the parties’ contract and enforce the clause, 
even if, absent any forum selection clause, the McWane principle might otherwise 
require a different result.8  The reason is that the McWane principle is a default rule 
                                          
 
4 263 A.2d 281 (Del. 1970). 
5 See id. at 283. 
6 See id. 
7 407 U.S. 1 (1972). 
8 See id. at 15; Elf Atochem North Am., Inc. v. Jaffari, 727 A.2d 286, 287 (Del. 1999) (dismissing 
an action brought in Delaware “on the ground that [an] [a]greement validly predetermined the 
fora in which disputes would be resolved”); Aveta, Inc. v. Delgado, 942 A.2d 603, 607 (Del. Ch. 
2008) (“Delaware courts afford a great deal of respect to a plaintiff’s choice of forum, and this 
respect should be even more stalwart where both parties have agreed in advance to a forum by 
contractual provision.”); Healthtrio, Inc. v. Margules, 2007 WL 544156, at *3 (Del. Super. Jan. 
4 
of common law, which the parties to the litigation are free to displace by a valid 
contractual agreement. 
“Forum selection [] clauses are ‘presumptively valid’ and should be 
‘specifically’ enforced unless the resisting party ‘[] clearly show[s] that 
enforcement would be unreasonable and unjust, or that the clause [is] invalid for 
such reasons as fraud and overreaching.’”9  Courts should assess the 
reasonableness of a forum selection clause on a case-by-case basis. 
Ingres argues that the Court of Chancery erred because one of the executed 
agreements between the parties did not contain an express forum selection clause.  
                                                                                                                                        
16, 2007) (“Delaware courts have held that, if there is a forum selection clause in a contract, 
even when venue where the suit is filed is proper, the court should decline to proceed when the 
parties freely agreed that litigation should be conducted in another forum.”); Outokumpu Eng’g 
Enters. v. Kvaerner Enviropower, Inc., 685 A.2d 724, 733 (Del. Super. 1996) (explaining that 
forum selection clauses are entitled to “substantial weight”); Elia Corp. v. Paul N. Howard Co., 
391 A.2d 214, 216 (Del. Super. 1978) (“[E]ven though venue is proper where suit is filed and a 
court of competent jurisdiction exists, that court should decline to proceed with the cause when 
the parties have freely agreed that litigation shall be conducted in another forum and where such 
agreement is not unreasonable at the time of litigation.”) (citing M/S Bremen, 407 U.S. 1).  See 
also Cent. Contracting Co. v. Maryland Cas. Co., 367 F.2d 341, 345 (3d Cir. 1966) (“So long as 
there is nothing unreasonable in such a provision there is no basis for viewing it as an affront to 
the judicial power, which must be stricken down.”) 
9 Capital Grp. Cos., Inc. v. Armour, 2004 WL 2521295, at *3 (Del. Ch. Nov. 3, 2004) (quoting 
M/S Bremen, 407 U.S. at 15).  See also M/S Bremen, 407 U.S. at 15 (“A contractual choice-of-
forum clause should be held unenforceable if enforcement would contravene a strong public 
policy of the forum in which suit is brought, whether declared by statute or by judicial 
decision.”); Healthtrio, 2007 WL 544156, at *3 (“Mere inconvenience or additional expense is 
not the test of unreasonableness.  In light of present day commercial realities, a forum clause 
should control absent a strong showing that it should be set aside.”) (quoting Eisenmann Corp. v. 
Gen. Motors Corp., 2000 WL 140781, at *7 (Del. Super. Jan. 28, 2000)); Elia, 391 A.2d at 216 
(“Such an agreement is unreasonable only when its enforcement would, under the circumstances 
then existing, seriously impair the plaintiff’s ability to pursue his cause of action.”); Cent. 
Contracting, 367 F.2d at 345 (“[I]t should be respected as the responsible expression of the 
intention of the parties so long as there is no proof that its provisions will put one of the parties to 
an unreasonable disadvantage and thereby subvert the interests of justice.”). 
5 
But in denying Ingres’ motion to stay, the Court of Chancery explained that in 
determining which contracts governed the various disputes, the court must consider 
the entire collection of related contracts, including those that contained forum 
selection clauses specifying Delaware or New York courts as the chosen forum.  
After considering and interpreting all of the related agreements, the Court of 
Chancery concluded that the agreement that did not contain a forum selection 
clause did not supersede those that did.  The Court of Chancery explained: 
Ingres agreed in the fundamental Legacy Support Agreement 
that it would adjudicate all claims in tort or contract that relate 
to these agreements in a specific forum.  By enjoining Ingres 
from proceeding in a different forum, I simply hold it to the 
promises it made — promises that remain binding upon it.  
Obviously, this order intends no disrespect to my distinguished 
judicial colleagues in California; rather, it is compelled by the 
parties’ contracts. 
We agree with that analysis.  Here, the Court of Chancery carefully 
considered the parties’ contractual agreements and enforced the forum selection 
clause included therein.  Ingres has not shown that the clause was unreasonable, 
unjust, or otherwise invalid.  Given the broad forum selection clauses included in 
the parties’ related agreements, the Court of Chancery did not err in enjoining 
Ingres from prosecuting its breach of contract claims in California. 
CONCLUSION 
The judgment of the Court of Chancery is AFFIRMED.