Richards

Opinion by Judge Goodwin; Dissent by Judge Thomas.

The primary question this case presents is whether the antiwaiver provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934 void choice of law and choice of forum clauses in an international transaction. The district court found that they do not. The appeal has been argued twice. Upon reconsideration en banc, the opinion published at 107 F.3d 1422 (9th Cir. 1997) is withdrawn and we affirm the district court.

Background

Appellants, all citizens or residents of the United States, are more than 600 “Names” who entered into underwriting agreements. The Names sued four defendants: the Corporation of Lloyd’s, the Society of Lloyd’s, the Council of Lloyd’s, (collectively, “Lloyd’s”) and Lloyd’s of London, (the “unincorporated association”).

Lloyd’s is a market in which more than three hundred Underwriting Agencies compete for underwriting business. Pursuant to the Lloyd’s Act of 1871-1982, Lloyd’s oversees and regulates the competition for underwriting business in the Lloyd’s market. The market does not accept premiums or insure risks. Rather, Underwriting Agencies, or syndicates, compete for the insurance…

dissenting.

The majority espouses a reasonable foreign policy, but one which emanates from the wrong branch of government. Congress has already explicitly resolved the question at hand. In the Securities Act of 1933 and the Securities Exchange Act of 1934 (the “Acts”), Congress expressly provided that investors cannot contractually agree to disregard United States securities law. Thus, in applying the “reasonableness” policy-weighing approach of M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 , 92 S.Ct. 1907 , 32 L.Ed.2d 513 (1972), the majority displaces Congress’ specific statutory directive. Furthermore, even assuming that the Bremen analysis applies here, the circumstances surrounding this dispute compel the conclusion that enforcement of the choice clauses would be unreasonable. Accordingly, I respectfully dissent.

I.

Unlike the conflict the Bremen Court envisioned between statutes and forum selection clauses, the Acts do not merely declare “a strong public policy” against the waiver of compliance with United States securities laws. Rather, the Acts explicitly and unconditionally prohibit such a waiver. The language of the Securites Act of 1933 is clear and unambiguous:

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