A Florida court recently ruled on a significant business dispute involving Kuehne + Nagel, Inc. (K+N) and OJ Commerce, LLC (OJC). The District Court of Appeal of Florida addressed the validity of a settlement proposal in light of a choice-of-law provision in their shipping agreement. This decision has implications for how businesses handle contractual agreements and settlement negotiations.
The ruling, issued on May 27, 2026, in case number 4D2025-0114, centers on whether the laws of New York or Florida should apply to a proposal for settlement. The court's decision affects both parties and could influence future cases involving similar contractual disputes.
Kuehne + Nagel, a global logistics company, entered into a shipping agreement with OJ Commerce, an online retail company. Their agreement included a choice-of-law provision stating that New York law would govern any disputes. The conflict arose after OJC sued K+N in Broward County, Florida, following a fallout between the two companies. K+N initially sought to dismiss the case, citing a lack of personal jurisdiction and the choice-of-law provision.
After K+N filed a counterclaim, OJC served a proposal for settlement under Florida law. K+N did not respond to this proposal, leading OJC to argue that K+N had effectively rejected it. Following a jury trial where OJC prevailed, OJC sought attorneys' fees based on the proposal for settlement, which K+N contested, arguing that New York law should apply.
The trial court ruled that K+N had waived the choice-of-law provision and awarded fees under Florida law. However, K+N appealed this decision, leading to the current ruling by the District Court of Appeal.
The court ruled that K+N had not waived its right to enforce the New York law before the settlement proposal was served. The opinion stated, "K+N was, therefore, entitled to evaluate the proposal in accordance with New York law." This means that the proposal for settlement did not create a right to fees under Florida law, as OJC failed to establish that New York law provided a basis for recovering fees.
The court emphasized that K+N had consistently asserted its right to the choice-of-law provision throughout the proceedings. The ruling clarified that a party cannot be deemed to have waived a contractual choice-of-law provision until it fails to assert the out-of-state law when it becomes critical to the case.
As a result of this ruling, the court reversed the trial court's decision to award attorneys' fees to OJC. This outcome underscores the importance of clearly defined choice-of-law provisions in contracts and the need for parties to consistently assert their rights under those provisions throughout litigation.
The impact of this ruling extends beyond the immediate parties involved. Businesses that engage in interstate commerce and enter into contracts with choice-of-law provisions may find this decision relevant. It reinforces the notion that parties must be diligent in asserting their chosen laws in legal disputes, particularly when it comes to settlement proposals.
Additionally, this ruling may set a precedent for future cases involving choice-of-law provisions and the enforceability of settlement proposals. It highlights the necessity for parties to understand the implications of their contractual agreements and the laws that govern them.
Looking ahead, it remains to be seen whether OJC will seek to appeal this ruling or if there are related cases pending that could further clarify the application of choice-of-law provisions in Florida. The court's decision is not final until the disposition of any timely-filed motion for rehearing, which could potentially alter the outcome of this dispute.