N.D. Cal. Judge Invalidates X’s Forum-Selection Clause in Doe v. SpaceXAI

# Case snapshot

# Why the court struck the clause The court applied California unconscionability doctrine, which asks two questions on a sliding scale: (1) Was the contract procedurally unconscionable (lack of meaningful choice, surprise, oppression)? and (2) Was it substantively unconscionable (overly one-sided or unduly harsh)? The presence of significant procedural problems lowers the amount of substantive unfairness needed to invalidate a term, and vice versa.

Procedural problems identified by the court

• Service were presented on a take-it-or-leave-it basis, showing adhesion and lack of meaningful negotiation. The court treated this as at least some procedural unconscionability.
• The forum-selection clause was buried in the middle of the "General" section toward the end of a long printed form, creating "surprise" because the contested term was hidden in prolix drafting.

Substantive problems identified by the court

• The forum-selection clause forced users to litigate exclusively in federal or state courts located in Tarrant County, Texas.
• The clause lacked mutuality: defendants retained the right to sue users in any court in the user's home jurisdiction that had jurisdiction and venue over a claim.
• The defendants did not offer a business justification for imposing that one-sided restriction on users while exempting themselves, making the provision excessively one-sided.

Court's conclusion and immediate consequence Because the clause was materially adhesive and hidden (procedural) and clearly one-sided (substantive), the court concluded the forum-selection clause was unconscionable and therefore unenforceable under California law. The defendants' motion to transfer was premised on that clause, so its enforceability was decisive to their request.

# Parties and counsel

• Plaintiffs are identified as Jane Doe, South Carolina Roe, New Jersey Doe, and Ohio Doe—individuals alleging they were victims of Grok-generated alterations.
• Defendants are SpaceX.AI Corp. and SpaceX.AI LLC.
• Plaintiffs are represented by James Hannaway and Sophia Marie Rios of Berger Montague PC.

# Practical implications for similar litigation

• Lack of mutuality—letting the company sue anywhere while forcing users into a single distant forum—heightens substantive unconscionability risk.
• Courts applying this analysis will weigh procedural and substantive factors on a sliding scale: significant concealment or adhesion can tip the balance even if substantive unfairness alone might be borderline.

# Context note