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Coinbase, Inc. v. Bielski

Summarized by:

  • Court: 9th Circuit Court of Appeals Archives
  • Area(s) of Law: Arbitration
  • Date Filed: 06-23-2023
  • Case #: 22-105
  • Judge(s)/Court Below: KAVANAUGH, J., delivered the opinion of the Court, in which ROBERTS, C. J., and ALITO, GORSUCH, and BARRETT, JJ., joined. JACKSON, J., filed a dissenting opinion, in which SOTOMAYOR and KAGAN, JJ., joined in full, and in which THOMAS, J., joined as to Parts II, III and IV.

Whether the district court must stay its pre-trial and trial proceedings while the interlocutory appeal is ongoing under 9 U.S.C. 搂16(a).

Coinbase operates an online platform on which users can buy and sell cryptocurrencies. When creating an account, individuals agree to the terms in Coinbase’s User Agreement. This agreement contains an arbitration provision, which directs that any disputes arising under the agreement be resolved through binding arbitration. This is a putative class action filed against Coinbase in the US District Court for the Northern District of California. Abraham Bielski sued on behalf of Coinbase users who alleged that Coinbase failed to replace funds fraudulently taken from the users’ accounts. The District Court denied Coinbase’s motion to compel arbitration. Coinbase filed an interlocutory appeal to the US Court of Appeals for the Ninth Circuit, under the Federal Arbitration Act, 9 U.S.C. §16(a). Coinbase also moved to stay District Court proceedings pending resolution of the arbitration issue, which the District Court denied. The Ninth Circuit also denied this motion under Britton v. Co-op Banking Group, 916 F. 2d 1405, 1412 (1990), which provides that an appeal from the denial of a motion to compel arbitration does not automatically stay district court proceedings. Most other Circuits have held that a district court must stay its proceedings while the interlocutory appeal on the question of arbitrability is ongoing. E.g., Bradford-Scott Data Corp. v. Physician Computer Network, Inc., 128 F. 3d 504, 506 (CA7 1997).The Supreme Court found that "the Griggs principle" provides that “an appeal, including an interlocutory appeal, divests the district court of its control over those aspects of the case involved in the appeal.” Griggs v. Provident Consumer Discount Co., 459 U.S. 56, 58. The Court held that Respondent’s arguments against the Griggs principle were unpersuasive and that as applied here, the District Court was required to compel arbitration. Reversed and remanded.

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