Coinbase Wins Supreme Court Ruling in Arbitration Lawsuit – Coinbase, a cryptocurrency exchange, received a favorable decision from the U.S. Supreme Court on Friday. The court ruled that a lawsuit brought by one of Coinbase’s users cannot move forward until Coinbase defends an appeal against a lower court’s ruling.
The ruling, with a 5-4 majority, permits Coinbase to pursue arbitration in its attempt to resolve the putative class action lawsuit, effectively pausing the lawsuit’s advancement in the federal court system. Although this outcome is a victory for Coinbase, it has limited impact on the broader cryptocurrency industry.” “The sole question here is whether the district court must stay its pre-trial and trial proceedings while the interlocutory appeal is ongoing.”
People Also Read: Binance US Market Share Shrinks Amid Legal Battle With SEC
“The answer is yes: The district court must stay its proceedings,” wrote Justice Brett Kavanaugh on behalf of the majority. Coinbase faced a setback in the putative class action lawsuit as the U.S. District Court for the Northern District of California rejected its motion to enforce arbitration, and the subsequent appeal also went against Coinbase. Initially, the lawsuit was scheduled to move forward regarding certain aspects of the case.
The Supreme Court’s ruling is specific to the involvement of Coinbase as one of the parties and does not delve into broader cryptocurrency matters. Nevertheless, this milestone signifies the first instance of a cryptocurrency company presenting arguments before the U.S. Supreme Court, potentially influencing other lawsuits filed against the crypto exchange.
Coinbase can continue trying to compel arbitration after Friday’s ruling. “We anticipate that the Ninth Circuit here, as we anticipate in appeals more generally, will proceed with appropriate expedition when considering Coinbase’s interlocutory appeal from the denial of the motion to compel arbitration,” the ruling said. “We reverse the judgment of the Court of Appeals and remand the case for further proceedings consistent with this opinion.”
People Also Read: Crypto Detective ZachXBT Faces Defamation Lawsuit
Justice Ketanji Brown Jackson, who authored a dissent with support from Justices Elena Kagan and Sonia Sotomayor (and with Justice Clarence Thomas signing on to some sections), wrote that allowing the case to proceed would enable a balancing of all involved interests. “The Court concludes for the first time that an interlocutory appeal about one matter (arbitrability) bars the district court from proceeding on another (the merits). That logic has such significant implications for federal litigation that the majority itself shies away from the Pandora’s box it may have opened,” Jackson wrote.
