ABA Banking Journal
No Result
View All Result
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive
SUBSCRIBE
ABA Banking Journal
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive
No Result
View All Result
No Result
View All Result
Home Uncategorized

Supreme Court rules district court must stay proceedings pending appeal of arbitration denial

July 5, 2023
Reading Time: 3 mins read

Arbitration
Coinbase Inc. v. Bielski
Date: June 23, 2023

Issue: Under Section 16(a) of the Federal Arbitration Act (FAA), must a district court stay its proceedings while an interlocutory appeal on the question of arbitration is pending?

Case Summary: In a 5-4 decision written by Justice Brett Kavanaugh, the U.S. Supreme Court ruled a district court must stay its proceedings while an interlocutory appeal on the question of arbitration is pending.

In the case, cryptocurrency (crypto) investors filed a putative class action in the Northern District of California against Coinbase, a cryptocurrency exchange, for its alleged failure to replace stolen funds from their accounts. Coinbase’s User Agreement with the plaintiffs contained an arbitration clause. Coinbase responded to plaintiffs’ lawsuit with a motion to compel arbitration, which district court denied. Coinbase then filed an interlocutory appeal to the Ninth Circuit and moved the district court to stay the proceedings pending resolution of that appeal. The district court denied the initial stay motion. Coinbase next sought a stay pending appeal in the Ninth Circuit, which the Ninth Circuit denied.

The circuit courts have split on whether a stay of the underlying litigation during the interlocutory appeal should be automatic. The Third, Fourth, Seventh, Tenth, Eleventh, and D.C. Circuits have ruled stays should be automatically granted, because allowing litigation to proceed while an appeal is pending eviscerates the benefits of arbitration. The Second, Fifth, and Ninth Circuits, however, have ruled the decision to stay is discretionary.

The Supreme Court reversed the Ninth Circuit and resolved the circuit split, ruling a district court must stay its proceedings while an interlocutory appeal on the question of arbitrability is pending. The majority relied on the Court’s prior decision in Griggs v. Provident Consumer Discount Company (1982). Griggs held that any appeal divests the district court of jurisdiction over those aspects of the case “involved in the appeal.” According to the majority, the “Griggs principle resolves this case” because “it makes no sense for trial to go forward while the court of appeals cogitates on whether there should be one.” As the majority explained, Section 16(a) of the FAA permits interlocutory appeal by right from a district court order denying a party’s motion to compel arbitration. Without an automatic stay of district court proceedings, the majority emphasized “Congress’ decision in § 16(a) to afford a right to an interlocutory appeal would be largely nullified.”

The majority also underscored its ruling would promote the benefits of arbitration. The majority explained allowing a case to proceed simultaneously in the district court and the court of appeals could “waste scarce judicial resources— which could be devoted to other pressing criminal or civil matters—on a dispute that will ultimately head to arbitration in any event.”  This scenario, according to the majority, “represents the worst possible outcome for parties and the courts: litigating a dispute in the district court only for the court of appeals to reverse and order the dispute arbitrated.” The majority concluded Griggs avoids this harmful result.

In dissent, Justice Ketanji Brown Jackson expressed concern about the majority’s “new rule.” Justice Brown declared “this mandatory-general-stay rule for interlocutory arbitrability appeals comes out of nowhere. No statute imposes it. Nor does any decision of this Court. Yet today’s majority invents a new stay rule perpetually favoring one class of litigants—defendants seeking arbitration.”

Bottom Line: The decision is a win for banks because it brings nationwide uniformity and predictability to arbitrability. Under the Ninth Circuit’s approach—now overruled by the Supreme Court—banks could be forced to litigate expensive cases while trying to appeal the threshold issue of arbitrability. The decision eliminates a tactic from potential plaintiffs to forum shop in the Second, Fifth, or Ninth Circuits in hopes of evading an arbitration clause.

Documents: Opinion

Tags: Banking Docket
ShareTweetPin

Related Posts

ABA, trade groups: CFPB has no authority to enact rule limiting arbitration 

ABA files amicus brief urging Oklahoma supreme court to grant Arvest’s petition and reverse lower court’s arbitration ruling

Uncategorized
December 1, 2025

ABA filed an amicus brief urging the Supreme Court of Oklahoma to grant Arvest Bank’s petition to review a Court of Civil Appeals of Oklahoma decision holding that courts — not arbitrators — must decide whether an alleged...

ABA files amicus brief urging Second Circuit to reject EFTA expansion in NYAG’s wire fraud lawsuit

ABA files amicus brief urging Second Circuit to reject EFTA expansion in NYAG’s wire fraud lawsuit

Uncategorized
December 1, 2025

ABA filed a coalition amicus brief urging the Second Circuit to reverse the district court’s denial of Citibank’s motion to dismiss the New York Attorney General’s EFTA claims.

ABA files amicus brief supporting Flagstar’s petition for full Ninth Circuit review to examine NBA preemption

ABA files amicus brief supporting Flagstar’s petition for full Ninth Circuit review to examine NBA preemption

Uncategorized
December 1, 2025

ABA filed a coalition amicus brief urging the Ninth Circuit to grant Flagstar Bank’s en banc petition to review a three-judge panel’s decision that ruled the National Bank Act does not preempt California’s interest-on-escrow law.

Eleventh Circuit affirms Wells Fargo’s win in bitcoin fraud lawsuit

Consumer class sues Athena Bitcoin over undisclosed BTM fees

Uncategorized
December 1, 2025

A proposed consumer class sued Athena Bitcoin, one of the largest Bitcoin ATM operators, in the Southern District of Florida, alleging it violated the Florida Deceptive and Unfair Trade Practices Act by using inflated exchange rates, undisclosed surcharges,...

Supreme Court upholds government authority to dismiss False Claims Act cases

Northern District of California grants second partial dismissal in PayPal merchant-agreement class action

Uncategorized
December 1, 2025

Judge Jeffrey S. White of the Northern District of California granted in part and denied in part a proposed class action alleging PayPal illegally inflated online retail prices through restrictive merchant agreements.

ACA International sues to block Colorado’s medical debt reporting ban

ACA International sues to block Colorado’s medical debt reporting ban

Uncategorized
December 1, 2025

ACA International and Creditors Bureau USA sued Administrator of the Uniform Consumer Credit Code, Martha Fulford in Colorado federal court to block a Colorado law banning medical debt from credit reports.

NEWSBYTES

FDIC, OCC repeal guidance on leveraged lending

December 5, 2025

Consumer credit increased in November

December 5, 2025

ABA DataBank: Volatility shifts as chances of rate cut increase

December 5, 2025

SPONSORED CONTENT

Seeing More Check Fraud and Scams? These Educational Online Toolkits Can Help

Seeing More Check Fraud and Scams? These Educational Online Toolkits Can Help

November 1, 2025
5 FedNow®  Service Developments You May Have Missed

5 FedNow® Service Developments You May Have Missed

October 31, 2025

Cash, Security, and Resilience in a Digital-First Economy

October 20, 2025
Rethinking Outsourcing: The Value of Tech-Enabled, Strategic Growth Partnerships

Rethinking Outsourcing: The Value of Tech-Enabled, Strategic Growth Partnerships

October 1, 2025

PODCASTS

Podcast: The outlook for tech-forward community banking

December 4, 2025

Podcast: The Erie Canal at 200

November 6, 2025

Podcast: Why branches are top priority for PNC

October 23, 2025

American Bankers Association
1333 New Hampshire Ave NW
Washington, DC 20036
1-800-BANKERS (800-226-5377)
www.aba.com
About ABA
Privacy Policy
Contact ABA

ABA Banking Journal
About ABA Banking Journal
Media Kit
Advertising
Subscribe

© 2025 American Bankers Association. All rights reserved.

No Result
View All Result
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive

© 2025 American Bankers Association. All rights reserved.