New England Biz Law Update
The U.S. Supreme Court has agreed to hear a case raising the issue of whether trial court proceedings should be paused during the appeal of a denial of a defendant’s motion to compel arbitration.
Employers’ groups and advocates for employees are eagerly awaiting the ruling.
The question comes from a pair of cases involving the cryptocurrency exchange Coinbase Global Inc. In those cases, Coinbase users successfully blocked the company’s attempts to send disputes to arbitration.
The 9th U.S. Circuit Court of Appeals said it would not pause proceedings while it considered Coinbase’s appeal.
If the Supreme Court establishes a precedent that an employee’s lawsuit is required to move forward while the defendant appeals a denial to compel arbitration, it could cause employers to be fighting two legal matters at the same time.
If the court says the suit is stayed, it could keep employees’ cases pending for many years while they wait on employers’ appeals.
According to Coinbase’s petition, the 3rd, 4th, 7th, 10th, 11th, and D.C. circuits all have precedent holding that underlying litigation will be automatically stayed while a defendant’s appeal of a court’s denial of a motion to compel arbitration is ongoing.
The 2nd, 5th, and 9th Circuits have held that the trial court can decide whether a case should be continued or paused during such an appeal.
The Federal Arbitration Act does not mention whether an automatic stay should be granted while an employer’s appeal in such a case is ongoing.
