Corporate Accountability

RELEASE: Justices Should Reject Coinbase’s Attempt to Craft Special Rules for Companies Seeking Arbitration

WASHINGTON, DC – Following oral argument at the Supreme Court this morning in Coinbase v. Bielski and Coinbase v. Suski, two cases in which Coinbase is trying to make it more difficult for individuals who have been injured by the company to have their day in court, Constitutional Accountability Center Appellate Counsel Smita Ghosh issued the following reaction:

The Supreme Court heard argument today in two cases in which consumers hope to hold Coinbase accountable in court for various alleged violations of state and federal law. Coinbase has been seeking to keep these consumers out of court, arguing that they agreed to arbitrate their disputes in a click-through user agreement that the consumers allegedly agreed to when creating Coinbase accounts. And now, before the Supreme Court, Coinbase is arguing that the district court must pause the litigation in these cases while the court of appeals reviews the decision denying its effort to compel arbitration.

Coinbase’s argument is wrong. Indeed, it fundamentally distorts the statute on which it purports to rely. At argument this morning, several justices seemed to recognize as much, suggesting that Coinbase seems to seek a special rule not written into law for the benefit of companies seeking arbitration. As the Chief Justice observed, the arbitration statute Coinbase points to gives “huge benefits” to defendants invoking arbitration agreements, but it does not address the particular benefit—a stay of litigation—for which Coinbase is asking.

Echoing our brief on the issue, the Chief Justice emphasized that Coinbase seeks a privilege that is “not granted in the statute.” As our brief makes clear, Coinbase is attempting to read a lot into Congress’s silence. The company argues that Congress silently and invisibly imposed a categorical rule that would strip courts of the discretion to determine whether a stay is appropriate that they generally enjoy—an approach that is, as Justice Jackson put it, “exactly backwards.”

While the legal issues in the case may seem highly technical, the stakes are significant. As Justice Kagan pointed out, ruling in Coinbase’s favor would jeopardize consumers’ “right to have their case litigated in a courtroom” by permitting companies to delay the resolution of their claims. Fortunately for individuals seeking to hold companies like Coinbase accountable, the law is simply not on Coinbase’s side, and the Court should recognize that in these cases.

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Resources:

Case page in Coinbase, Inc. v. Bielski & Coinbase, Inc. v. Suski: https://www.theusconstitution.org/litigation/coinbase-inc-v-bielski-coinbase-inc-v-suski/

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Constitutional Accountability Center is a nonpartisan think tank and public interest law firm dedicated to fulfilling the progressive promise of the Constitution’s text, history, and values. Visit CAC’s website at www.theusconstitution.org.

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