- Coinbase succeeded in its effort to submit customer complaints to private arbitration.
- The Supreme Court dismissed the second case, which the exchange asked to review.
Coinbase, a leading crypto exchange platform, succeeded in its effort to submit customer complaints to private arbitration. The U.S. Supreme Court backs the crypto exchange’s request to postpone customer lawsuits.
Coinbase has achieved a significant legal victory in its ongoing battle to resolve customer lawsuits through private arbitration. The U.S. Supreme Court has recently ruled in favor of the crypto exchange in customer lawsuits. This decision comes as a significant win for the exchange.
Consumer’s Lawsuit Against Coinbase
On March 22, the crypto exchange Coinbase revealed that Former Coinbase exchange users had filed claims at the Supreme Court of the United States in two separate cases on the exchange. The lawsuit by the consumer stated that Coinbase violated California law and that the customer had lost more than $30,000 in the crypto market.
The customer, named Abraham Bielski, has filed a lawsuit against the crypto exchange. He claimed that in 2021, a fraudster stole more than $30,000 from his Coinbase account. The lawsuit claims that the exchange broke the Electronic Funds Transfer Act by failing to look into or credit Bielski’s account.
The other lawsuit was filed by former customers, who claimed that Coinbase breached California law against deceptive marketing by attracting individuals into paying to participate in the sweepstakes in 2021. That also offers prices in the popular cryptocurrency Dogecoin.
After Coinbase’s request that the Supreme Court considers the issue, the proceeding regarding the sweepstakes was halted until the end of March. Moreover, the court announces that the decision is due by June.
Supreme Court Rules in Exchange Favor
According to the report, in a 5-4 decision, the justices overruled a lower court’s judgment concerning a user who filed a lawsuit after a fraudster stole money from his account. The crypto exchange filed its appeal and argued that the claims should have been arbitrated. The lower court has allowed the proposed class action case to proceed. The Supreme Court dismissed the second case, which the exchange asked to review.
Coinbase pursues appeals aimed at resolving disputes through private arbitration, which is frequently preferred by businesses over litigation. The crypto exchange claims that arbitration required under its user agreement for the settlement of concerns. And that under the Federal Arbitration Act, which governs dispute resolution proceedings through arbitration.
Arbitration, a method of alternative dispute resolution, has become increasingly popular among companies. It offers a range of benefits, including lower costs, faster resolutions, and confidentiality.
The U.S. high court ruled that the lawsuit claimed by one of the exchange’s users could not proceed until the exchange defends an appeal of a lower court ruling. The Supreme Court didn’t add the crypto issues that Coinbase is facing from the U.S. Securities and Exchange Commission.
The decision comes after U.S. SEC filings against the leading crypto exchanges, including Coinbase. The legal victory in the customer lawsuit expected to boost the exchange’s confidence in the fight against the SEC.
