The Court of Appeal for Ontario dismissed Binance’s appeal after a lower court declined to stay a proposed class action and enforce an arbitration agreement contained in Binance’s terms and conditions. The decision carries implications for companies who do retail business or distribute products in multiple jurisdictions, including in Canada.

Background

As a Cayman Islands company, Binance Holdings Limited (“Binance”), together with associated companies, marketed and sold cryptocurrency derivative contracts to Canadian retail investors though the Binance website. In the wake of Binance’s exit from the Ontario market, in June 2022 a proposed class filed an action against Binance in the Superior Court of Justice of Ontario. The proposed class of retail investors argued that Binance distributed securities and investment contracts under Canada’s securities laws, but failed to file or deliver a prospectus required by law.Continue Reading Canadian Appellate Decision Highlights Class Action and Mass Arbitration Risks for Companies in Operating in Multiple Jurisdictions