Supreme Court

On Tuesday May 16th, the U.S. Supreme Court ruled that a federal district court does not have discretion to dismiss a case where all claims are subject to arbitration and a party has requested a stay. This resolves a long-standing circuit split. Continue Reading Supreme Court Says Courts Cannot Dismiss Claims Pending Arbitration When Stay is Requested

In a short, unanimous opinion on April 12, 2024, the Supreme Court shut the door on “pure omission” claims under Rule 10b–5 and made clear that the Rule is limited to claims based on false or misleading statements.

The case, Macquarie Infrastructure Corp. v. Moab Partners, L.P., concerns alleged omissions in Defendant Macquarie’s SEC filings related to its subsidiary’s operation of bulk liquid storage terminals.  In 2016, the United Nations’ International Maritime Organization issued a regulation limiting this subsidiary’s ability to store high-sulfur fuel oil, its single largest product. Though the regulation was set to take effect in 2020, Macquarie did not discuss the regulation in its public filings.Continue Reading Supreme Court rejects pure omission claims under SEC Rule 10b–5

Pennsylvania law requires foreign corporations to register to do business in the Commonwealth and provides that all registrants are subject to suit on “any cause” in the Commonwealth’s courts, regardless of a connection to the jurisdiction. In a split decision, the Supreme Court reversed a Pennsylvania Supreme Court decision finding that this general jurisdiction provision violated the Due Process Clause. Mallory v. Norfolk So. Railway Co., 600 U.S. __ (2023) (slip op. available here).Continue Reading Split Supreme Court Weighs in on Corporate Consent to Personal Jurisdiction

The Supreme Court, in a 5–4 ruling, has resolved a circuit split on the issue of litigation stays pending appeal of denials of motions to compel arbitration.  In the underlying putative class action, Bielski et al v. Coinbase, Inc., 3:21-cv-07478 (N.D. Cal.), Coinbase moved to compel arbitration of the plaintiffs’ claims, but the motion was denied by the district court.  The Ninth Circuit—in a split from several other Circuits—declined to stay the district court proceedings while the appeal was pending.  The Supreme Court now has ruled that a district court must stay proceedings while an interlocutory appeal on the question of arbitrability is ongoing.  The decision means that defendants should be able to minimize ongoing litigation costs while an appeal of an adverse arbitration decision is pending.Continue Reading Supreme Court Resolves Circuit Split to Require Stays Pending Appeal of Refusals to Compel Arbitration

The Supreme Court recently issued its opinion in Gonzalez v. Google LLC, a case about whether Section 230 of the Communications Decency Act (47 U.S.C. § 230) protected YouTube’s recommendation algorithms from a claim of secondary liability under the Anti-Terrorism Act (ATA). In a short, three-page per curiam opinion, the Court avoided addressing the

            The Supreme Court recently declined to review the Sixth Circuit’s decision in Sevier County Schools Federal Credit Union v. Branch Banking & Trust Co., 990 F.3d 470 (6th Cir. 2021), which presents a potential challenge to enforcing arbitration clauses added to standard account agreements.  The cert denial serves as a reminder that companies introducing arbitration agreements should take care to follow all contractual change-of-term requirements and create a record of affirmative customer assent whenever possible.Continue Reading A Closer Look: Arbitration Clauses Added to Account Agreements Face Risks After Supreme Court Declines Review of Sixth Circuit’s BB&T Decision

On May 23, 2022, the Supreme Court unanimously held that a party opposing arbitration is not required to demonstrate prejudice to show that the other party has waived its contractual arbitration rights. 

Before today’s decision, nine federal courts of appeals had adopted the rule that a “party can waive its arbitration right by litigating only when its conduct has prejudiced the other side.”  Morgan v. Sundance, 596 U.S. __ (2022).  Two other circuits had held no showing of prejudice was required.Continue Reading Supreme Court Decision Makes It Easier to Waive Right to Arbitration