1. FACTUAL BACKGROUND 4. On January 5, 2024, Mr. Spilker filed a Demand for Arbitration with the American Arbitration Association (“AAA”) against Coinbase, Inc. seeking damages in the amount of $350,000 for withdrawal of staked cryptocurrency, allegedly without his authorization. Ex. A at 2. He alleged that he had been in contact with a “Coinbase Agent” and brought causes of action under the Electronic Funds Transfer Act, tort and common law, breach of contract, California law, Oregon and Idaho law, and federal commodities and securities laws. Ex. A at 2-3; Ex. B. 5. The User Agreement between Mr. Spilker and Coinbase, Inc. provided that the parties agreed to arbitrate any disputes, and that the arbitration would be “in accordance with the American Arbitration Association’s rules for consumer related disputes.” A true and correct copy of the User Agreement is attached hereto as Exhibit C. See Ex. C at § 7.2 (the parties’ agreement to arbitrate and agreement that an award may be enforce
9. On December 17, 2024, Arbitrator Kruze issued an Order Granting Dispositive Motion as to all of Mr. Spilker’s claims. Ex. A at 6 (“Respondent’s Motion for Summary Judgment is GRANTED. Claimant’s claims against Coinbase are dismissed.”). 10. The Final Award holds: a. Claimant’s EFTA cause of action is time-barred because the “one-year limitations period begins when the first unauthorized transfer occurs, not upon discovery by the consumer, and not when the consumer notifies the defendant of the unauthorized transfer.” Id. at 3, applying 15 U.S.C. §1693m(g) and Wike v. Vertrue, Inc., 566 F.3d 590,593 (6th Cir. 2009). b. “The undisputed facts show that a third party, not Coinbase, caused Claimant’s damages” and that “Claimant’s damages were the result of an intervening and superseding cause: the actions of a third-party scammer. Coinbase, as a matter of law, cannot be held liable for Claimant’s damages.” Ex. A at 4, citing May v. Google, LLC, No. 24-CV-01314- BLF, 2024 WL 4681604, at *
Given the recent data breach and Coinbase’s user agreement that aims to force customers into arbitration rather than individual or class action lawsuits, it’s interesting to read the outcome of a recent arbitration case against Coinbase.
