December 5, 2024

The “Roundup” Round-Up: Will a Recent Third Circuit Ruling Spell the End for Roundup Products Liability Litigation in Pa. State Courts?

Harrisburg, PA

The Legal Intelligencer

(by Casey Alan Coyle and Michael Libuser)

Over 100,000 cases have been brought against Monsanto Corporation nationwide, claiming its Roundup™ weed-killer contains a carcinogenic active ingredient, namely, glyphosate.  Hundreds of such cases are pending in Pennsylvania alone.  But for over 30 years, the U.S. Environmental Protection Agency (“EPA”) has found evidence of glyphosate’s non-carcinogenicity for humans, and in 2015, the EPA determined “that glyphosate is not likely to be carcinogenic to humans.”  EPA, “Glyphosate,” https://www.epa.gov/ingredients-used-pesticide-products/glyphosate.

This long-held conclusion regarding the non-carcinogenicity of glyphosate informed the EPA’s decision to approve a label for Roundup that omitted any cancer warning.  By approving (and reapproving, over decades) Roundup’s label—pursuant to its authority under the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. § 136 et seq. (“FIFRA”)—the EPA effectively foreclosed litigants from asserting state-law product liability claims against Monsanto based on a purported duty to warn for failing to include a cancer warning on Roundup’s label.  This is so because, as the U.S. Court of Appeals for the Third Circuit recently held in Schaffner v. Monsanto Corp., 113 F.4th 364 (3d Cir. 2024), FIFRA expressly preempts any such claims.

To many, Schaffner appeared to provide the last word on the subject.  But some Pennsylvania state courts have declined to adhere to FIFRA-preemption in the wake of the decision.  Last month, for example, the Philadelphia Court of Common Pleas concluded a trial—involving, in part, the same state-law failure-to-warn claim deemed preempted in Schaffner—resulting in a $78 million verdict for the plaintiffs.  Melissen v. Monsanto Co., No. 210602578 (Phila. Cnty. C.C.P. Oct. 10, 2024).  To borrow from Dickens, there appears to be a Tale of Two Courts within Pennsylvania—federal courts (where FIFRA-preemption applies), and state courts (where it does not)—resulting in, among other problems, discord, non-uniformity, confusion, and incentivization of forum-shopping.

December 3, 2024

Final Erosion and Sediment Control General Permit for Earth Disturbance Associated with Oil and Gas Activities Published (ESCGP-4)

Pittsburgh, PA and Washington, DC

FNREL Water Law Newsletter

(by Lisa M. Bruderly, Jessica Deyoe and Mackenzie M. Moyer)

On October 5, 2024, the Pennsylvania Department of Environmental Protection (PADEP) published notice of the final Erosion and Sediment Control General Permit for Earth Disturbance Associated with Oil and Gas Exploration, Production, Processing, or Treatment Operations or Transmission Facilities (ESCGP-4). See 54 Pa. Bull. 6341 (Oct. 5, 2024). ESCGP-4 became effective October 5, 2024, and will expire on October 5, 2029. The current ESCGP-3 is scheduled to expire on January 6, 2025, following an administrative extension from October 6, 2023. PADEP will continue to accept applications for ESCGP-3 until October 11, 2024.

There are several notable differences between ESCGP-3 and ESCGP-4. ESCGP-4 requires that if a discharge approved for coverage under ESCGP-4 subsequently exhibits a condition rendering it ineligible for coverage under the permit, ESCGP-4 requires the permittee to promptly take action to restore eligibility, notify PADEP in writing of the condition, and submit an individual erosion and sediment control permit application to PADEP if eligibility cannot be restored. ESCGP-3 had no such requirement for discharges that became ineligible after approval under the permit.

Under ESCGP-3, weekly inspections of controls were required, as well as inspections following stormwater events. ESCGP-4 adds an inspection requirement following “snowmelt sufficient to cause a discharge” and requires that inspections be documented using PADEP’s Chapter 102 Visual Site Inspection Report form (No. 3800-FM-BCW0271d) or a similar form that contains the same information. ESCGP-4 also requires that “qualified personnel, trained and experienced in erosion and sediment control and post-construction stormwater management” complete the required inspections and outlines requirements for such qualifications. Further, ESCGP-4 requires the initiation of repair or replacement of a best management practice or stormwater control measure (SCM) within 24 hours of discovery of an issue, if there is no likelihood of a pollutional incident.

December 3, 2024

PADEP Presents Update on the OOOOc Rulemaking to the Air Quality Technical Advisory Committee

Pittsburgh, PA

FNREL Mineral and Energy Law Newsletter

Pennsylvania – Oil & Gas

(by Joe ReinhartSean McGovern, Matt Wood and Alexandra Graf)

On October 10, 2024, the Pennsylvania Department of Environmental Protection (PADEP) presented an update on and summary of OOOOc Rulemaking to the Bureau of Air Quality’s Air Quality Technical Advisory Committee (AQTAC). See PowerPoint Presentation, PADEP, “Emissions Guidelines (EGs) for Greenhouse Gas (GHG) Emissions from Existing Crude Oil & Natural Gas Facilities (40 CFR Part 60 Subpart OOOOc)” (Oct. 10, 2024). On March 8, 2024, the U.S. Environmental Protection Agency (EPA) finalized its rule targeting methane emissions from the oil and natural gas sector (the Methane Rule), which established new source performance standards (NSPS) for facilities built, modified, or reconstructed after December 6, 2022 (OOOOb), as well as emissions guidelines (EG) for states to follow in designing and executing state plans for existing sources (OOOOc). See Standards of Performance for New, Reconstructed, and Modified Sources and Emissions Guidelines for Existing Sources: Oil and Natural Gas Sector Climate Review, 89 Fed. Reg. 16,820 (Mar. 8, 2024) (to be codified at 40 C.F.R. pt. 60). The Methane Rule applies to oil and gas facilities involved in production and processing (including equipment and processes at well sites, storage tank batteries, gathering and boosting compressor stations, and natural gas processing plants) and natural gas transmission and storage (including compressor stations and storage tank batteries). The Rule requires frequent monitoring and repair of methane leaks at well sites, centralized production facilities, and compressor stations using established inspection technologies or, at an operator’s selection, novel advanced detection technologies.

December 3, 2024

PUC Issues Final Regulations for Petroleum Products and Other Hazardous Liquids in Intrastate Commerce

Pittsburgh, PA

FNREL Mineral and Energy Law Newsletter

Pennsylvania – Oil & Gas

(by Joe ReinhartSean McGovernMatt Wood and Alexandra Graf)

On September 14, 2024, the Pennsylvania Public Utility Commission (PUC) published its Rulemaking Regarding Hazardous Liquid Public Utility Safety Standards at 52 Pa. Code Chapter 59 in the Pennsylvania Bulletin, the purpose of which is to “establish State public utility safety standards addressing localized concerns for hazardous liquid public utilities constructing, operating, and maintaining pipeline facilities.” 54 Pa. Bull. 5729 (Sept. 14, 2024). The rulemaking specifically applies to public utility intrastate hazardous liquid pipelines and facilities. It does not apply to Act 127 of 2011 (the Gas and Hazardous Liquids Pipelines Act), 58 Pa. Stat. §§ 801.101—.1101, pipelines or solely interstate hazardous liquid pipelines. The rule primarily establishes new standards for governing hazardous liquid public utilities (HLPUs) and related activities, such as constructing new pipelines; converting, relocating, or replacing existing pipelines; and reporting requirements. It also includes requirements for operations and maintenance, qualifications for pipeline personnel and land agents, and corrosion control standards for all HLPUs. Currently, there are only two certified HLPUs in Pennsylvania. In addition, the PUC made minor revisions to regulations applicable to gas service.

Among other things, the rulemaking includes requirements for conducting geological and environmental impact studies related to pipeline construction and conducting inspections and maintenance of depth of cover for pipes transporting hazardous liquids, construction, and clearance between pipes and underground structures. The rule also prevents constructing, relocating, or converting pipelines under existing buildings and establishes requirements for girth weld testing. More broadly, the rule is intended to improve communications between stakeholders, including the utilities, the public, local government entities, and others.

December 3, 2024

PADEP Begins Accepting Grant Applications for Plugging Orphaned Oil and Gas Wells

Pittsburgh, PA

FNREL Mineral and Energy Law Newsletter

Pennsylvania – Oil & Gas

(by Joe ReinhartSean McGovernMatt Wood and Alexandra Graf)

On October 9, 2024, the Pennsylvania Department of Environmental Protection (PADEP) began accepting applications for grants to plug abandoned oil and gas wells. See Press Release, PADEP, “Shapiro Administration Launches New Program in Pennsylvania to Plug Orphan Oil and Gas Wells, Creating Jobs and Cutting Methane Emissions in the Commonwealth” (Oct. 2, 2024). PADEP said that this new program is intended to reduce greenhouse gas emissions from orphaned wells that have the potential to leak methane, while also supporting job growth in the energy sector. An orphaned well is defined by section 3202 of the Pennsylvania Oil and Gas Act as “a well abandoned prior to April 18, 1985, that has not been affected or operated by the present owner or operator and from which the present owner, operator or lessee has received no economic benefit other than as a landowner or recipient of a royalty interest from the well.” According to PADEP, Pennsylvania has more than 350,000 orphaned and abandoned wells, which contribute to approximately 8% of the state’s total methane emissions.

The total amount of available funding is $16.8 million, and applicants can apply to plug up to five wells per application, with subawards based on well depths. A maximum of $40,000 will be awarded for each well that is 3,000 feet or less, and a maximum of $70,000 will be awarded for wells greater than 3,000 feet. The grants are available to Qualified Well Pluggers, defined as a “person who demonstrates access to equipment, materials, resources and services to plug wells in accordance with statutory and regulatory requirements.” An applicant may apply to plug additional wells once the last well under its current application is adequately plugged, PADEP issues a plugging certificate, and all terms and conditions of the grant agreement have been satisfied.

December 3, 2024

PADEP Publishes Final Erosion and Sediment Control General Permit-4

Pittsburgh, PA

FNREL Mineral and Energy Law Newsletter

Pennsylvania – Oil & Gas

(by Joe ReinhartSean McGovernMatt Wood and Alexandra Graf)

On October 5, 2024, the Pennsylvania Department of Environmental Protection (PADEP) issued a notice publishing the final Erosion and Sediment Control General Permit-4 (ESCGP-4) for Earth Disturbance Associated with Oil and Gas Exploration, Production, Processing, or Treatment Operations or Transmission Facilities. 54 Pa. Bull. 6341 (Oct. 5, 2024). In September 2024, PADEP published a Comment Response Document to comments it received during the comment period from June 29, 2024, to July 29, 2024, and incorporated those comments into ESCGP-4. See PADEP, Comment Response Document (Sept. 2024). In response to comments, PADEP did not eliminate the expedited review process for the ESCGP-4 permit, and noted that there are minimal differences between ESCGP-3 and ESCGP-4.

However, there are several notable changes and additions in ESCGP-4, including (1) where an approved discharge later becomes ineligible for coverage, the permittee must promptly act to restore eligibility and notify PADEP, or apply for an individual erosion and sediment control permit if eligibility cannot be restored; (2) the imposition of a new 60-day deadline to submit the notice of intent (NOI) before the planned date for initiating any new discharge; (3) a weekly inspection requirement after “snowmelt sufficient to cause a discharge” occurs, which must be completed by qualified personnel who meet the enumerated requirements under the permit; (4) that repair or replacement actions be implemented within 24 hours of discovery of an issue, where ESCGP-3 required immediate action; and (5) for any stormwater control measure that is not authorized by PADEP manuals, the permittee must receive PADEP approval and comply with related requirements.

December 3, 2024

OSMRE Approves Amendment to the Pennsylvania Abandoned Mine Land Reclamation Plan

Pittsburgh, PA

FNREL Mineral and Energy Law Newsletter

Pennsylvania – Mining

(by Joe Reinhart, Sean McGovern, Christina Puhnaty and Alexandra Graf)

On August 16, 2024, the Office of Surface Mining Reclamation and Enforcement (OSMRE) approved Pennsylvania’s proposed modification of its Pennsylvania Abandoned Mine Land Reclamation Plan under the Surface Mining Control and Reclamation Act of 1977 (SMCRA) by adding Reclamation Plan Amendment No. 3 to allow the Pennsylvania Department of Environmental Protection (PADEP) to administer a State Emergency Abandoned Mine Land Reclamation Program. See 89 Fed. Reg. 66,563 (Aug. 16, 2024). Pennsylvania submitted Reclamation Plan Amendment No. 3 for approval to OSMRE in 2016. Reclamation Plan Amendment No. 3 covers coordination of emergency reclamation work between Pennsylvania and OSMRE as well as procedures for implementing the National Environmental Policy Act and other Pennsylvania procedures. The Pennsylvania Abandoned Mine Land Reclamation Plan, including its amendments, is available here.

Emergency response reclamation activities involve “enter[ing] upon any land where an eligible abandoned coal mine related emergency exists . . . to restore, reclaim, abate, control, or prevent the adverse effects of legacy coal mining practices and to do all things necessary or expedient to protect the public health, safety, or general welfare.” Reclamation Plan Amendment No. 3, pt. G(I) (citing SMCRA § 410(b), 30 U.S.C. § 1240(b)). Pennsylvania defines an “emergency” in Reclamation Plan Amendment No. 3 as “a sudden danger or impairment or previously unknown condition, related to legacy coal mining, which represents a high probability of substantial physical harm to health, safety or general welfare . . . .” Id. at pt.

December 3, 2024

Streamlining Permits for Economic Expansion and Economic Development (SPEED) Program Announced

Pittsburgh, PA and Washington, DC

FNREL Water Law Newsletter

(by Lisa M. BruderlyJessica Deyoe and Mackenzie M. Moyer)

On August 12, 2024, the Pennsylvania Department of Environmental Protection (PADEP) announced the launch of an initiative from the 2024–25 Budget, Fiscal Code H.B. 2310, signed into law by Governor Shapiro on July 11, 2024, to modernize the permit review process. See Press Release, PADEP, “DEP Launches Two New Initiatives from 2024-25 Budget to Continue to Speed Up Permitting Process” (Aug. 12, 2024). The initiative, Streamlining Permits for Economic Expansion and Development (SPEED) Program, is intended to help PADEP reduce backlogs
and process permits more quickly.

The SPEED Program allows permit applicants to use PADEP-verified and qualified third-party contractors to conduct initial reviews of applications for eligible permit types. PADEP was required to issue a request for proposal by mid-October to identify qualified third-party contractors for the SPEED Program. Permits eligible for the SPEED program include air quality plan approvals (state-only) (Pa. Code ch. 127), earth disturbance permits (Pa. Code ch. 102), individual water obstruction and encroachment permits (Pa. Code ch. 105), and dam safety permits (Pa. Code ch. 105). Permit applicants that choose to use a third-party reviewer must pay for any costs associated with the qualified professional’s review of the permit application.

Permits under the SPEED Program are subject to specific timelines established in PADEP’s Permit Decision Guarantee Policy, see Exec. Order No. 2012-11, “Policy for Implementing the Department of Environmental Protection (Department) Permit Review Process and Permit Decision Guarantee” (Nov. 2, 2012), or separate permit decision timelines if agreed to by PADEP and the applicant. The permit decision timeline starts once the qualified professional certifies to PADEP that no conflict of interest exists with the permit applicant.

November 26, 2024

The Moving Goalposts of Overtime Exemption: Texas Judge Invalidates 2024 Salary Threshold Rule

Pittsburgh, PA

The Legal Intelligencer

(by Steve Antonelli and Alex Farone)

Just as many employers were finalizing their 2025 budgets, on November 15, 2024, a federal court in Texas issued a nationwide injunction six weeks before the second of two meaningful changes to the federal overtime law was set to take effect.

Unless specifically exempted, the Fair Labor Standards Act (FLSA) requires covered employees to be paid overtime when they work more than 40 hours during a week.  One group of employees that is exempted from the overtime requirements are those who qualify as executive, administrative, or professional (EAP) employees.  To qualify for this overtime exemption, workers must perform certain job duties and be paid on a salary basis.  Until earlier this year, to qualify for the exemption, workers had to be paid a minimum yearly salary of $35,568.  In other words, those employees who earned in excess of this amount did not have to be paid overtime if they worked more than 40 hours in a week.

In April 2024, the U.S. Department of Labor (DOL) announced a final rule that qualified millions of additional employees for overtime pay because it increased the salary threshold required for the EAP exemption.  The rule was to be implemented in phases. The first phase took effect on July 1 and called for an immediate increase to the minimum salary.  Specifically, the first phase increased the salary threshold for the EAP exemption from $35,568 (which is $684/week) to $43,888 per year (which is $844/week).  To comply with the new rule, employers across the nation had to increase the minimum salary paid to EAP employees by July 1, 2024, to avoid paying overtime to those workers.

November 14, 2024

Best Practice for Conducting an Effective Internal Company Investigation

Pittsburgh, PA

Pittsburgh Technology Council

(by Kevin Douglass, Carla Castello and Stephen Antonelli)

Today’s businesses are subject to increasing workplace scrutiny concerning possible misconduct of their owners, officers, management, and personnel. When faced with an allegation that can potentially expose the company to legal, financial and reputational harm, it is critical that the company promptly investigate the facts and assess the business risk in order to make an informed decision on the best course of action.

Is an Internal Company Investigation Warranted?

Employee complaints, or even allegations from third parties, concerning improper workplace conduct should always be taken seriously. Whether the claims involve an entry level employee, a manager, a corporate officer, or anyone in between, the company should assess whether the allegations, if true, would constitute violations of law or company policies, or otherwise materially impact the company’s finances, culture, reputation, or workforce.

Workplace investigations are often sensitive. Employees may be reluctant to step forward and become the center of an investigation. They may also fear backlash from the individual(s) being investigated, particularly if they carry significant clout within the company. The company can assuage those concerns by reminding employees involved in the investigation of the company’s obligation to comply with applicable anti-retaliation laws and company policies. The company should also explain that it will perform the investigation with impartiality and (as much as possible) confidentiality, and that it will comply with the organization’s policies and procedures while minimizing business disruption.

Planning for and Conducting the Investigation

At the outset, the company must define the scope and purpose of the investigation (i.e. identify the allegations and the reasons for undertaking the investigation), select an investigation team, and determine a timeline for the investigation.

November 7, 2024

Babst Calland Ranked in 2025 Best Law Firms®

Pittsburgh, PA, Charleston, WV, Washington, DC

Babst Calland has been recognized in the 2025 edition of Best Law Firms®, ranked by Best Lawyers®, nationally in 8 practice areas and regionally in 38 practice areas:

  • National Tier 2
    • Environmental Law
    • Land Use and Zoning Law
    • Litigation – Construction
    • Litigation – Environmental
  • National Tier 3
    • Energy Law
    • Mining Law
    • Natural Resources Law
    • Oil and Gas Law
  • Regional Tier 1
    • Pittsburgh
      • Bet-the-Company Litigation
      • Commercial Litigation
      • Construction Law
      • Corporate Law
      • Energy Law
      • Environmental Law
      • Land Use and Zoning Law
      • Litigation – Construction
      • Litigation – Environmental
      • Litigation – Land Use and Zoning
      • Municipal Law
      • Natural Resources Law
      • Water Law
    • Charleston-WV
      • Business Organizations (including LLCs and Partnerships)
      • Commercial Litigation
      • Energy Law
      • Environmental Law
      • Litigation – Environmental
      • Oil and Gas Law
  • Regional Tier 2
    • Pittsburgh
      • Information Technology Law
      • Labor Law – Management
      • Real Estate Law
    • Charleston-WV
      • Arbitration
      • Banking and Finance Law
      • Commercial Transactions / UCC Law
      • Corporate Law
      • Mining Law
      • Natural Resources Law
    • Washington, D.C.
      • Energy Law
      • Environmental Law
      • Litigation – Environmental
      • Oil and Gas Law
  • Regional Tier 3
    • Pittsburgh
      • Litigation –
November 4, 2024

Office Politics: The Basics for Private Employers

Pittsburgh, PA

Employment and Labor Alert

(by Janet Meub)

In case you haven’t noticed the yard signs popping up like mushrooms, the constant barrage of television and radio advertisements, or the unsolicited text messages from unknown numbers, we are in the homestretch of election season. For those employers with questions on how to handle political speech in the workplace, especially during the last few days before (and hopefully not much beyond) Election Day, here is a refresher on the basics for private employers.

The First Amendment to the U.S. Constitution prevents the government from enacting laws to prohibit the free exercise of speech and assembly, among other liberties. It does not apply to private employers. Where there is no state action involved, there is no unfettered right to free speech in a private place of employment. Quite simply, a private employer can enact rules to keep political expression from its workplace. Some employers prohibit political speech in the workplace to avoid potential disruptions to business operations, customer relations, or employee morale.

If an employer adopts a policy concerning political expression and messaging, it must do so  fairly and consistently, and it should be inclusive and consistent to avoid the perception of favoritism or discrimination. In other words, if an employer requires Meghan to remove her Kamala button, it should also direct Dennis not to wear his Trump t-shirt. Remote workers are still “in the workplace” when they participate in virtual meetings, so there are no separate rules for them.

When enacting rules about political expression and messaging in the workplace, private employers should of course remain aware of the National Labor Relations Act (NLRA), which applies to both union and non-union settings, and among other things protects employees’ ability to engage in concerted activity or to discuss the terms and conditions of their employment.

October 18, 2024

SAY “YES”: Reinventing Yourself in the Legal Profession

Pittsburgh, PA

The Legal Intelligencer

(by Janet Meub)

Clients come and go. There is no guarantee that you will keep the work. This is true for many reasons. You can win every trial and cost-effectively resolve every case for a client who will transfer the work to another firm or attorney willing to charge a lower billable rate. The claims examiner who directly assigns you cases leaves the insurance company or is replaced. The company’s new general counsel chooses to use her law school classmate for the transactional work you provided for years. Perhaps you do not reciprocate the inappropriate crush the assignor of work has on you (yes, this can happen to women in the law). The court rules in your client’s favor, eliminating 20 cases nationwide. A corporate client is sold or goes bankrupt. Or maybe the work stays (and stays…), and you want to leave! You will land new clients or land on your feet in a more supportive environment if you embrace the unfamiliar by saying “yes” to new work, experiences and opportunities.

******

I graduated from law school in 2001 and began working at a 15-attorney general practice firm in Youngstown, Ohio. My first “litigation” experience occurred the day after my swearing-in ceremony. A partner sent me to the Mahoning County Courthouse to take a debtor’s exam. I was nervous about my lack of experience, afraid to appear “green,” and uncomfortable asking the 60-some year-old debtor probing questions about his obviously precarious financial situation. Despite being asked out by the debtor and my pen leaking ink all over my face and new suit, I walked back to my office with confidence. However, my anxiety and discomfort in the face of new professional opportunities has never fully dissipated, and that’s okay.

October 17, 2024

Babst Calland Hosts Inaugural Client CLE Day at Acrisure Stadium

Pittsburgh, PA, Charleston, WV, Harrisburg, PA, and Washington, DC

Latest Developments In Policies, Laws and Regulations Shaping the Future of Business and Industry

On October 16, 2024, Babst Calland hosted its inaugural Client CLE Day at Acrisure Stadium. This full-day continuing legal education (CLE) program addressed the latest developments in policies, laws, and regulations shaping the future of business and industry. Topics included challenges facing in-house counsel, climate change litigation, the politics of energy law, ethical considerations for internal investigations, the end of the modern administrative state, and much more. In addition to offering high-quality CLE programming, the event featured tours of Acrisure Stadium and a tailgate-themed networking reception.

Below are the topics discussed in the various sessions throughout the day representing the legal and regulatory perspectives of Babst Calland attorneys across a wide spectrum of legal practice areas:

  • Appalachia Appeal: Pennsylvania and West Virginia Appellate Roundup
    This CLE presented by attorneys Casey Coyle, Michael Libuser, and Robert Stonestreet provided a survey of important, headline-grabbing Pennsylvania and West Virginia civil appellate cases decided within the last two years or currently pending before an appellate court in either state. The topics of the appeals included nuclear verdicts, jurisdiction, venue, forum non conveniens, arbitration, environmental law, liability, royalty, and damages.
  • Proactive Strategies to Prevent and Handle High-Stakes Environmental Litigation
    This experienced panel, comprised of Babst Calland corporate attorney Ben Clapp, consultant Kurt Herman of Gradient, and Babst Calland litigators Jim Corbelli and Christina McKinley discussed the various considerations that inform environmental litigation concerns, from their inception (e.g., contractual negotiations and drafting) to their conclusion (e.g., through trial and appeals).
July 27, 2024

Press Pause: SCOTUS Says an Appeal of Denied Request to Compel Arbitration Must Stay Case

Pittsburgh, PA

Pretrial Practice & Discovery

American Bar Association Litigation Section

(by Alexandra Graf)

Prior to the recently decided U.S. Supreme Court case Coinbase, Inc. v. Bielski, 216 L.Ed.2d 671 (2023)there was a circuit split as to whether an interlocutory appeal of a denied motion to compel arbitration forces the district court to stay the underlying proceedings. Pursuant to the Federal Arbitration Act, 9 U.S.C. § 16(a), “when a district court denies a party’s motion to compel arbitration, that party may make an interlocutory appeal.” This is a statutory exception to the typical rule that parties may not appeal before a final judgment is rendered. In a 5–4 decision, the Court held that the district court must stay its pretrial and trial proceedings while the interlocutory appeal on arbitrability is ongoing. This ruling incentivizes parties to enforce their arbitration clauses because a motion to compel arbitration is not shielded from appeal as other pretrial orders are, and the underlying matter will now be stayed until resolution of the appeal.

The U.S. Court of Appeals for the Fifth and Ninth Circuits previously held that whether the underlying district-court proceedings were stayed during an interlocutory appeal of this nature was a decision for the district court judge to make at their discretion. In the remaining circuits, the underlying case was automatically stayed upon an interlocutory appeal of a denied motion to compel arbitration. In resolving this circuit split, the Court relied on the Griggs rule, which is a longstanding concept of procedure that states that an appeal, including an interlocutory appeal, “divests the district courts of its control over those aspects of the case involved in the appeal.” Griggs v.

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