In an intriguing legal turn of events, the United States Supreme Court has agreed to take on a lawsuit concerning a Dogecoin sweepstakes involving Coinbase and its customers. This decision comes almost a year after the US District Court for the Northern District of California initially rejected Coinbase’s motion to move the class-action lawsuit to arbitration.

The class-action lawsuit, filed in 2021, alleged that Coinbase intentionally concealed from its customers the fact that they could enter the “Trade Doge, Win Doge” giveaway without having to trade $100 worth of the meme coin on their platform. The largest US-based crypto exchange was accused of deliberately hiding a free entry option via mail-in to spur trading volume and liquidity for Dogecoin, which was a newly listed asset at the time.

Coinbase had sought to compel the case into private arbitration, citing an arbitration clause in its user sign-up agreement. However, the federal judge ruled that the sweepstakes agreement, which prioritizes courtroom litigation as the dispute resolution method, overruled the sign-up contract.

In a significant victory for the plaintiff, on Friday, November 3, a federal judge in California, supported by the 9th U.S. Circuit Court of Appeals, upheld the decision that the prior sweepstakes agreement, which mandated resolution in a traditional courtroom setting, should take precedence.

The lead plaintiff in the class action, Coinbase user David Suski, alleges that he would not have paid $100 to participate in the Dogecoin giveaway had Coinbase disclosed the existence of the free entry option. The lawsuit seeks damages exceeding $5 million for sweepstakes participants who paid the entry fee.

David J. Harris, counsel for David Suski, expressed optimism that the court, like the previous judges involved, will hold Coinbase accountable based on the clear language of its contracts with consumers.

The Supreme Court’s decision to review this case represents a pivotal moment in the cryptocurrency legal landscape. It assumes even greater significance considering that major companies often prefer arbitration, given its lower costs and quicker resolution times compared to traditional courtroom litigation.

Coinbase is also embroiled in another notable legal battle with the United States Securities and Exchange Commission (SEC) over alleged violations of securities laws. In June, the regulatory body charged the crypto company with conducting an unregistered offering of certain crypto assets categorized as securities.

In its most recent court filing, Coinbase argued that the SEC is overstepping its authority, asserting that its definition of what constitutes a security is overly broad. These developments occur as Coinbase seeks to have the financial regulator’s lawsuit dismissed.

It remains to be seen how the Supreme Court’s review of the Dogecoin sweepstakes lawsuit will impact the outcome and set precedents within the realm of cryptocurrency-related legal disputes. The eyes of the crypto community are undoubtedly fixed upon this case, as it has the potential to shape the legal landscape for years to come.

Disclaimer: The information provided in this research report is for informational purposes only and should not be interpreted as financial or investment advice. The NFT and cryptocurrency market is highly volatile, and readers should conduct thorough research before making any investment decisions.