Baton v. Ledger SAS

Background

Plaintiffs are customers who bought Ledger SAS hardware wallets to protect cryptocurrency assets. In 2020, hackers accessed personal identifying information from Ledger’s customer database. The opinion states that the breach involved two TaskUs employees and a California man.

Plaintiffs sued Ledger, Shopify, and TaskUs. Shopify was Ledger’s subcontractor for website purchases, and TaskUs was Shopify’s subcontractor for customer-service operations. In earlier orders, the court dismissed Shopify based on Ledger’s forum-selection clause and later dismissed TaskUs after concluding that TaskUs could use that clause as an agent, sub-agent, or third-party vendor to the Ledger contract. The court also dismissed Plaintiffs’ California Consumer Legal Remedies Act claim and the fraudulent-prong claim under California’s Unfair Competition Law against Ledger. The remaining claim against Ledger was the Unfair Competition Law claim under its unjust and unlawful prongs.

Plaintiffs’ Motion

Plaintiffs moved under Federal Rule of Civil Procedure 54(b) for partial final judgment concerning the dismissals of Shopify and TaskUs and the dismissed California Consumer Legal Remedies Act claim against Ledger. Rule 54(b) can permit final judgment on fewer than all claims or parties in a case. Plaintiffs alternatively sought certification for an immediate, or interlocutory, appeal under 28 U.S.C. § 1292(b).

Forum-Selection-Clause Issue

The court explained that the Ninth Circuit had already held that Ledger’s forum-selection clause covered most claims arising from the purchase and use of Ledger wallets, while preserving certain California consumer-law claims against Ledger. The Ninth Circuit had not decided whether contractors and subcontractors such as Shopify and TaskUs, which did not sign Ledger’s contract, could use that clause.

The court found that question suitable for interlocutory appeal because it was a controlling legal question, there was substantial room for disagreement about the governing rule, and an immediate appeal could materially advance the litigation. If Shopify and TaskUs were improperly dismissed, the case might need to be retried with those defendants. If the Ninth Circuit agreed with the district court, the case could proceed against Ledger without that risk.

The court therefore certified its prior orders at Docket Nos. 148 and 167 for interlocutory appeal, but only as to whether Shopify and TaskUs may invoke Ledger’s forum-selection clause. Certification does not itself mean that the Ninth Circuit will accept the appeal; the statute gives that court discretion to do so.

Ledger’s California Consumer-Law Claim

The court denied certification concerning the dismissed California Consumer Legal Remedies Act claim. It found that Plaintiffs had failed to plead fraud under that claim adequately, even after multiple amended complaints, and found no substantial ground for disagreement about that conclusion.

The court also denied partial final judgment under Rule 54(b) for that claim because it substantially overlapped with the remaining Unfair Competition Law claim. Both claims arose from the TaskUs incident and centered on the allegation that Ledger failed to oversee TaskUs’s handling of customer data adequately.

Disposition

The court denied the motion for entry of partial final judgment under Rule 54(b). It granted certification under 28 U.S.C. § 1292(b) only on the question whether Shopify and TaskUs may use Ledger’s forum-selection clause. The court stayed the proceedings while the Ninth Circuit decides whether to accept the interlocutory appeal and ordered the parties to file a status report within one week after that decision.