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No Pause in ERISA Class Suit for Supreme Court Appeal


August 4, 2023

A proposed class action alleging a radiology company and its founders overcharged an employee stock ownership plan can move forward, a Colorado federal judge has ruled, saying the defendants aren’t entitled to a stay while they appeal to the U.S. Supreme Court over an order that found federal benefits law trumped the company’s arbitration agreement.

The Envision Management Holding Inc. board of directors, along with other defendants, argued that the U.S. Supreme Court’s decision in Coinbase Inc. v. Bielski   means they’re entitled to a stay while at least one of them appeals a Tenth Circuit decision upholding the conclusion that an arbitration provision tucked in Envision workers’ employee stock ownership plan documents impermissibly blocked remedies under the Employee Retirement Income Security Act.

But U.S. Magistrate Judge Maritza Dominguez Braswell disagreed in her order Thursday, seeing no need to reinstate the stay she lifted in May.

The judge noted that the plaintiffs didn’t challenge the idea that the Coinbase decision allowed for an automatic stay during an appeal to the Tenth Circuit court, but argued that the decision doesn’t also provide for automatic stays for petitions to the U.S. Supreme Court after an unsuccessful appeal.

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Michelle C. Yau of Cohen Milstein Sellers & Toll PLLC, who represents the proposed class, said in an email to Law360 on Friday, “we are glad to see the court reject defendants’ attempt to delay this case further. Our clients are eager to prove their claims.”

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The plaintiffs are represented by Michelle C. Yau, Ryan Wheeler, Kai H. Richter and Caroline E. Bressman of Cohen Milstein Sellers & Toll PLLC.

Read No Pause in ERISA Class Suit for Supreme Court Appeal.