Opinion
CASE NO. C19-199RBL
09-12-2019
MANASA THIMMEGOWDA, Plaintiff, v. BIG FISH GAMES INC, et al., Defendants.
ORDER
THIS MATTER is before the Court on Defendant's Motion to Stay Discovery [Dkt. # 43] pending a ruling on its motion to compel arbitration [Dkt. # 33]. Defendants ask the Court to stay all discovery until rules on Defendants' Motion to Compel arbitration. Three Defendants—Aristocrat Leisure (an Australian corporation), Aristocrat Technologies (a Nevada corporation) and Churchill Downs Inc. (a Kentucky corporation)—have also moved to dismiss for lack of personal jurisdiction. [Dkt. # 35].
Thimmegowda concedes that substantive discovery should await the Court's arbitration decision but argues that there is no reason to delay limited discovery into the jurisdictional defense, in the meantime.
Notwithstanding the jurisdictional motion, the primary issue in this case (and in the related Kater case, and in several similar pending "gaming application" cases), is whether the plaintiff's claims must be arbitrated under the TOU. Defendants ask the Court to resolve their right to compel arbitration before subjecting them to any discovery.
This case is related to Kater v Churchill Downs, et al., Cause No. 15-612RBL, which covers an earlier time frame. Both cases relate to the Big Fish Casino gaming application. In Kater, this Court held that Churchill Downs had waived its right to require Kater to arbitrate. There is a similar pending motion to compel arbitration of the plaintiffs' amended claims in Kater.
The parties agree that the stay issue is addressed to the Court's discretion. See, for example, Butcher's Union Local No. 498 v. SDC Inv., Inc., 788 F.2d 535, 540 (9th Cir. 1986).
The underlying arbitrability issue will be informed by the result of two (or three) similar cases now on appeal in the Ninth Circuit. See Wilson v. Huuuge, Cause No. 18-cv-5276RBL, and Benson v. Double Down Interactive LLC, et.al., Cause No. 18-cv-0525RBL. Wilson was recently argued, and Double Down will be argued November 5. The Ninth Circuit stayed an interlocutory appeal in a third case, Wilson v Playtika, Cause No. 18-5277RBL, until its decision in Huuuge. See Court of Appeals Dkt. # 9 in Playtika. Each case, like this one, involves the enforceability of arbitration clauses in an application's or game's TOUs.
The Motion to Compel in this case (like the one in Kater) was recently re-noted for October 11. The Court presumes that these motions were re-noted so that the Ninth Circuit's opinion in Huuuge will issue before the Court rules on them.
The Court recognizes that the Defendants have raised a new arbitrability argument in this case: actual or imputed notice of the TOUs, on top of the constructive notice at issue in the appealed orders. Actual notice was not fully addressed in the prior cases. Thus, the Huuuge opinion will not necessarily inform the resolution of the motion in this case. Nevertheless, the Ninth Circuit's opinions in the related appeals obviously may impact the arbitrability issues in this case.
For that reason, the Court will STAY all discovery in this case, and the pending motion to compel arbitration, until 30 days after the Ninth Circuit's resolution of (at least) Huuuge. The Court anticipates that the Double Down and Playtika decisions will follow within a few months, but we can re-visit the potential impact of those decisions after Huuuge.
The Court is inclined to await a decision in all three appeals, and hereby solicits the parties' input on the status of this stay—should the case remain stayed, pending opinions in Double Down and Playtika?—within 10 days of the Huuuge opinion. --------
Meanwhile, the Motion to Stay discovery [Dkt. # 43] is GRANTED and this case is STAYED pending the Ninth Circuit's decision in Huuuge, or further order of the Court. The pending Motions [Dkt. #s 33 and 35] are TERMINATED without resolution and they can be re-noted (or revised and re-filed) when the stay is lifted.
IT IS SO ORDERED.
Dated this 12th day of September, 2019.
/s/_________
Ronald B. Leighton
United States District Judge