United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

MATTHEW C. KILGORE, et al., 

Plaintiffs,

v.

KEYBANK, NATIONAL

ASSOCIATION, et al., 

Defendants.

NO. C08-2958 TEH

ORDER FOR SUPPLEMENTAL

BRIEFING ON DEFENDANTS’

MOTION TO DISMISS

The Court is in receipt of Defendants’ Motion to Dismiss Plaintiffs’ Third Amended

Complaint and all subsequent briefing on the motion, which is noticed for hearing on

March 29, 2010. Defendants urge the Court to dismiss this action based on a forum selection

clause that requires any suit to be venued in Ohio and governed by Ohio law. The parties

agree that enforcement of the forum selection clause is governed by M/S Bremen v. Zapata

Off-Shore Co., in which the Supreme Court concluded that a “contractual choice-of-forum

clause should be held unenforceable if enforcement would contravene a strong public policy

of the forum in which suit is brought, whether declared by statute or by judicial decision.” 

407 U.S. 1, 15 (1972). Plaintiffs argue that California’s policy barring arbitration of

injunctive relief claims in consumer class actions meets that standard, a conclusion they

claim this Court already reached in its Order Denying Motion to Compel Arbitration

(Doc. 81).

Defendants’ appeal of that order is currently pending before the Ninth Circuit. As a

general rule, “the filing of a notice of appeal divests the district court of jurisdiction and

transfers jurisdiction to the appellate court.” Britton v. Co-op Banking Group, 916 F.2d

1405, 1412 (9th Cir. 1990). However, “an appeal seeking review of collateral orders does

not deprive the trial court of jurisdiction over other proceedings in the case, and an appeal of

an interlocutory order does not ordinarily deprive the district court of jurisdiction except with

Case 3:08-cv-02958-TEH Document 140 Filed 03/09/10 Page 1 of 2
United States District Court

For the Northern District of California

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regard to the matters that are the subject of the appeal.” Id. Where “the issue of arbitrability

[is] the only substantive issue presented in [an] appeal, the district court [is] not divested of

jurisdiction to proceed with the case on the merits.” Id.

Defendants’ appeal in this case questions whether this Court erred “in holding that

California law barred the arbitration of a private contractual dispute where injunctive relief is

sought.” Appellants’ Opening Br. at 1. This appears to be identical to one of Plaintiffs’

central arguments in opposition to the motion to dismiss – that California has a strong public

policy barring arbitration of injunctive relief claims in consumer class actions. Although the

parties have not questioned this Court’s jurisdiction over the pending motion, the Court

raises this question sua sponte in light of the apparent identity of issues.

Therefore, with good cause appearing, IT IS HEREBY ORDERED that Plaintiffs and

Defendants shall each file supplemental briefs, on or before March 15, 2010, addressing

whether this Court can and should rule on Defendants’ motion to dismiss before the Ninth

Circuit decides Defendants’ pending appeal. Each brief shall not exceed five pages. The

parties shall be prepared to address the jurisdictional question, in addition to all other

arguments related to Defendants’ motion to dismiss, at the March 29, 2010 hearing.

IT IS SO ORDERED.

Dated: 3/9/10 

THELTON E. HENDERSON, JUDGE

UNITED STATES DISTRICT COURT

Case 3:08-cv-02958-TEH Document 140 Filed 03/09/10 Page 2 of 2