In Shirodkar v. Coinbase Global, Inc., 2025 ONCA 298, the appellant Shantanu Shirodkar sought to lead a class action against Coinbase Global and its subsidiaries for alleged violations of the Securities Act and “failing to meet statutorily mandated disclosure and registration requirements for security dealers.”
The proposed class was everyone in Canada who entered into crypto rights contracts or transacted in tokens with the respondents between Oct. 8, 2019, and the certification date. The action was dismissed on jurisdictional grounds, with the lower court finding it had no jurisdiction on claims asserted against non-Canadian respondents.
It concluded that Ireland was the preferable forum for the claim. The action against the Canadian respondent was stayed. The appellate court found that the motion judge correctly interpreted a forum clause in Coinbase Canada’s user agreement.
The appellant purchased and sold cryptocurrency assets through the respondent between October 2017 and January 2021, executing three user agreements with various Coinbase entities in 2017 and 2020, namely Ireland and Europe, stating that the agreement was governed non-exclusively by Irish laws and was under the jurisdiction of Irish courts.
The appellant did not execute the initial version of the Coinbase Canada user agreement but did so after the respondents served their motion to stay or dismiss. He accepted the updated version of the user agreement providing a non-exclusive choice of forum favouring Ontario. The motion judge found that the non-Canadian respondents did not carry on business in Ontario.
“Although the Canadian User Agreement operated retroactively, the motion judge concluded that it bound only the users who accepted it and Coinbase Canada,” the appellate court wrote. “She rejected the appellant’s argument that the non-Canadian respondents had attorned to the jurisdiction of Ontario courts through their dealings with Canadian regulators.”
The Canadian user agreement was not found to be applicable to prior disputes that a Canadian user might have against another Coinbase company, nor did it retroactively confer jurisdiction to Ontario courts over historic claims against non-parties to the agreement — the only parties to the agreement being users and Coinbase Canada.
“Had Coinbase Canada intended to bind other Coinbase companies to the dispute resolution provision in the Agreement, s. 10.4 would refer to disputes between its users and the Coinbase Group,” the appellate court wrote.
The appellant argued that Coinbase Europe, which was a party to two of the agreements, waived the right to raise a jurisdictional objection by recognizing that consumers could advance claims in local courts.
“It cannot reasonably be inferred that, when it entered into the Second and Third Agreements in 2020, Coinbase Europe anticipated the creation of an agreement between users and Coinbase Canada in 2023 and agreed to be bound by the choice of forum and choice of law terms in it,” the court wrote.
The court noted that the appellant’s purchase took place in Ireland via Coinbase Europe, the contractual relationship was formed in Ireland, the trade was executed outside of Ontario, the servers were located outside of Ontario, the appellant accessed the Coinbase platform in France and later in Ontario and suffered alleged damages in Ontario.
The motion judge did not find a real and substantial connection as none of the non-Canadian respondents was carrying on business in Ontario. She found that a plaintiff suffering damages in Ontario did not constitute a presumptive connecting factor.
The appellate court found that it was open to her to find that “access to a global internet platform from Canada is, at best, a weak presumptive connecting factor, which the respondents had rebutted.” She also correctly found that the appellant’s “assertion of a cause of action under an Ontario statute does not automatically mean that an Ontario court has jurisdiction over the claim.”
The panel further noted the motion judge’s finding that the activities of the non-Canadian respondents were “not enmeshed with those of Coinbase Canada, and sorting their roles would not be akin to ‘trying to unscramble an egg.’”
The lower court concluded, and the appellate court agreed, that since Coinbase Canada was not involved in the transactions that gave rise to the claims, “allowing the claim against it to proceed in Ontario while claims against the other defendants would have to be adjudicated elsewhere would risk wasting judicial resources and producing conflicting decisions.”
The motion judge had accepted the respondents’ expert evidence on the suitability of Irish courts for the claim. While Ireland has no class action legislation, the lower court concluded that Ireland was still the preferable forum and stayed the action. As well, it was found that if the appellant sued the respondent in Ireland, it would accept jurisdiction over Coinbase Europe and any other Coinbase respondents who were proper parties.
The appellate court did not find that the motion judge “erred in principle, misapprehended or failed to take account of material evidence, or reached an unreasonable decision.” It noted again that the appellant traded through Coinbase Europe and none of the associated activities occurred in Ontario, except for access on a home computer. The appellant did not make a transaction on Coinbase when Coinbase Canada was a counterparty to the user agreement.
The appeal was dismissed by Justices Sally Gomery, Grant Huscroft and Patrick Monahan, with costs of $50,000 to the respondents.
Counsel for the appellant were Peter Jervis, Golnaz Nayerahmadi and Douglas Worndl of Rochon Genova.
Counsel for the respondents were Robert Staley, Cheryl Woodin, Douglas Fenton and Marshall Torgov of Bennett Jones LLP.
They were not immediately available for comment.
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