People of the State of California v. Express Scripts, Inc.

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

PEOPLE OF THE STATE OF No. 24-1972

CALIFORNIA, acting by and

D.C. No.

through Los Angeles County Counsel

2:23-cv-08570-

Dawyn R. Harrison,

SPG-PD

Plaintiff - Appellee,

ORDER

v.

EXPRESS SCRIPTS, INC.; ESI

MAIL PHARMACY SERVICE,

INC.; EXPRESS SCRIPTS

PHARMACY, INC.; OPTUMRX,

INC.,

Defendants - Appellants,

and

EXPRESS SCRIPTS

ADMINISTRATORS,

LLC, MEDCO HEALTH

SOLUTIONS,

INC., OPTUMINSIGHT,

INC., OPTUMINSIGHT LIFE

SCIENCES, INC.,

Defendants.

2 PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS

Appeal from the United States District Court

for the Central District of California

Sherilyn Peace Garnett, District Judge, Presiding

Argued and Submitted March 4, 2025

Pasadena, California

Filed June 2, 2025

Before: Mary H. Murguia, Chief Judge, and Gabriel P.

Sanchez and Holly A. Thomas, Circuit Judges.

SUMMARY *

Stay Pending Appeal

In an appeal from the district court’s order remanding a

removed action to state court, the panel affirmed the district

court’s denial of defendants’ motion to stay the remand order

pending appeal.

Defendants removed the action to federal court under the

federal officer removal statute. The district court granted

plaintiff’s motion to remand and denied defendants’ stay

motion. Declining to extend the logic of Coinbase, Inc. v.

Bielski, 599 U.S. 736 (2023), which held that interlocutory

appeals of denials of motions to compel arbitration result in

automatic stays of district court litigation, the panel clarified

that in this Circuit, the discretionary stay factors outlined in

*

This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS 3

Nken v. Holder, 556 U.S. 418 (2009), still control district

courts and motions panels reviewing motions to stay

litigation in the federal officer removal context. The panel

disagreed with the Fourth Circuit and agreed with other

Circuits. Applying the Nken factors, the panel held that the

district court did not abuse its discretion in denying a stay.

COUNSEL

Louis M. Bograd (argued), Elizabeth Smith, and Linda

Singer, Motley Rice LLC, Washington, D.C., for Plaintiff-

Appellee.

Christopher Michel (argued), Jonathan G. Cooper, and

Michael J. Lyle, Quinn Emanuel Urquhart & Sullivan LLP,

Washington, D.C.; Kiel Ireland and Sage V. Heuvel, Quinn

Emanuel Urquhart & Sullivan LLP, Los Angeles, California;

Charles B. Straut II, Quinn Emanuel Urquhart & Sullivan

LLP, San Francisco, California; Omar Morquecho and

Kimberly K. Chemerinsky, Alexander Akerman, Alston &

Bird LLP, Los Angeles, California; for Defendants-

Appellants.

4 PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS

ORDER

MURGUIA, Chief Circuit Judge:

Since the Supreme Court decided, in Coinbase, Inc. v.

Bielski, 599 U.S. 736 (2023), that interlocutory appeals of

denials of motions to compel arbitration result in automatic

stays of district court litigation, some uncertainty has arisen

as to whether that holding applies in other contexts.

Defendants here argue that Coinbase’s logic should extend

to the federal officer removal context and ask this Court to

issue an automatic stay of the district court’s order

remanding this case to state court “before deciding the merits

of this appeal.” 1 We accept Defendants’ call to address this

issue expeditiously and separately from the merits of their

appeal. Today we clarify that in this Circuit, the

discretionary stay factors outlined in Nken v. Holder, 556

U.S. 418, 434 (2009) still control district courts and motions

1

Defendants concede in their briefing that a motions panel of this Circuit

in a similar federal officer removal case immediately prior to

Defendants’ appeal denied a motion to stay litigation pending appeal and

cited to Nken v. Holder. See California v. CaremarkPCS Health LLC,

Nos. 23-55597, 23-55599 (9th Cir. Aug. 17, 2023) (order denying

motion to stay lower court proceedings). Accordingly, after the district

court denied Defendants’ motion to stay litigation pending appeal,

Defendants did not file a separate application for a stay pending appeal

in this Circuit. Instead, they asked this panel to “address this recurring

issue.” We do so in this order affirming the district court’s denial of stay

and will issue our disposition on the merits of whether Defendants’

removal pursuant to the federal officer removal statute was proper.

PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS 5

panels reviewing motions to stay litigation in the federal

officer removal context. 2

I.

This case involves a lawsuit brought originally in state

court by the Los Angeles County Counsel against

pharmaceutical-entity defendants Express Scripts, Inc.; ESI

Mail Pharmacy Service, Inc.; Express Scripts Pharmacy,

Inc.; and OptumRx, Inc. (“Defendants”). The People of the

State of California acting by and through Los Angeles

County Counsel (“Plaintiff” or “the People”) allege

Defendants should be held liable under California’s public

nuisance statute for contributing to the public nuisance of the

opioid epidemic through their prescription opioid business

practices. Defendants removed this case to federal court

under the federal officer removal statute on the theory that

their business involves contracts with the U.S. Department

of Defense, Department of Veterans Affairs, and Office of

2

All other circuits where this question has been raised, besides the

Fourth Circuit, appear to have reached the same conclusion. See Gov’t

of P.R. v. Express Scripts, 119 F.4th 174, 184 n.3 (1st Cir. 2024); Cnty.

of Westchester v. Express Scripts, Inc., No. 24-1639 (2d Cir. Sept. 6,

2024) (order denying motion to stay) (“[T]he request to stay is DENIED

because the Appellants are not entitled to an automatic stay pending

appeal under Coinbase.”); Georgia v. Clark, No. 23-13368, 2023 U.S.

App. LEXIS 34018, at *2 (11th Cir. Dec. 21, 2023) (“Coinbase was

limited to arbitration proceedings, which are not at issue here.”); see also

Plaquemines Par. v. Chevron United States, Inc., 84 F.4th 362, 373‒

78 (5th Cir. 2023) (applying the Nken factors in considering whether to

grant the plaintiffs’ motion to lift and vacate the district court’s stay order

pending appeal of its remand order in a federal officer removal case).

The Fourth Circuit appears to be the first and only circuit in the country

to have extended Coinbase’s logic to the federal officer removal context.

City of Martinsville, Virginia v. Express Scripts, Inc., 128 F.4th 265 (4th

Cir. 2025).

6 PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS

Personnel Management to fill prescriptions for health plan

members, including opioid medications. The federal officer

removal statute permits a person “acting under” a federal

officer to remove claims “for or relating to” the work for the

federal officer. 28 U.S.C § 1442(a)(1). Plaintiff moved to

remand and simultaneously amended its Complaint to

include a disclaimer expressly limiting the scope of its

claims to “Defendants’ conduct in the non-federal market.”

The district court granted the People’s motion to remand,

noting that the “explicit disclaimer” in the Amended

Complaint eviscerated Defendants’ ground for removal.

Defendants then appealed that decision pursuant to 28 U.S.C

§ 1447(d), which provides for interlocutory appeals of

remand orders based on lack of subject-matter jurisdiction

under the federal officer removal statute. DeFiore v. SOC

LLC, 85 F.4th 546, 554 (9th Cir. 2023). Defendants also

moved in the district court for a stay of the remand order

pending appeal. But the district court denied the motion

pursuant to Nken v. Holder, 556 U.S. 418 (2009) as opposed

to Coinbase, Inc. v. Bielski, 599 U.S. 736 (2023). 3 We

affirm the district court’s denial of Defendants’ motion to

stay.

II.

This Court reviews a district court’s stay order for abuse

of discretion. In re PG&E Corp. Sec. Litig., 100 F.4th 1076,

1083 (9th Cir. 2024).

3

The district court cited to Golden Gate Rest. Ass’n. v. City and Cnty. of

San Francisco, 512 F.3d 1112, 1115 (9th Cir. 2008), for the four stay

factors, but they are essentially identical to those the Supreme Court

articulated in Nken. See Nken, 556 U.S. at 434.

PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS 7

III.

In Coinbase, the Supreme Court held that a district court

is “require[d]” to enter an “automatic stay” pending appeal

when a party exercises its statutory right under 9 U.S.C.

§ 16(a) (“The Federal Arbitration Act” or “FAA”) to an

interlocutory appeal of the denial of a motion to compel

arbitration. 599 U.S. at 742–44. In so ruling, the Court

relied on Griggs v. Provident Consumer Discount Co.,

459 U.S. 56 (1982), which held that an “appeal, including an

interlocutory appeal, ‘divests the district court of its control

over those aspects of the case involved in the appeal.’” Id.

at 740 (quoting Griggs, 459 U.S. at 58). 4 Because the

question on appeal in the FAA context “is whether the case

belongs in arbitration or instead in the district court, the

entire case is essentially ‘involved in the appeal.’” Id. at

741 (quoting Griggs, 459 U.S. at 58). Accordingly, a stay of

lower court proceedings pending appeal is required when a

district court denies a motion to compel arbitration. Id.

Defendants argue that the Supreme Court’s reasoning in

Coinbase should be extended to automatically stay litigation

during the appeals of remand orders in the federal officer

removal context. Because the question on appeal is whether

the case belongs in federal or state court, Defendants argue

that the entire case is essentially involved in the appeal, and

therefore an automatic stay of all proceedings is warranted

4

Coinbase also turned in part on preserving for deserving defendants the

unique benefits of arbitration as opposed to litigation, which we will

discuss in more depth below. See 599 U.S. at 743.

8 PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS

under Coinbase’s application of the Griggs principle. We

disagree. 5

Coinbase read in conjunction with relevant Supreme

Court precedent counsels in favor of limiting the Coinbase

holding to the arbitration context. Federalism concerns––

namely the limited jurisdiction of federal courts and the need

to respect the jurisdiction of state courts––distinguish federal

officer removal from the arbitration context. Moreover, the

unique aspects of arbitration that automatic stays help to

preserve are not at issue in the federal officer removal

context. Finally, automatic stays of federal officer removal

appeals could lead to improper delay tactics and do harm to

principles of judicial efficiency. We therefore reaffirm that

Nken v. Holder provides the proper standard for determining

whether to issue a stay following the denial of a motion to

compel arbitration.

A.

The Coinbase majority clearly stated that “the sole

question before [the] Court [was] whether a district court

must stay its proceedings while the interlocutory appeal on

arbitrability is ongoing.” 599 U.S. at 740. The Supreme

Court did not receive briefing on the unique federalism

issues implicated by the federal officer removal statute that

differ in the arbitration context. Instead, the issues and

briefing presented concerned only stays in the context of

arbitration and the unique aspects of the Federal Arbitration

Act. Nearly every paragraph of the Coinbase opinion

5

Indeed, Defendants’ broad reading of Coinbase and the Griggs

principle would ostensibly sweep in other areas of litigation including,

for instance, interlocutory appeals of remand orders based on 28 U.S.C.

§ 1443 (the civil rights removal statute), though Coinbase made no

mention of other such areas.

PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS 9

specifically references “arbitrability” or the provisions of the

FAA.

Coinbase does not abrogate Nken v. Holder beyond the

arbitration context. While Coinbase represents a carveout to

the normal discretionary stay powers in the arbitration

context, the opinion does not overrule Nken nor render its

precepts inoperable in other contexts. Here, we abide by the

Supreme Court’s instruction to “follow the case which

directly controls” and “leav[e] to [the Supreme] Court the

prerogative of overruling its own decisions.” Agostini v.

Felton, 521 U.S. 203, 237 (1997) (quoting Rodriguez de

Quijas v. Shearson/Am. Express, Inc., 490 U.S. 477,

484 (1989)).

B.

Crucially, requiring an automatic stay in the federal

officer removal context would implicate federalism

concerns not at issue where parties seek to compel

arbitration. Nken emphasizes that a stay is an “intrusion into

the ordinary processes of administration and judicial review”

and accordingly “is not a matter of right, even if irreparable

injury might otherwise result.” 556 U.S. at 427 (quotations

omitted). Nken further held that a stay is an exercise of

judicial discretion, the propriety of which is dependent upon

the circumstances of a particular case. Id. The ability for

federal courts to weigh various factors before issuing the

extraordinary remedy of a stay is vital for the efficient

administration of justice, especially when the case involves

another sovereign: here, the State of California. See Cnty. of

San Mateo v. Chevron Corp., 32 F.4th 733, 764 (9th Cir.

2022).

The four discretionary stay factors courts must weigh

under Nken are “(1) whether the stay applicant has made a

10 PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS

strong showing that he is likely to succeed on the merits;

(2) whether the applicant will be irreparably injured absent a

stay; (3) whether issuance of the stay will substantially

injure the other parties interested in the proceeding; and

(4) where the public interest lies.” 556 U.S. at 434. The first

two factors are the most critical. Id.

This discretion makes sense in the federal officer

removal context because courts should have the power to

weigh these important factors before granting stays that

could infringe upon the rights of state courts. See Younger

v. Harris, 401 U.S. 37, 43 (1971). Improper removals based

on the federal officer removal statute deprive state courts of

jurisdiction over cases that should rightfully be heard in their

fora, in violation of comity principles. Automatic stays of

litigation based on those improper removals pursuant to

Coinbase would only exacerbate federal infringement on

state courts’ rights. Nken’s discretionary stay power allows

federal courts to “scrupulously confine their own

jurisdiction” and ensure they are giving “[d]ue regard for the

rightful independence of state governments.” Cnty. of San

Mateo, 32 F.4th at 764 (quoting Healy v. Ratta, 292 U.S.

263, 270 (1934)).

Just as Nken affords federal courts discretion, so too are

state courts empowered to craft case-specific solutions to

balance the interests at stake when they receive remanded

cases. For instance, a state court could decide to stay a

remanded case if, in its opinion, it thinks the defendants who

removed based on the federal officer removal statute do have

a strong likelihood of success on appeal. Coinbase’s

automatic stay rule applied to the federal officer removal

context would deprive state courts of the power to make

those types of determinations. Federal removal

jurisprudence should allow state courts to “actuate federal

PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS 11

courts,” which is what Nken’s discretionary stay factors

allow for here. Healy, 292 U.S. at 270.

Our federal and state court systems operate on the

bedrock principle of comity, which includes “a continuance

of the belief that the National Government will fare best if

the States and their institutions are left free to perform their

separate functions in their separate ways.” Younger,

401 U.S. at 44. The federal government “anxious though it

may be to vindicate and protect federal rights and federal

interest” must always “endeavor[] to do so in ways that will

not unduly interfere with the legitimate activities of the

States.” Id. Here, an automatic stay pending appeal of a

federal officer removal remand order would run afoul of the

delicate balance of federalism. The Supreme Court has

repeated “time and time again that the normal thing to do

when federal courts are asked to enjoin pending proceedings

in state courts is not to issue such injunctions.” Id. at 45. A

stay pending appeal raises concerns for state court

proceedings analogous to those at issue in Younger. See

Nken, 556 U.S. at 428 (“A stay pending appeal certainly has

some functional overlap with an injunction.”). This is why

Nken counsels that stays pending appeal are discretionary

and today we reaffirm that they should remain so in the

federal officer removal context. See id. at 427.

C.

That arbitration is a fundamentally different form of

dispute resolution than litigation further demonstrates why

Coinbase’s logic is inapposite in the federal officer removal

context. The FAA reflects a “liberal federal policy in

favoring arbitration” when parties validly contract for it.

Moses H. Cone Memorial Hosp. v. Mercury Constr. Corp.,

460 U.S. 1, 24 (1983). Thus, the Supreme Court has long

12 PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS

interpreted the FAA as an exceptional statute “designed to

promote arbitration . . . ‘notwithstanding any state

substantive or procedural policies to the contrary.’” AT&T

Mobility LLC v. Concepcion, 563 U.S. 333, 345–46 (2011)

(quoting Moses H. Cone, 460 U.S. at 24).

The federal officer removal statute, since its original

enactment near the end of the War of 1812, has undergone a

series of amendments. Watson v. Philip Morris Cos., 551

U.S. 142, 147–48 (2007). But its “basic purpose” remains

“to protect the Federal Government from the interference

with its operations that would ensue” if federal officers and

agents could be subject to trial and liability in potentially

hostile state courts based on actions “within the scope of

their authority.” DeFiore, 85 F.4th at 555 (cleaned up). The

statute thus “vindicates . . . the interests of [the federal]

government” in “preserving its own existence.” Id. at

553 (cleaned up).

Congress’s intent to promote arbitration via the FAA

“notwithstanding any state substantive or procedural

policies to the contrary,” Moses H. Cone, 460 U.S. at 24,

stands in contrast to the long-held principle that “removal

statutes should be construed narrowly in favor of remand to

protect the jurisdiction of state courts.” Harris v. Bankers

Life and Cas. Co., 425 F.3d 689, 698 (9th Cir. 2005). While

it is true that the federal officer removal statue should be

“liberally construed,” Watson, 551 U.S. at 147, that guidance

must be understood in the broader context of the United

States’ dual sovereign court system, where federal courts of

limited jurisdiction must “scrupulously confine their own

jurisdiction to the precise limits which the statute

[authorizing removal jurisdiction] has defined.” Healy,

292 U.S. at 270; see DeFiore, 85 F.4th at 553–54 (clarifying

that while the language of the federal officer removal statue

PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS 13

is broad and must be liberally construed, it “is not limitless”

(quoting Watson, 551 U.S. at 147)).

Coinbase highlights some of the fundamental

differences between arbitration and litigation, 599 U.S. at

743, which illustrate both that Coinbase is inapposite and

that an automatic stay rule is not warranted in the federal

officer removal context. The reason why parties may prefer

to arbitrate as opposed to litigate claims is due to “efficiency,

less expense, less intrusive discovery, and the like.” Id. The

continuation of proceedings in the district court when stays

are denied renders those features “irretrievably lost.” Id.

These unique features of arbitration also help explain

Coinbase’s contention that a denial of a motion to compel

arbitration makes it so “the entire case is essentially

‘involved in the appeal,’” necessitating an automatic stay of

litigation pending appeals of denials of arbitrability. Id. at

741 (quoting Griggs, 459 U.S. at 58). Absent an automatic

stay in the arbitration context, the benefits of arbitration

Congress aimed to effectuate via the FAA could be

irreparably lost with each day a party is wrongfully subjected

to pretrial litigation and discovery. Id. at 743.

These fundamental differences between arbitration and

litigation do not exist as between litigation in state versus

federal courts. Though state and federal courts may operate

in slightly different ways, each provide forums for litigation

with roughly similar levels of efficiency, expense, and

comprehensive discovery mechanisms. Having to continue

litigation in state court for a brief period pending appeal does

not cause defendants to “irretrievably lo[se]” any benefits of

14 PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS

the type lost when being wrongfully forced to arbitrate. 6 See

id. at 743.

It also bears noting that applying Nken, and not

Coinbase, to appeals of federal officer removal remand

orders such as the one here squares with Griggs because the

question on appeal here is essentially a narrow venue

question of whether the case belongs in state or federal court.

This question differs from questions remaining before the

state court (assuming the case gets remanded) such as

whether the claims have merit, whether the parties are

entitled to the discovery they seek, and so on. Proceedings

on those questions would not interfere with the appellate

court's review of the remand order, nor risk inconsistent

6

Indeed, the Supreme Court has historically understood the federal

officer removal statute as intending to shield federal officers from biased

trials in state court and accompanying judgments. See Watson, 551 U.S.

at 150. The long line of precedent stretching back over a century

interpreting the federal officer removal statute does not discuss the right

to avoid pretrial discovery in state court but instead focuses on providing

a federal forum for trials and final judgments for federal officers. Id. at

150–51. In one of the seminal cases first upholding the constitutionality

of an early iteration of the statue, the Supreme Court said the history of

the statute was “well known” and that “[i]t gives the right to remove at

any time before trial.” Tennessee v. Davis, 100 U.S. 257, 268 (1879)

(emphasis added). The main concern was a biased state court judge

presiding over an unfair trial in front of a hostile local jury reflecting

“local prejudice” against unpopular federal laws or federal officials. See

Watson, 551 U.S. at 150 (quoting Maryland v. Soper, 270 U.S. 9,

32 (1926)). Over time, the focus on shielding federal officers from

biased trials evolved to include giving “officers a federal forum in which

to litigate the merits of immunity defenses.” Jefferson Cnty. v. Acker,

527 U.S. 423, 447 (1999) (Scalia, J., concurring in part and dissenting in

part). But, having to go through some early stages of litigation in state

court does not deprive defendants wrongly remanded from later having

their immunity defenses decided in federal court if they are ultimately

permitted to remove.

PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS 15

judgments. Those proceedings, in other words, do not

implicate the Griggs principle, which addresses the “danger

a district court and a court of appeals would be

simultaneously analyzing the same judgment.” 459 U.S. at

59.

In sum, permitting early stage litigation in state court

would not preclude a defendant from returning to federal

court post-appeal. If removed, the defendant could then

have its federal immunity defenses adjudicated and, if

necessary, a trial held in federal court. See Watson, 551 U.S.

at 150–51. This system works, and we see no valid reason

to alter it. 7

D.

Finally, adopting an automatic stay rule in the federal

officer context might encourage gamesmanship by

defendants that would frustrate principles of judicial

7

Analogies to other contexts involving interlocutory appeals help to

further illustrate the distinct concerns raised in the federal officer

removal context. Appeals from denials of qualified immunity, absolute

immunity, sovereign immunity, and immunity under the Double

Jeopardy Clause all immediately divest the district court of jurisdiction

over the entire case against defendants because these immunities

represent an entitlement to avoid litigation altogether. Mitchell v.

Forsyth, 472 U.S. 511, 526 (1985). That entitlement extends even to

pretrial discovery. Harlow v. Fitzgerald, 457 U.S. 800, 818 (1982)

(“Until this threshold immunity question is resolved, discovery should

not be allowed.”). Courts have not understood the federal officer

removal statute, by contrast, to shield defendants from pre-trial litigation

in toto. See Watson, 551 U.S. at 150 (quoting Soper, 270 U.S. at 32);

Tennessee, 100 U.S. at 268. The statute instead aims to guarantee a

federal forum for adjudication of federal immunity defenses and trial on

the merits. See Jefferson Cnty. 527 U.S. at 447. Allowing some pretrial

litigation to continue on in state court pending federal interlocutory

appeal of the remand order does not ultimately frustrate this purpose.

16 PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS

economy. Any defendant seeking to delay discovery could

craft an argument for federal officer removal then appeal a

district court’s remand order. This could cause plaintiffs

languishing under mandatory stays to suffer harms in the

form of lost evidence, depleted funding, and diminished

patience.

Coinbase instructs that courts have tools to avoid such

gamesmanship in the arbitration context. But these proposed

solutions do not support judicial economy in the federal

officer removal context. First, the Supreme Court provides

that district courts may “certify that an interlocutory appeal

is frivolous.” Coinbase, 599 U.S. at 754 (citing Arthur

Andersen LLP v. Carlisle, 556 U.S. 624, 629 (2009)). While

district courts have the power to certify the question of

whether an interlocutory appeal is frivolous, they seldom

seem to use it because they have the discretion to simply

assess the Nken factors before deciding whether to grant a

stay. Sanctions provide another option to punish frivolous

appeals, see Fed. R. App. P. 38; Arthur Andersen, 556 U.S.

at 629, but they are cumbersome for courts to impose and

rarely used. Accordingly, the discretionary stay system

already in place is superior for the purposes of judicial

economy.

IV.

The district court did not abuse its discretion in applying

the Nken factors to deny Defendants’ motion to stay the

litigation pending appeal. 8 The district court found that

8

The Ninth Circuit’s application of the Nken factors operates on a

“sliding scale,” such that “if there is a probability or strong likelihood of

success on the merits, a relatively low standard of hardship is sufficient.”

PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS 17

Defendants did not make a strong showing that they were

likely to succeed on the merits in large part because

Plaintiff’s valid and comprehensive disclaimer eviscerated

all basis for federal officer removal jurisdiction. A court of

appeals assessing the likelihood of success on the merits for

the purposes of a stay pending appeal must take care “not to

prejudge the merits of the appeal” and need not “address the

merits in detail.” Doe #1 v. Trump, 957 F.3d 1050, 1062 (9th

Cir. 2020).

Here, Plaintiff’s disclaimer appears to sever all federal

involvement from Plaintiff’s state law public nuisance claim

so as to make it impossible for Defendants to satisfy the

elements of the federal officer removal statute––that the

entity seeking removal is (a) a person within the meaning of

the statute; (b) there is a causal nexus between its actions,

taken pursuant to a federal officer’s directions, and

plaintiff’s claims; and (c) it can assert a colorable federal

defense. Goncalves ex rel. Goncalves v. Rady Child.’s Hosp.

San Diego, 865 F.3d 1237, 1244 (9th Cir. 2017) (internal

citations omitted). 9 Defendants have not addressed any

hardship that would be cognizable under Nken nor injury to

others that would occur in the absence of a stay. Finally, the

district court agreed with Plaintiff that the public interest

favored continuing with the litigation to abate an ongoing

public health crisis to which Defendants are alleged to have

contributed. Defendants did not, at this stage in the

Golden Gate, 512 F.3d at 1116–19 (internal quotations and citations

omitted). By contrast, “if the balance of hardships tips sharply in favor

of the party seeking the stay, a relatively low standard of likelihood of

success on the merits is sufficient.” Id. at 1119 (cleaned up).

9

Our forthcoming opinion will discuss the merits of Defendants’ federal

officer removal arguments and the viability of Plaintiff’s disclaimer in

greater depth.

18 PEOPLE OF THE STATE OF CALIFORNIA V. EXPRESS SCRIPTS

litigation, attempt to counter Plaintiffs’ arguments based on

Nken. Accordingly, the district court did not abuse its

discretion in denying Defendants’ motion for a stay pending

appeal. Nken, 556 U.S. at 434; In re PG&E Corp., 100 F.4th

at 1083.

* * *

Defendants asked this Court to rule first and as quickly

as possible on their request to stay the lower court

proceedings pending review of their federal officer removal

arguments. Having done so, we affirm that Nken, and not

Coinbase, provides the proper standard for assessing

Defendants’ request for a stay of the state court proceedings.

“[T]he Supreme Court’s decision in Coinbase does not

constitute a general withdrawal of the discretion that courts

have exercised for centuries—rather, it merely represents a

carve-out in favor of arbitration.” City of Martinsville,

Virginia v. Express Scripts, Inc., 128 F.4th 265, 275 (4th Cir.

2025) (Wynn, J., dissenting). We agree. Accordingly, we

affirm the district court’s denial of the motion to stay.

AFFIRMED.