diff --git a/compiler/src/dotty/tools/dotc/core/TypeComparer.scala b/compiler/src/dotty/tools/dotc/core/TypeComparer.scala
index e6fbd1019c84..f52570b9bd82 100644
--- a/compiler/src/dotty/tools/dotc/core/TypeComparer.scala
+++ b/compiler/src/dotty/tools/dotc/core/TypeComparer.scala
@@ -1239,7 +1239,11 @@ class TypeComparer(initctx: Context) extends ConstraintHandling[AbsentContext] w
             if (leftRoot.isStable || (ctx.isAfterTyper || ctx.mode.is(Mode.TypevarsMissContext))
                 && leftRoot.member(tparam.name).exists) {
               val captured = TypeRef(leftRoot, tparam)
-              isSubArg(captured, arg2)
+              try isSubArg(captured, arg2)
+              catch case ex: TypeError =>
+                // The captured reference could be illegal and cause a
+                // TypeError to be thrown in argDenot
+                false
             }
             else if (v > 0)
               isSubType(paramBounds(tparam).hi, arg2)
diff --git a/tests/pos/i8319.scala b/tests/pos/i8319.scala
new file mode 100644
index 000000000000..d08ba85e7115
--- /dev/null
+++ b/tests/pos/i8319.scala
@@ -0,0 +1,14 @@
+package example
+
+sealed abstract class Tree[T]
+case class Lam[T,U]() extends Tree[Any]
+case class App[T,U]() extends Tree[Any]
+case class Var()      extends Tree[Any]
+
+object Branch:
+  def unapply(branch: Lam[?,?] | App[?,?]): true = true
+
+private def foo(s: Option[Tree[?]]) = s match // seems to only occur in a nested pattern
+  case Some(_: Var)   => true // must come first
+  case Some(Branch()) => true // must be unapply and not direct type check
+  case _              => false
\ No newline at end of file