Summary
applying "the rules of the American Arbitration Association" which were incorporated into an arbitration clause and concluding that they "provide for the arbitrator to determine arbitrability"
Summary of this case from Revis v. SchwartzOpinion
16512N 650166/14.
12-29-2015
In re the ARBITRATION OF CERTAIN CONTROVERSIES BETWEEN GRAMERCY ADVISORS LLC, et al., Petitioners–Respondents, v. J.A. GREEN DEVELOPMENT CORP., et al., Respondents–Appellants.
Neal M. Sher, New York, for appellants. O'Shea Partners LLP, New York (Michael E. Petrella of counsel), for respondents.
Neal M. Sher, New York, for appellants.
O'Shea Partners LLP, New York (Michael E. Petrella of counsel), for respondents.
Opinion
Order, Supreme Court, New York County (Marcy S. Friedman, J.), entered April 13, 2015, which, to the extent appealed from, granted the petition to compel arbitration, enjoined respondents from litigating their non-arbitrable claims in a related action pending in Texas (the Texas action) until the arbitration is resolved, and denied respondents' cross motion to stay the arbitration pending resolution of the Texas action, unanimously affirmed, with costs.
Supreme Court correctly declined to address respondents' arbitrability defenses. The arbitration provision at issue applies to “[a]ny controversy or claim arising out of or relating to any interpretation, breach or dispute concerning” the contract, and explicitly incorporates the rules of the American Arbitration Association, which provide for the arbitrator to determine arbitrability (see Life Receivables Trust v. Goshawk Syndicate 102 at Lloyd's, 66 A.D.3d 495, 496, 888 N.Y.S.2d 458 1st Dept.2009, affd. 14 N.Y.3d 850, 901 N.Y.S.2d 133, 927 N.E.2d 553 2010, cert. denied 562 U.S. 962, 131 S.Ct. 463, 178 L.Ed.2d 288 2010 ).
The court also correctly determined that petitioners did not waive their right to arbitration (see Thyssen, Inc. v. Calypso Shipping Corp., S.A., A.M., 310 F.3d 102, 105 2d Cir.2002, cert. denied 538 U.S. 922, 123 S.Ct. 1573, 155 L.Ed.2d 312 2003 ). A review of the record shows that, while the Texas action was filed in 2009, it was stayed for almost the entire period from its inception until shortly before the filing of the instant petition and that petitioners' sole involvement in the case was to file defensive actions by special appearance to contest personal jurisdiction. These actions, absent a showing of prejudice to respondents, are not sufficient to support a finding of waiver of petitioners' right to arbitrate (compare Thyssen, 310 F.3d 102 at 105–106 [no waiver despite filing answer]; Rush v. Oppenheimer & Co., 779 F.2d 885, 887 2d Cir.1985 [no waiver despite bringing a motion to dismiss and participating in “extensive discovery”]; In re Crysen/Montenay Energy Co. v. Shell Oil Co., 226 F.3d 160, 162–163 2d Cir.2000 [no waiver despite eight-year delay in taking interlocutory appeal from denial of motion to stay], cert. denied 532 U.S. 920, 121 S.Ct. 1356, 149 L.Ed.2d 286 2001 ).
The court properly enjoined the Texas action, which involves claims that are “ ‘inextricably interwoven’ ” with the issues to be determined in the arbitration (see PromoFone, Inc. v. PCC Mgt., 224 A.D.2d 259, 260, 637 N.Y.S.2d 405 1st Dept.1996; see also County Glass & Metal Installers, Inc. v. Pavarini McGovern, LLC, 65 A.D.3d 940, 885 N.Y.S.2d 288 1st Dept.2009 ). Contrary to respondents' contention based on the principles of comity, this Court has enjoined litigation in other states pending New York actions under CPLR 7503 (see e.g. PromoFone, 224 A.D.2d 259, 637 N.Y.S.2d 405; Matter of PricewaterhouseCoopers v. Rutlen, 284 A.D.2d 200, 726 N.Y.S.2d 258 1st Dept.2001 ).
We have considered respondents' remaining contentions and find them unavailing.