Garthon Business Inc., et al., Respondents,v.Kirill Ace Stein, et al., Appellants.BriefN.Y.September 12, 2017To Be Argued By: JASON A. GROSSMAN Time Requested 30 Mirrutes APL-2016-00097 New York County Clerk's Index No. 653715/14 Olnurt nf J\pp.eals STATE OF NEW YORK ..... GARTHON BUSINESS INC. and CRESTGUARD LIMITED, Plaintiffs-Respondents, -against- KIRILL ACE STEIN and AURDELEY ENTERPRISES LIMITED, Defendants-Appellants. REPLY BRIEF FOR DEFENDANT-APPELLANT KIRILL ACE STEIN December 22, 2016 JASON A. GROSSMAN GADDI GOREN TUREK ROTH GROSSMAN LLP 377 Fifth Avenue, 6th Floor New York, New York 10016 Telephone: (212) 223-3562 Facsimile: (212) 2 23-3614 Attorneys for Defendant-Appellant Kirill Ace Stein TABLE OF CONTENTS TABLE OF AUTHORITIES………………………………………………..…...iii-v PRELIMINARY STATEMENT…………………………………………………...1 A. Stein is Not a New York Domiciliary……………………………………5 B. Aurdeley is Not Stein’s Alter Ego………………………………………..6 C. London is the Appropriate Forum to Arbitrate All Disputes Between the Parties…………………………………………………………………….9 LEGAL ARGUMENT……………………………………………………………...9 I. AN ARBITRATOR MUST DECIDE THE GATEWAY ISSUE OF ARBITRABILITY……………………………………………………….9 A. Plaintiffs-Respondents Artificially Elevate the Standard of Review……................................................................................................9 B. The Gateway Issue of Arbitrability Belongs to an Arbitrator……………10 (i) Plaintiffs-Respondents’ Reliance on Federal Case Law is Misplaced………………………………………………………...12 II. THE FORUM SELECTION CLAUSE IN THE QUENNINGTON AGREEMENT WAS TERMINATED………………………………….13 A. The Dispute Over the Temination of the Forum Selection Clause in the Quennington Agreement Must be Arbitrated Pursuant to the Express Terms of the Termination Agreement…………………………………...13 B. Plaintiffs-Respondents Confuse and Misconstrue “Clear Manifestation” to Require “Express Manifestation”……………………………………….14 i (i) The Parties to the Termination Agreement and Agreement 4 Expressed a “Clear Manifestation” to Terminate the Forum Selection Clause in the Quennington Agreement………………...17 C. Plaintiffs-Respondents Mistakenly Contend that the Release in the Termination Agreement is Limited Only to Payments Under the Quennington Agreement………………………………………………..19 D. Agreement 4 is Not a Continuation of the Quennington Agreement…….19 E. The Parties Did Not Intend for Claims Relating to Their “Legal Relationship” to be Adjudicated Differently Than Other Claims………..21 III. EVEN IF THE MAJORITY HAD THE AUTHORITY TO INTERPRET AGREEMENT 4 AND THE TERMINATION AGREEMENT, IT SHOULD HAVE APPLIED ENGLISH LAW………………………….23 A. Stein is Not Raising the Applicability of English Law for the First Time on Appeal…………………………………………………………………..23 B. English Law Governs All Substantive Issues Arising Under Agreement 4 and the Termination Agreement……………………………………...…24 C. Plaintiffs-Respondents’ Reliance on New York Law Lends Support to Stein’s Position that the Instant Action be Arbitrated in London………..25 D. Fiona Trust Applies to Agreement 4 and the Termination Agreement…..28 IV. PUBLIC POLICY MANDATES THAT THE DISPUTE CONCERNING THE TERMINATION OF THE FORUM SELECTION CLAUSE IN THE QUENNINGTON AGREEMENT BE ARBITRATED IN LONDON……………………………………………………………….30 CONCLUSION…………………………………………………………………...31 ii TABLE OF AUTHORITIES CASE LAW Applied Energetics, Inc. v. New Oak Capital Markets, LLC 645 F.3d 522, 524 (2d Cir. 2011)……………………..................................16 Brooke Group Ltd. v. JCH Syndicate 488 87 N.Y.2d 530, 533 (1996)……………………………………………...25-26 Dow Kim v. Dukon 89 A.D.3d 470, 471 (1st Dep’t 2011)………………………………………..11 Egiazaryan v. OJSC OEk Finance [2015] EWHC 3532 (Comm)…………………………………………....…28 Emmott v. Michael Wilson (No. 2) [2009] EWHC 1 (Comm)…………………......................................………28 Fili Shipping Co. Ltd. v. Premium Nafta Prods. Ltd. (“Fiona Trust”) (2007) UKHL 40……………………………………………………….28 - 29 Gen. Motors Corp. v. Fiat S.p.A. 678 F. Supp.2d 141 (S. D. N. Y., 2009)…………………………………12-13 Getty Petroleum Marketing Inc. v. 1314 Sedgwick Ave. LLC 106 A.D.3d 429 (1st Dep’t 2013)…………………………………..………..18 Gibson v. Seabury Transp. Advisor LLC 91 A.D.3d 465, 465 (1st Dep’t 2012)…..........................................................11 Goldman, Sachs & Co. v. Golden Empire Schools Fin. Auth. 764 F.3d 210, 216 (2d Cir. 2014)…………………………………... …...….16 Icdas Celik Enerji Tersane Ve Ulasim Sanayi A.S. v. Travelers Ins. Co. 81 A.D.3d 481, 483 (1st Dep’t 2011)……………………………... ……….11 iii Life Receivables Trust v. Goshawk Syndicate 102 at Lloyd’s 66 A.D.3d 495, 496 (1st Dep’t 2009), aff’d 14 N.Y.3d 850 (2010), cert denied 562 U.S. 962 (2010)………………… …………………………………10, 11 Mariano v. Town of Orchard Park 92 A.D.3d 1232 (4th Dep’t 2012)……………………………………………25 Matter of Schlaifer 51 N.Y.2d 181 (1980)……………………………. …………………….15-16 Matter of Minkin 279 A.D. 226 (2d Dep’t 1951)…………………………..........................15-16 Matter of Smith Barney Shearson v. Sacharow 91 N.Y.2d 39, 47 (1997)……………………………………………………11 Monde Petroleum SA v. Westernzagros Ltd [2015] EWHC 67 (Comm)………………………............ …………………29 New York Trans Harbor LLC v. Derecktor, Inc. 19 Misc.3d 11349(A) at *2-3, 862 N.Y.S.2d 908 (Sup. Ct. Kings Co. May 19, 2008)…………………………………………………………24 - 25, 26, 27 Pictet Funds (Europe) S.A. v. Emerging Managers Group, L.P. 2014 WL 6766011 (S. D. N. Y., December 1, 2014)………………...….12-13 Primex Intl. Corp. v. Wal-Mart Stores 89 N.Y.2d 594 (1997)……………………………………………….......14-15 Sebastian Holdings Inc. v. Deutsche Bank AG [2010] EWCA (Civ) 998……………………………………………………29 Steigerwald v. Dean Witter Reynolds 84 A.D.2d 905, 906 (4th Dep’t 1981), aff’d 56 N.Y.2d 621 (1982)……..…...22 iv USA-India Export-Import, Inc. v. Coca-Cola Refreshments USA, Inc. 46 Misc.3d 1215(A), 9 N.Y.S.3d 596 (Sup. Ct. Westchester Co. Jan. 30, 2015)………………………………………………………………..…..26, 27 Zachariou v. Manios 68 A.D.3d 539, 539 (1st Dep’t 2009)…………………………………....….11 SECONDARY SOURCES Brief for Defendant-Respondent Kirill Ace Stein 2015 WL 11077900 (1st Dep’t 2015)…………………………......……23 - 24 3rd Pocket Edition, 2006, Garner, Bryan…………………………………………...25 v Stein respectfully submits this reply brief in further support of his appeal from the Appellate Division Order.1 As discussed herein, the Appellate Division Order should be reversed in its entirety because it decided the gateway issue of arbitrability, and stripped Stein of his duly bargained for contractual right to arbitrate “any dispute arising out of or in connection with” the Termination Agreement. PRELIMINARY STATEMENT As delineated in Stein’s opening brief, this appeal turns on the simple and straightforward question of whether the forum selection clause in the Quennington Agreement or the arbitration clauses in Agreement 4 and the Termination Agreement govern the issue of arbitrability of Plaintiffs-Respondents’ claims. Plaintiffs- Respondents’ ruse that the forum selection clause in the Quennington Agreement is broader than the arbitration clause in Agreement 4 and the Termination Agreement since it applies to the “parties’ legal relationship” (and thus somehow to the issue of who gets to decide arbitrability) is not only wrong and misplaced, but irrelevant for disposition of this appeal. (See Plaintiffs-Respondents’ Brief, dated December 8, 2016 (“Plaintiffs-Respondents’ Brief”) at p. 15.) Specifically, the express terms of Agreement 4 and the Termination Agreement require an arbitrator to adjudicate the gateway issue of arbitrability. As 1 Unless otherwise defined herein, all capitalized terms shall have the same meaning as defined in the Brief for Defendant-Appellant Kirill Ace Stein, dated November 14, 2016 (“Stein’s opening brief”). 1 explained by the Dissenting Justices, “[their] disagreement with the majority is only that it goes too far... [The majority] decides the issue of jurisdiction under the arbitration provisions, even though the arbitration clauses reserved to the arbitrator the right to determine the issue of arbitrability”. (R. 601-602) Notwithstanding the foregoing, Plaintiffs-Respondents wholly ignore and fail to refute that: (i) Agreement 4 and the Termination Agreement expressly incorporate by reference the LCIA rules; and (ii) Article 23.1 of the LCIA rules provides that an arbitrator shall determine the gateway issue of arbitrability, expressly including disputes concerning the “scope of the Arbitration Agreement.” As such, Plaintiffs- Respondents’ contention that “there was no clear and unmistakable evidence…of the parties’ intent to delegate the decision on arbitrability to the arbitrator” is wholly at odds with the express incorporation of the LCIA rules into Agreement 4 and the Termination Agreement, and the Dissenting Justices’ conclusion. (See Plaintiffs- Respondents’ Brief at p. 2.) Moreover, Plaintiffs-Respondents’ claim that “Stein and Aurdeley have failed to cite to a single case supporting the dissent’s theory that there is clear and unmistakable evidence of intent here” is patently false. (See Plaintiffs-Respondents’ Brief at p. 3.) Indeed, as discussed in Stein’s opening brief, the incorporation of and reference to a precise set of arbitration rules constitutes “clear and unmistakable evidence” of the intent to proceed under and comply with said rules, including rules 2 which establish the arbitrator’s authority to adjudicate the gateway issue of arbitrability. Additionally, the Termination Agreement was executed for its expressly stated purpose of terminating the Quennington Agreement in its entirety, including the forum selection clause therein. Plaintiffs-Respondents (erroneously) contend that the forum selection clause in the Quennington Agreement was not terminated, but rather that it somehow survived its express termination. As such, the effect of the Termination Agreement upon the forum selection clause in the Quennington Agreement is disputed, and said dispute unequivocally “aris[es] out of or [is] in connection with” the Termination Agreement. It is noted that the scope of the release in the Termination Agreement is similarly disputed, and the adjudication of this dispute (which concerns interpretation and is clearly subject to arbitration) is a necessary pre-requisite to any determination regarding the Quennington Agreement. In this regard, if all liability has been released, this is a complete defense to any claims arising under the Quennington Agreement, and renders the adjudication of the scope of the arbitration clauses academic. Thus, it is clear that these central and dispositive issues plainly invoke the arbitration clauses in the parties’ later agreements. Furthermore, Plaintiffs-Respondents confuse “clear manifestation” of the intention required to terminate a forum selection, with “express manifestation.” By 3 misconstruing “clear manifestation” to require “express manifestation,” Plaintiffs- Respondents improperly argue that “New York law requires a complete cancellation of all terms in the prior agreement, ab initio, and an ‘obliteration’ of the earlier provision regarding the resolution of disputes.” (See Plaintiffs-Respondents’ Brief at p. 4.) However, it is clear that New York law requires no such “obliteration”. It is likewise wrong (and outright illogical) for Plaintiffs-Respondents to contend that Agreement 4 was “a continuation of the Quennington Agreement…and establishes the terms of the parties’ overall relationship”, because: (i) the parties to Agreement 4 are wholly different from the parties to the Quennington Agreement; (ii) the relationship between Quennington and Stein was expressly terminated by the Termination Agreement; and (iii) all liability arising under the Quennington Agreement was expressly released by the Termination Agreement. (See Plaintiffs- Respondents’ Brief at p. 8.) Plaintiffs-Respondents also erroneously contend that it was the parties’ intention for claims concerning the “parties’ legal relationship” to be litigated under the Quennington Agreement, while all other claims would be arbitrated. To suggest that the parties intended to divide the method for adjudicating earlier arising claims versus later, not only defies logic, but moreover lacks any commercial sensibility. Also, Plaintiffs-Respondents incorrectly contend that Stein raises the applicability of English law for the first time on appeal. (See Respondents- 4 Plaintiffs’ Brief at p. 33.) In making this meritless argument, Plaintiffs-Respondents wholly ignore the plain and clear terms of Agreement 4 and the Termination Agreement, which specify that any disputes arising under same shall be governed by English law. Moreover, Plaintiffs-Respondents also disregard Stein’s arguments in his Appellate Division brief that specifically address the applicability of English law. Finally, Plaintiffs-Respondents’ argument that public policy favors arbitration “only [] where there is unequivocal evidence of an agreement to arbitrate, which is not the case here” flies in the face of the broad and clear arbitration clauses contained in Agreement 4 and the Termination Agreement. (See Plaintiffs-Respondents’ Brief at p. 5.) Equally baseless is Plaintiffs-Respondents’ claim that “Stein and Aurdeley have already delayed this case for two years…through their ill-founded motions to compel”, in light of the following: (i) Justice Kornreich granted Defendants- Appellants’ motions to compel arbitration in their entirety, and took the extraordinary step of dismissing the instant action sua sponte; and (ii) the Dissenting Justices ruled that they “would affirm the motion court’s decision to compel arbitration at this juncture”. (See Plaintiffs-Respondents’ Brief at p. 5.) (R. 49, 594.) A. Stein is Not a New York Domiciliary Plaintiffs-Respondents commenced the instant action based upon their frivolous assertion that Stein is a New York domiciliary. To be clear, Stein has resided and worked outside of the United States since 1997, and abandoned his New 5 York domicile at that time. As previously noted, immediately following the commencement of the instant action, Plaintiffs-Respondents served extensive and burdensome discovery concerning Stein’s domicile. Their purported urgency for same is patently suspect in light of the following: (i) Stein was employed by Chodiev (outside of the United States) during the relevant periods underlying the Complaint; and (ii) during said employment, Chodiev paid Stein’s housing expenses. As such, Plaintiffs-Respondents have known (all along) where Stein resided, and moreover that he is not a New York domiciliary. B. Aurdeley is Not Stein’s Alter Ego The issue of who controls Aurdeley was not before the Appellate Division, and lacks relevance to this appeal. However, Plaintiffs-Respondents continue to run unsubstantiated allegations that Aurdeley is Stein’s alter ego to color these proceedings and distract from relevant issues.2 Indeed, Stein wholly denies that Aurdeley is his alter ego, as that allegation is entirely false. Additionally, there has been no serious evidence substantiating Plaintiffs- Respondents’ claims, nor any judicial determinations made regarding same. However, Plaintiffs-Respondents misrepresent that Mr. Justice Burton made such a 2 Plaintiffs-Respondents improperly refer to Stein’s prior motion to modify the Appellate Division Order. (See Plaintiffs-Respondents’ Brief at p. 66.) The issues addressed therein are not before this Court, nor part of the Record on Appeal. 6 determination in his May 20, 2015 Judgment (“May 20th Judgment”). Moreover, Plaintiffs-Respondents’ allegation “that Stein lied in the Original Stein Proceedings about his relationship with Aurdeley” is entirely false, and also a misrepresentation to this Court. (See Plaintiffs-Respondents’ Brief at p. 18; see also May 20th Judgment annexed to the Affirmation of Pieter Van Tol, dated August 25, 2016 (“Van Tol Aff.”) at Exhibit 3.) Specifically, Mr. Justice Burton did not rule in his May 20th Judgment that Stein is Aurdeley’s alter ego or its beneficial owner, nor make any factual findings regarding same. (See Van Tol Aff., Ex. 3.) Rather, Mr. Justice Burton found “that there is an arguable case that…[Stein] is the beneficial owner of Aurdeley”; but also found that he [Mr. Justice Burton] was not persuaded that Stein’s statements in this regard “are even arguably lies” because his position was supported by contemporaneous evidence. (Id. at ¶¶ 29(i), 36 (emphasis added).) Mr. Justice Burton additionally noted “[o]nce again however there were powerful independent factors supporting [] [Stein’s] account and rebutting that of the Claimants.” (Id. at ¶ 42.) Accordingly, Plaintiffs-Respondents purposely misconstrue the term “arguable” with “factual”, in further contorting the May 20th Judgment to fit their manufactured allegations. Plaintiffs-Respondents also allege that Stein lied about Aurdeley funding the English proceedings. (See Plaintiffs-Respondents’ Brief at p. 19.) This too is false 7 as reflected in Stein’s First Witness Statement, dated December 9, 2014. (See First Witness Statement of Stein annexed to the Grossman Aff., Ex. A, “Reply Aff. of JAG & Exs.”) In this regard, Stein was compelled to use his entire life savings to fund the Original English Proceeding. (See First Witness Statement of Stein at ¶ 47 annexed to the Grossman Aff., Ex. A, “Reply Aff. of JAG & Exs.”) As a result of his financial hardship, Stein entered into a loan agreement with Zakhar Zakharov, Aurdeley’s owner at the time, to fund his mounting legal expenses. Stein was required to repay Aurdeley the full amount borrowed, and has in fact done so. (See First Witness Statement of Stein at ¶ 48 annexed to the Grossman Aff., Ex. A, “Reply Aff. of JAG & Exs.”) Simply stated, Stein testified truthfully that he used his life savings to prosecute the Original English Proceeding, but did not additionally disclose the Aurdeley loan as he was never asked about same, nor was this relevant. Moreover, and as Plaintiffs-Respondents are well aware, Stein’s reluctance to identify Mr. Zakharov (and the Aurdeley loan) was two-fold: (i) he feared for Mr. Zakharov’s personal safety; and (ii) such disclosure would derail the loan and Stein’s ability to prosecute the Original English Proceedings. (See First Witness Statement of Stein at ¶¶ 51, 52 annexed to the Grossman Aff., Ex. A, “Reply Aff. of JAG & Exs.”) Thus, viewed in its proper context, Stein’s testimony is understandable and justifiable. 8 C. London is the Appropriate Forum to Arbitrate All Disputes Between the Parties Plaintiffs-Respondents’ calculated decision to litigate in New York (rather than arbitrate in London) truly underscores the “revenge” tactics employed herein. Indeed: (i) all relevant witnesses and documents are located in England, Russia, Kazakhstan, Ukraine, and China; (ii) the transactions at issue all occurred in England, Russia, Kazakhstan, Ukraine, and China; and (iii) English law governs the instant action. As such, an arbitrator in London is best situated to adjudicate the instant action. LEGAL ARGUMENT I. AN ARBITRATOR MUST DECIDE THE GATEWAY ISSUE OF ARBITRABILITY A. Plaintiffs-Respondents Artificially Elevate the Standard of Review Plaintiffs-Respondents claim in conclusory fashion that Defendants- Appellants have a “substantial burden on this appeal”, which is an “exceedingly high standard.” (See Plaintiffs-Respondents’ Brief at pp. 1, 20.) However, Plaintiffs- Respondents fail to cite any relevant New York authority regarding this purportedly elevated standard. Additionally, the Majority’s complete disregard of the terms contained in Agreement 4 and the Termination Agreement was improper, and wrong as a matter 9 of law since it: (i) usurped the arbitrator’s authority to adjudicate arbitrability under Article 23.1 of the LCIA rules; (ii) ignored the parties’ express contractual agreements by failing to invoke the Termination Agreement’s arbitration clause; (iii) failed to apply English law as required by Agreement 4 and the Termination Agreement; and/or (iv) improperly applied New York law to same. These are all issues of law which can and should be reviewed by this Court de novo. B. The Gateway Issue of Arbitrability Belongs to an Arbitrator Pursuant to the express terms of Agreement 4 and the Termination Agreement, each of which specifically incorporate by reference the LCIA rules, the parties clearly and unmistakably agreed for an arbitrator to adjudicate the gateway issue of arbitrability. It is well established under New York law that when parties agree to a broad arbitration clause, and expressly incorporate by reference rules authorizing an arbitrator to determine its own jurisdiction, the gateway issue of arbitrability must be determined by an arbitrator. Life Receivables Trust v. Goshawk Syndicate 102 at Lloyd’s, 66 A.D.3d 495, 496 (1st Dep’t 2009), aff’d 14 N.Y.3d 850 (2010), cert denied 562 U.S. 962 (2010) (stating that “[a]lthough the question of arbitrability is generally an issue for judicial determination, when the parties’ agreement specifically incorporates by reference the AAA rules, which provide that ‘[t]he tribunal shall have the power to rule on its own jurisdiction, including objections 10 with respect to the existence, scope or validity of the arbitration agreement,’ and employs language referring ‘all disputes’ to arbitration, courts will leave the question of arbitrability to the arbitrators’”); Icdas Celik Enerji Tersane Ve Ulasim Sanayi A.S. v. Travelers Ins. Co., 81 A.D.3d 481, 483 (1st Dep’t 2011) citing to Life Receivables Trust, 66 A.D.3d 495, 496, aff’d 14 N.Y.3d 850 (finding that “given the arbitration clause’s specific incorporation by reference of AAA rules, the question of arbitrability, which includes the existence, scope and validity of the arbitration agreement, is for the arbitrator to determine”); Zachariou v. Manios, 68 A.D.3d 539, 539 (1st Dep’t 2009) citing to Life Receivables Trust, 66 A.D.3d 495, 496 quoting Matter of Smith Barney Shearson v. Sacharow, 91 N.Y.2d 39, 47 (1997) (noting that “[w]here there is a broad arbitration clause and the parties’ agreement specifically incorporates by reference the American Arbitration Association (AAA) rules providing that the arbitration panel shall have the power to rule on its own jurisdiction, courts will ‘leave the question of arbitrability to the arbitrators’”). Indeed, the incorporation of and reference to a particular set of arbitration rules is “clear and unmistakable” evidence of the parties’ intention to delegate “the question of arbitrability to the arbitrators.” See Smith Barney Shearson, 91 N.Y.2d 39, 47; Gibson v. Seabury Transp. Advisor LLC, 91 A.D.3d 465, 465 (1st Dep’t 2012); Dow Kim v. Dukon, 89 A.D.3d 470, 471 (1st Dep’t 2011). 11 (i) Plaintiffs-Respondents’ Reliance on Federal Case Law is Misplaced Plaintiffs-Respondents mistakenly assert that “[f]ederal cases are consistent with the majority opinion in the Appellate Division Order.” (See Plaintiffs- Respondents’ Brief at p. 29.) Specifically, Plaintiffs-Respondents’ misplace their reliance on two trial court decisions, Gen. Motors Corp. v. Fiat S.p.A., 678 F. Supp.2d 141 (S. D. N. Y., 2009), and Pictet Funds (Europe) S.A. v. Emerging Managers Group, L.P., 2014 WL 6766011 (S. D. N. Y., December 1, 2014), to support their erroneous position that the parties did not clearly and unmistakably delegate the gateway issue of arbitrability to an arbitrator. (See Plaintiffs- Respondents’ Brief at pp. 29 - 31.) In General Motors, the trial court addressed a situation factually distinct from the instant action. 2014 WL 6766011. In General Motors, the parties entered into two agreements on the same day, each containing broad arbitration clauses governed by different bodies of law and arbitration rules. As such, and given the direct conflict between the two arbitration clauses, the trial court properly (and understandably) ruled that there was no “clear and unmistakable” evidence of the parties’ intention to comply with a particular set of arbitration rules. 2014 WL 6766011 at *146. Notably, in General Motors (unlike the instant action) there were no subsequent agreements amending, terminating, integrating, and/or superseding either of the subject agreements. Here, the Quennington Agreement was amended, integrated, 12 and superseded by Agreement 4, and expressly terminated by the Termination Agreement. Thus, no ambiguity exists in the instant action regarding the parties’ clear and unmistakable intention to be bound by LCIA Rules and English law, as was the case in General Motors. In Pictet, the arbitration clause applied only to a narrow set of issues (i.e., fees payable), and not to “the more general dispute resolution provision…” 2014 WL 6766011 at * 2. The parties in Pictet, therefore, had only one agreement, and expressly carved-out the right to arbitrate a limited set of issues from the general dispute resolution mechanism therein. Here, the parties terminated and superseded earlier agreements in their entirety, and mutually consented to new and broad arbitration clauses. As such, Pictet has no application to the instant action. II. THE FORUM SELECTION CLAUSE IN THE QUENNINGTON AGREEMENT WAS TERMINATED A. The Dispute Over the Temination of the Forum Selection Clause in the Quennington Agreement Must be Arbitrated Pursuant to the Express Terms of the Termination Agreement The purpose of the Termination Agreement was to terminate the Quennington Agreement, by mutual consent of the parties. Thus, a dispositive issue on appeal is whether the Termination Agreement terminated all of the provisions in the Quennington Agreement, and more specifically its forum selection clause. Indeed, the parties (and the Appellate Division) dispute this issue. 13 The Termination Agreement specifically provides that “[a]ny dispute arising out of or in connection with this agreement…shall be…resolved by arbitration under [LCIA] Rules…[in] London.” (R. 116.) Clearly, a dispute regarding the scope and effect of the Termination Agreement, and more specifically, whether it terminated the forum selection clause in the Quennington Agreement, “arises out of” and/or is “in connection with” the Termination Agreement. This much is indisputable. It is axiomatic, therefore, that the only operative clause governing disputes arising out of the Termination Agreement is the arbitration clause therein. As such, it is a fallacy to suggest that Stein is asking this Court to apply “the arbitration clauses…retroactively”. (See Plaintiffs-Respondents’ Brief at p. 48.) Rather, Stein simply submits that on the plain reading of the Termination Agreement, any disputes concerning the termination of the forum selection clause in the Quennington Agreement are expressly required to be arbitrated in London. B. Plaintiffs-Respondents Confuse and Misconstrue “Clear Manifestation” to Require “Express Manifestation” The parties to Agreement 4 and the Termination Agreement evidenced a “clear manifestation” to terminate the forum selection clause in the Quennington Agreement. Plaintiffs-Respondents fail to comprehend that under New York law, the parties must only demonstrate a “clear manifestation” of an intention to abandon an earlier forum selection clause, and not an “express manifestation.” Primex Intl. 14 Corp. v. Wal-Mart Stores, 89 N.Y.2d 594 (1997).3 In this regard, Plaintiffs- Respondents incorrectly contend that “if the parties had wanted an arbitrator to decide the disputes arising out of the pre-July 1, 2009 agreements or the parties’ legal relationship…they would have specifically nullified the earlier forum selection provision…” (See Plaintiffs-Respondents’ Brief at p. 25 (emphasis added).) Simply stated, Plaintiffs-Respondents manufacture a heightened standard to terminate a forum selection clause, that is not otherwise required by New York law. Additionally, Plaintiffs-Respondents misplace their reliance on Matter of Schlaifer, 51 N.Y.2d 181 (1980) and Matter of Minkin, 279 A.D. 226 (2d Dep’t 1951) for the proposition that an “instruction of cancellation” must include a “complete nullification, ab initio, of every provision of the prior agreement, including its arbitration clause.” (See Plaintiffs-Respondents’ Brief at p. 57.) Similarly, Plaintiffs-Respondents improperly rely on Schlaifer for the proposition that “Agreement 4 falls well short of the Schlaifer standard, which requires a “complete nullification” of every provision in the Quennington Agreement, including the forum selection clause.” (Id. at p. 58.) Critically (however), neither the Court in Schlaifer or Minkin ruled that the termination of a forum selection 3 Primex is factually distinct and inapposite from the instant action, and lends no support to Plaintiffs-Respondents’ arguments and/or the Appellate Division Order. Here (unlike Primex), the parties’ later agreements not only amend, terminate, integrate, and supersede the parties’ earlier agreements, but also amend the parties’ relationship, and include broad arbitration clauses that incorporate by reference LCIA rules. Thus, in the instant action, there is a clear manifestation of intention to terminate the Quennington Agreement’s forum selection clause. 15 clause must occur by “complete nullification” or “obliteration.” 51 N.Y.2d 181; 279 A.D. 226. As such, Plaintiffs-Respondents’ reliance on Schlaifer and Minkin is entirely misplaced, and lends no support to their argument. Moreover, Plaintiffs-Respondents’ fabricated position that a “clear manifestation” requires a “complete nullification” and/or an “obliteration” would lead to dire consequences in the commercial marketplace. Indeed, such a heightened standard would have a devastating impact upon commercial parties who routinely enter into multiple, consecutive agreements that include both merger and distinct forum selection clauses in their later agreements. Accepting Plaintiffs-Respondents’ contentions as true would result in parties being stripped of their duly bargained for contractual rights to adjudicate disputes in mutually agreed upon forums/manners, as prior forum selection clauses (that were otherwise amended, terminated, integrated, and/or superseded) would still survive, unless the parties use the “magic language” to terminate the earlier forum selection clause. At a minimum, such a result would invite abuses from parties seeking to litigate around express arbitration clauses -- which is precisely the case here.4 4 In Goldman, Sachs & Co. v. Golden Empire Schools Fin. Auth., 764 F.3d 210, 216 (2d Cir. 2014), the court held that a later executed agreement, that included a mandatory forum selection clause, superseded and voided the earlier arbitration provision; see Applied Energetics, Inc. v. New Oak Capital Markets, LLC, 645 F.3d 522, 524 (2d Cir. 2011) (same). 16 (i) The Parties to the Termination Agreement and Agreement 4 Expressed a “Clear Manifestation” to Terminate the Forum Selection Clause in the Quennington Agreement Here, the parties expressed a “clear manifestation” of an intention to terminate the forum selection clause in the Quennington Agreement. In this regard, Stein cites the following as unequivocal evidence of same: (i) the execution of the Termination Agreement, which terminated the Quennington Agreement, in its entirety, and released all liability arising thereunder; (ii) the parties’ mutual consent to a broad mandatory arbitration clause in the Termination Agreement, which specifically provides that “[a]ny dispute arising out of or in connection with this agreement…shall be…resolved by arbitration under [LCIA] Rules…[in] London.” (R. 116.); (iii) no survivability language in the Termination Agreement (or the Quennington Agreement) regarding the forum selection clause in the Quennington Agreement; (iv) the preamble to Agreement 4 specifically references the Quennington Agreement and Agreement 2, and states the parties “wish to amend the terms of the engagement of [Aurdeley] and [Mr. Stein]” (R. 102); (v) the merger clause in Agreement 4 states “[t]his Agreement contains the entire agreement and understanding of the parties and supersedes all prior arrangements, agreements or understandings (both oral and written), relating to the subject matter of this Agreement.”5 (R. 109.); (vi) the parties’ mutual consent to a broad mandatory arbitration clause in Agreement 4, rather than a forum selection clause similar to the Quennington Agreement; and 5 Here, all of the parties’ agreements relate to the same subject matter. Thus, Agreement 4’s merger clause subsumes all of the parties’ earlier agreements. 17 (vii) no survivability language in Agreement 4 (or Agreement 2) regarding the forum selection clause in the Quennington Agreement. In light of the foregoing, the later agreements evidence the parties’ “clear manifestation” of their intention to terminate the Quennington Agreement in its entirety, and to arbitrate all disputes arising from said termination. Additionally, Plaintiffs-Respondents cite several cases which lend no support to their baseless contention that “a forum selection clause survive[s] the termination of the agreements in which they are contained, unless there is a specific statement that the forum selection clause has been terminated.”6 (See Plaintiffs-Respondents’ Brief at p. 44.) In this regard, Plaintiffs-Respondents cite to only one New York State court decision, Getty Petroleum Marketing Inc. v. 1314 Sedgwick Ave. LLC, 106 A.D.3d 429 (1st Dep’t 2013), which is inapposite to the facts of the instant action. In Getty (unlike here), there was not any of the following: (i) a later agreement that contained a distinct arbitration clause; (ii) a later agreement that expressly terminated an earlier agreement in its entirety; nor (iii) a later agreement that contained a broad merger clause. 106 A.D.3d 429. 6 Plaintiffs-Respondents’ reliance on federal case law from the trial court level has no authoritative value to the instant appeal. 18 C. Plaintiffs-Respondents Mistakenly Contend that the Release in the Termination Agreement is Limited Only to Payments Under the Quennington Agreement Plaintiffs-Respondents mistakenly contend that “Agreement 4 and the Termination Agreement contain only limited releases aimed at payments due under Agreement 2 and the Quennington Agreement.” (See Plaintiffs-Respondents’ Brief at p. 60.) However, the release in the Termination Agreement states that neither Stein nor Quennington shall have “any further liability to other of whatsoever nature pursuant to or in respect of the [Quennington] Agreement…” (R. 116.) As such, the parties to the Termination Agreement plainly and expressly released all liability arising under the Quennington Agreement. Notwithstanding the foregoing, the Termination Agreement is clear that any disputes concerning same must be arbitrated in London.7 D. Agreement 4 is Not a Continuation of the Quennington Agreement Plaintiffs-Respondents incorrectly contend that “Agreement 4 was merely a continuation of the Quennington Agreement…and there is no evidence that the parties sought to replace the forum selection clause in the Quennington Agreement.” (See Plaintiffs-Respondents’ Brief at p. 49.) However, Plaintiffs-Respondents 7 If only future liability were released and the forum selection clause survived, then what substantive rights of Stein were “altered” by the Termination Agreement? None, other than a right not to receive additional payments from Quennington. This strained interpretation leaves Stein without any consideration for entering into the Termination Agreement. 19 plainly concede that Agreement 4 was not a continuation of the Quennington Agreement by stating that “Agreement 4 was a modification of the compensation terms set forth in the Quennington Agreement.” (See Plaintiffs-Respondents’ Brief at p. 58.) Moreover, in running this argument Plaintiffs-Respondents wholly ignore the following: (i) the preamble to Agreement 4 uses clear and specific language amending, integrating, and superseding the Quennington Agreement; (ii) the Termination Agreement expressly terminated the Quennington Agreement, in its entirety, and released all liability arising thereunder; (iii) the parties to the Quennington Agreement differ wholly from the parties to Agreement 4; (iv) the compensation arrangements under the Quennington Agreement and Agreement 4 are starkly different; and (v) the forum selection clause in the Quennington Agreement is significantly different from the arbitration clause in Agreement 4. As such, this Court need look no further than the express terms of the Termination Agreement and Agreement 4 in order to conclude that the parties intended to terminate and replace the Quennington Agreement in its entirety. Thus, Agreement 4 is not (and cannot properly be viewed as) a continuation of the Quennington Agreement under any circumstance. 20 E. The Parties Did Not Intend for Claims Relating to Their “Legal Relationship” to be Adjudicated Differently Than Other Claims Plaintiffs-Respondents’ contention that the parties to Agreement 4 intended to arbitrate all disputes arising from same, except for claims relating to the “parties’ legal relationship” is nonsensical. In support of their baseless position, Plaintiffs- Respondents suggest that the parties to Agreement 4 “intentionally omitted any reference to the relationship established by the agreements.” (See Plaintiffs- Respondents’ Brief at p. 41.) To justify this purported omission, Plaintiffs- Respondents further suggest that “[t]he most plausible explanation is that the parties intended to narrow the scope of the arbitration clauses in the post-June 30, 2009 agreements when they omitted any reference to the ‘legal relationship’ established by the contracts, in stark contrast to the pre-July 1, 2009 agreements.” (See Plaintiffs-Respondents’ Brief at pp. 41 – 42.) This is illogical. There is obvious logic to the presumption that when an agreement is entered into for the purpose of terminating an earlier agreement, unless expressly stated, the parties intend a “one-stop” shop to adjudicate all disputes. It is further logical that when parties agree to a new forum selection clause, which comes later in time, it is the new forum selection clause that controls and not the forum selection clause in an otherwise terminated agreement. Moreover, Plaintiffs-Respondents’ explanation fails as they cannot possibly differentiate disputes pertaining to the “legal relationship established by” the 21 Quennington Agreement from others, as every commercial dispute necessarily invokes the parties’ legal relationship. Indeed, the inclusion of such language in the Quennington Agreement’s forum selection clause cannot give life to an otherwise terminated provision. To distinguish claims in that manner creates an ambiguity where none exists, and renders the arbitration clause in the Termination Agreement a nullity. Furthermore, the Majority’s reliance on Steigerwald v. Dean Witter Reynolds, 84 A.D.2d 905, 906 (4th Dep’t 1981), aff’d 56 N.Y.2d 621 (1982) lends no credence to their argument that the instant action must be litigated in this forum. (R. 590). Significantly, as the Majority noted, this Court has not held whether Steigerwald is controlling for the proposition that all Plaintiffs-Respondents’ claims (even those subject to arbitration) be litigated since they are purportedly “inextricably bound together” (even though they deal with different parties are cover claims arising under different time periods). (Id.) It is respectfully submitted that litigating claims that should otherwise be arbitrated strips parties of their duly bargained for contractual rights, and wastes party and judicial resources. Significantly, Plaintiffs-Respondents’ arguments contain several inconsistencies regarding the purported similarity of claims that arise under the Quennington Agreement and Agreement 4. On one hand, Plaintiffs-Respondents argue that claims arising out of the Quennington Agreement and Agreement 4 are 22 “cut from the same cloth”, “inextricably bound together”, and “inextricably linked.” (See Plaintiffs-Respondents’ Brief at pp. 5, 13, 62.) Yet, Plaintiffs-Respondents simultaneously argue that: (i) “the clauses cover different subject matters…”; and (ii) “the arbitration clauses do not supersede the forum selection clause because (among other reasons) the subject matter is different.” (See Plaintiffs-Respondents’ Brief at pp. 50, 51 (emphasis in the original).) Plaintiffs-Respondents cannot have it both ways. Accordingly, their self-serving duplicitousness should not be tolerated, nor rewarded by this Court. III. EVEN IF THE MAJORITY HAD THE AUTHORITY TO INTERPRET AGREEMENT 4 AND THE TERMINATION AGREEMENT, IT SHOULD HAVE APPLIED ENGLISH LAW A. Stein is Not Raising the Applicability of English Law for the First Time on Appeal Plaintiffs-Respondents erroneously contend that Stein is arguing for the first time on appeal that English law governs the instant action. (See Plaintiffs- Respondents’ Brief at p. 33.) In advancing this meritless argument, Plaintiffs- Respondents ignore: (i) the plain terms of Agreement 4 and the Termination Agreement which expressly provide that English law governs; (ii) Justice Kornreich’s findings that English law governs (R. 25, 27, 33, 40, 41.); and (iii) Stein’s arguments in his Appellate Division brief that English law governs. 2015 WL 11077900 (1st Dep’t 2015). Specifically, Stein argued “… [t]he Termination 23 Agreement is clear that this dispute over the scope of said release is governed by the laws of England and Wales, and must be submitted to arbitration in London.” Id. at *14 (emphasis in original). Similarly, Stein argued “the ultimate resolution and construction of said release is…to be determined by arbitration under the LCIA Rules in London, England, and construed in accordance with the laws of England and Wales.” Id. at *16. Accordingly, based upon the foregoing, it is clear that Stein’s argument concerning the applicability of English law was not raised for the first time on appeal. B. English Law Governs All Substantive Issues Arising Under Agreement 4 and the Termination Agreement Even if the Majority had the authority to interpret Agreement 4 and the Termination Agreement, it should have applied English law.8 As stated in New York Trans Harbor LLC v. Derecktor, Inc., 19 Misc.3d 11349(A) at *2-3, 862 N.Y.S.2d 908 (Sup. Ct. Kings Co. May 19, 2008), upon which Plaintiffs-Respondents also rely, “the provision requiring the application of English law ‘operate[][s] [] to import the substantive law of [England]’…[and] [t]here is no doubt that the clause requires the application of English law to the substantive issues herein.” (citation omitted). 8 As discussed in Stein’s opening brief, the Majority should have applied Fiona Trust in determining the scope of the arbtiration clause in Agreement 4 and the Termination Agreement. 24 Under New York law, the dispute concerning the parties’ relationship under the Quennington Agreement is a substantive issue, and not merely procedural.9 Mariano v. Town of Orchard Park, 92 A.D.3d 1232 (4th Dep’t 2012) (“issues concerning the PBA’s relationship to retired employees ... are matters involving the scope of the substantive contractual provisions and, as such, are for the arbitrator”). Moreover, Black’s Law Dictionary defines “substantive law” as “[t]he part of the law that creates, defines, and regulates the rights, duties, and powers of parties.” 3rd Pocket Edition, 2006, Garner, Bryan. Thus, whether the scope of the arbitration clause in the Termination Agreement subsumes disputes concerning the “parties’ legal relationship” under the Quennington Agreement is (at its core) a substantive issue, governed by English law. C. Plaintiffs-Respondents’ Reliance on New York Law Lends Support to Stein’s Position that the Instant Action be Arbitrated in London Even if this Court were to apply New York law, Plaintiffs-Respondents’ reliance thereon actually lends support to Stein’s arguments favoring arbitration. (See Plaintiffs-Respondents’ Brief at p. 35.) For instance, in Brooke Group Ltd. v. JCH Syndicate 488, 87 N.Y.2d 530, 533 (1996), this Court addressed the merits of a motion to dismiss based upon forum 9 Plaintiffs-Respondents errorenously contend that this Court is addressing a procedural issue. (See Plaintiffs-Respondents’ Brief at p. 36). However, a dispute concerning whether the “parties’ legal relationship” under the Quennington Agreement is subject to the terms of the arbtiration clause in the Termination Agreement is a substantive issue. 25 non conveniens. In Brooke, there was a broad arbitration clause whereby “all disputes’ concerning the interpretation, validity and performance of the [] [subject agreement]…would be governed by the law of England and submitted to arbitration at the [LCIA] in accordance with its rules.” Id. at 532. In addition, there was a “Service of Suit Clause” which provided “in the event the underwriters failed to pay any amount claimed to be due on the policy, the underwriters would, at the plaintiff’s request, submit to the jurisdiction of a court of competent jurisdiction within the United States.” Id. This Court affirmed the lower courts’ dismissal since “the suit was between two foreign corporations, concerned insurance issued in England, covered property in Russia, and there was already an arbitration forum available to resolve the dispute.” Id. at 533. This Court further ruled that “the courts below did not abuse its discretion in concluding that the other factors involved in the dispute, unrelated to New York, supported the defendant’s motion to dismiss. (citations omitted)” Id. at 534 – 535. Furthermore, Plaintiffs-Respondents’ misplaced reliance on the following unreported trial court decisions (New York Trans Harbor, 19 Misc.3d 1134 (A), and USA-India Export-Import, Inc. v. Coca-Cola Refreshments USA, Inc., 46 Misc.3d 1215(A), 9 N.Y.S.3d 596 (Sup. Ct. Westchester Co. Jan. 30, 2015)) also supports Stein’s arguments for arbitration. 26 In New York Trans Harbor, the dispute concerned the scope of a settlement agreement, and whether said dispute was subject to the arbitration clause contained therein. 19 Misc.3d 1134 (A) at *3 - 4. Similar to the instant action, the trial court in New York Trans Harbor ruled that “[t]he provision contained in the Settlement Agreement is clear and unambiguous in directing that the resolution of any dispute between [] [between the parties] regarding the interpretation of the settlement be by arbitration in London.” Id. at *4 (emphasis in original). In USA-India, the forum selection clause in the subject agreements designated Georgia as the forum for litigation. 46 Misc.3d 1215(A) at *3. The plaintiff in USA- India argued that a Georgia court was not competent to properly apply New York law, since Georgia does not maintain similar laws. Id. at *9. This concern is of no consequence here since an arbitrator in London is not only best situated to adjudicate the instant action in accordance with English law, but also has the exclusive jurisdiction to do so. Notably, the trial court in USA-India ruled that “the language here is plain: the exclusive venue for litigation is Georgia. No temporal limitation is expressed. There is no indication that the forum selection clause is divisible.” Id. at * 11. Thus, in applying the ruling from USA-India to the forum selection clauses in the parties’ later agreements, it is clear that arbitration in London is not only appropriate, but required. 27 D. Fiona Trust Applies to Agreement 4 and the Termination Agreement Plaintiffs-Respondents’ position that “there is no evidence that the parties intended to rely upon Fili Shipping Co. Ltd. v. Premium Nafta Prods. Ltd. (“Fiona Trust”), (2007) UKHL 40 to make the arbitration clauses as broad as the forum selection clause in the Quennington Agreement” is nonsensical. (See Plaintiffs- Respondents’ Brief at p. 41.) Clearly, the parties to Agreement 4 and the Termination Agreement are sophisticated entities who at arms-length negotiated and mutually agreed for English law to govern the instant action. Plaintiffs- Respondents’ ignorance in their belief that Fiona Trust does not apply to the parties’ later agreements, does not prevent its application.10 Equally unavailing is Plaintiffs- Respondents’ speculative argument that “[i]f the parties in fact had been relying on Fiona Trust, they would have not included the reference to the existence or validity of the agreements.” (See Plaintiffs-Respondents’ Brief at p. 41.) In applying Fiona Trust to the Termination Agreement, it is clear that the scope of an arbitration clause is to be interpreted broadly to cover all disputes 10 Plaintiffs-Respondents incorrectly contend that Lord Hoffman’s ruling in Fiona Trust concerning the scope of an arbitration clause is dicta. (See Plaintiffs-Respondents’ Brief at p. 39.) In Emmott v. Michael Wilson (No. 2), [2009] EWHC 1 (Comm), Mr. Justice Teare applied Fiona Trust when considering the arbitral tribunal’s jurisdiction by stating “[t]he principles governing the construction of arbitration clauses are now to be found in Fiona Trust…” Similarly, in Egiazaryan v. OJSC OEk Finance, [2015] EWHC 3532 (Comm), on appeal to the High Court, Mr. Justice Burton overturned the arbitral tribunal’s declination of jurisdiction, finding the tort claim “falls within the terms of the arbitration clauses in the [agreements], widely construed as now encouraged by Fiona Trust.” 28 between the parties. Plaintiffs-Respondents’ argument that “if the parties wanted to replace the forum selection clause in the Quennington Agreement, they would have used equally broad language in the arbitration clauses” plainly contradicts Fiona Trust.11 (See Plaintiffs-Respondents’ Brief at p. 46.) Additionally, Plaintiffs-Respondents’ reliance on Sebastian Holdings Inc. v. Deutsche Bank AG, [2010] EWCA (Civ) 998 is entirely misplaced since it too is factually distinct from the instant action. Here, Stein is bound to one contract only, i.e., the Termination Agreement. In Sebastian, the Court addressed a situation “where parties are [simultaneously] bound by several contracts which contain jurisdiction agreements for different countries.” Id. at ¶ 49. Furthermore, for the reasons discussed supra in “II. B.(i)”, when applying the “centre of gravity” analysis from Sebastian to the instant action, it is clear that any dispute concerning the termination of the Quennington Agreement, including its forum selection clause, necessarily invokes the arbitration clause in the Termination Agreement. 12 Id. at 35. 11 Fiona Trust established that under English law, disputes concerning the parties’ legal relationship are presumed to be subject to an arbitration clause. 12 In Monde Petroleum SA v. Westernzagros Ltd., [2015] EWHC 67 (Comm), having considered the wide interpretation placed on the arbitration clause in Fiona Trust, Mr. Justice Popplewell held that “[w]here the settlement/termination agreement contains a dispute resolution provision which is different from, and incompatible with, a dispute resolution clause in the earlier agreement, the parties are likely to have intended that it is the settlement/termination agreement clause which is to govern all aspects of outstanding disputes, and to supersede the clause in the earlier agreement, for a number of reasons. Firstly, it comes second in time…Secondly, it is the operative clause 29 Therefore, had the Majority appropriately applied English law, it would have concluded that the arbitration clauses in Agreement 4 and the Termination Agreement are deemed to include disputes relating to and arising out of the parties “legal relationship”, and at a minimum are equal in scope to the forum clause in the Quennington Agreement. IV. PUBLIC POLICY MANDATES THAT THE DISPUTE CONCERNING THE TERMINATION OF THE FORUM SELECTION CLAUSE IN THE QUENNINGTON AGREEMENT BE ARBITRATED IN LONDON Plaintiffs-Respondents concede that public policy favors arbitration “when there is a ‘clear, explicit and unequivocal’ agreement to arbitrate all the claims at issue.” (See Plaintiffs-Respondents’ Brief at p. 63 (citation omitted).) These are precisely the facts of the instant action. Here, pursuant to the express terms of Agreement 4 and the Termination Agreement, each of which specifically incorporate by reference the LCIA rules, the parties clearly and unmistakably agreed for an arbitrator to adjudicate the gateway issue of arbitrability. Additionally, the Termination Agreement provides a “clear, explicit and unequivocal agreement” to arbitrate all disputes relating to the termination of the Quennington Agreement, governing issues concerning the validity or effect of the termination/settlement agreement and the only clause capable of applying to disputes which arise out of or relate to the termination/settlement agreement.” 30 that the instant action be arbitrated in London, in accordance with LCIA rules and English law. CONCLUSION For the foregoing reasons, and for the reasons set forth in Stein's opening brief, Stein respectfully requests this Court to reverse the Appellate Division Order in its entirety, and reinstate the Supreme Court Order, compelling arbitration in London. Dated: New York, New York December 22, 20 16 TUREK ROTH GROSSMAN LLP ~;_~ By: __ ~---==~~------------ Jason A. Grossman Gaddi Goren 3 77 Fifth A venue - 6th Floor New York, New York 10016 (212) 223-3562 Attorneys for Defendant-Appellant Kirill Ace Stein 31 CERTIFICATION I certify pursuant to 500.13(c)(1) that the total word count for all printed text in the body of the brief, exclusive of the statement of the status of related litigation; the corporate disclosure statement; the table of contents, the table of cases and authorities and the statement of questions presented required by subsection (a) of this section; and any addendum containing material required by subsection 500.1(h) of this Part is 6,992 words.