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Current Developments in the Commercial Divisions of the
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Posted: July 31, 2014

Motion for Stay in Favor of Arbitration Denied When Complete Identity of Parties Lacking

On July 10, 2014, Justice Schweitzer of the New York County Commercial Division issued a decision in Interventure 77 Hudson LLC v. Falcon Real Estate Investment Co., LP, 2014 NY Slip Op. 31878(U), denying motions to compel arbitration.

In Interventure 77 Hudson LLC, three defendants moved for a stay in favor of arbitration “on the grounds that there is a parallel proceeding filed in arbitration and the claims in the arbitration proceeding factually overlap the claims brought in this action.” The court denied all three motions. The court began by explaining the standard:

The court may grant a stay under CPLR 2201 in a proper case. When the decision in one action will determine all the questions in the other action, and the judgment in one trial will dispose of the controversy in both actions, a case for a stay is presented. Where a party seeks the stay of an action pending the outcome of another action, complete identity of parties, causes of action and judgment sought are required. Although these elements are not specifically set forth in CPLR 2201, they are generally adhered to.

(Internal quotations and citations omitted) (emphasis added). The court went on to deny all three motions, finding in each case that there was “not complete identity of the parties between the current action and the arbitration.”

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