Commercial Division Blog: Current Developments in the Commercial Divisions of the New York State Courts

On December 4, 2024, Justice Joel M. Cohen granted a motion to compel arbitration against a plaintiff despite the plaintiff’s claim that it had been fraudulently induced to enter into the contract containing the arbitration clause. In Selim 730 LLC v. SHVO 730 LLC, et al., Index No. 653193/2024, the plaintiff asserted that the defendants induced it to enter into a 2021 settlement agreement by deliberately misstating the amount of certain ownership interests of a joint investment vehicle that was the subject of a dispute between them. After the plaintiff sued, the defendants submitted to the Court an agreement in which the plaintiff released all its claims concerning the settlement agreement and agreed to arbitrate any claims arising out of it. Although the plaintiff contended that it was fraudulently induced to enter the agreement, the Court granted the defendants’ motion to compel arbitration. It explained: Read More

On October 3, 2024, Justice Joel M. Cohen denied a motion to stay arbitration brought by an employee against his former employer, holding that the employer’s decision to seek urgent protective relief from the Court did not waive its right to arbitrate. In Jason Owen v. Array U.S. Inc., et al., Index No. 651471/2022, Jason Owen asserted claims for breach of contract in court against his employer, Array, based upon alleged wrongful termination and denial of compensation. During the briefing of a motion to dismiss in the case, Owen filed several documents on the public docket that Array moved to seal as confidential. The Court granted the sealing motion. Array then initiated a JAMS arbitration proceeding, claiming that Owen had misappropriated confidential information that had been publicly disclosed in the court filings. Owen responded by moving to permanently stay the arbitration on the ground that Array had waived its right to arbitrate. Read More

In an order dated June 11, 2024, Justice Joel M. Cohen confirmed an arbitration award under CPLR 7510, rejecting respondent’s argument that the award was deficient for failing to resolve a counterclaim by an affiliate with common management. The case is Royalty Coffee Beans LLC v. H&H Coffee Group Export Corp., Index No. 655425/2023. Read More

On July 5, 2024, Justice Margaret A. Chan granted a motion to compel arbitration and elected to stay, rather than dismiss, claims brought by a non-signatory to the arbitration agreement. Berley v. Walter & Samuels, Index No. 653205/2023. Read More

On May 31, 2024, Justice Melissa A. Crane declined to dismiss part of a petition to vacate an arbitration award where that award “punted” certain disputes between the parties to a corporate board of trustees. In Naftali Rotenstreich, Chabad of Gramercy Park v. Shaya Lesches, YJP Foundation, Inc., Index No. 655503/2023, the Court granted a motion to dismiss only to the extent the petition challenged the arbitral panel’s rulings on the merits of the dispute. However, the Court found that the part of the award that referred “[a]ll disputed issues regarding salaries, conflicts of interest(s), involving the employees and creditors of [the corporate respondent]” had “defeated most of the reason for the arbitration in the first place.” The Court explained: Read More

On March 6, 2024, Justice Joel M. Cohen of the New York County Commercial Division issued a decision in Dembicki v. Synergy Health Network, Inc., 2024 NY Slip Op 30704(U), granting Defendants’ motion to dismiss for lack of personal jurisdiction. The Court held that the parties’ agreement to New York law, and to an arbitration clause requiring arbitration of the parties’ claims in New York, was insufficient to create personal jurisdiction over Defendants, who otherwise had no connection to New York. The Court explained: Read More

On January 14, 2024, Justice Margaret A. Chan denied a motion to vacate an arbitral award brought by a party that had previously moved to compel arbitration in the first place. The decision in Skyline Steel, LLC v. PilePro LLC, et al., Index No. 650531/2015, noted that petitioner Skyline Steel had first initiated the matter by moving to stay arbitration. Respondent PilePro opposed that motion and successfully cross-moved to compel arbitration. The parties then proceeded to arbitration under JAMS Expedited Procedures. However, after PilePro lost in arbitration and was forced to pay costs and fees, it returned to court with a motion under CPLR 7511 to vacate the arbitral awards, arguing among other things that the arbitration panel exceeded its authority. The Court rejected that motion, finding that the arbitration panel had carefully considered the evidence, made logical rulings, and acted within its authority when it awarded Skyline more than $200,000 in fees and costs. The Court explained, in part: Read More

In a Decision and Order, dated June 21, 2023, in Employers Ins. Co. of Wausau v. Dominion Ins. Receivable LLC, NY Slip Op. 32097(U), Justice Margaret Chan granted Respondents’ cross-motion to compel arbitration and denied Petitioner’s motion to stay arbitration. The Court explained: Read More

On June 23, 2023, Justice Robert R. Reed of the New York County Commercial Division issued a decision in Grayco Alternative Partnership II, LP v. 5 Stone Green Capital LLC, 2023 N.Y. Misc. LEXIS 3024. The Court granted Plaintiff’s motion pursuant to CPLR 7510 to confirm an arbitration award in their favor, finding that the Defendants had failed to meet their “heavy burden” necessary to vacate the award. The Court explained: Read More

In an Opinion, dated May 2, 2023, in Surgical Specialists of Greater N.Y. v. Aetna, Inc., 2023 NY Slip Op 31479(U), Justice Barry R. Ostrager granted defendants’ motion to compel arbitration. The Court explained: Read More

On March 28, 2023, Justice Joel M. Cohen of the New York County Commercial Division issued a decision in FFS Data Corp. v. the OLB Group, Inc., 2023 N.Y. Misc. LEXIS 1377. The Court denied the defendant’s motion to compel arbitration based on a dispute resolution provision contained in an asset purchase agreement between the parties. The Court noted that the provision in question “is a marvel of linguistic misdirection”, but ultimately determined that the defendant “has not carried its burden of establishing that the parties had a clear, explicit and unequivocal agreement mandating that they arbitrate disputes arising out of the APA.” The Court explained: Read More