Cusimano v. Schnurr

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This appeal concerned three commercial agreements entered into among family members regarding family-owned entities. New York residents executed each agreement, and each agreement contained a provision stating that disputes will be settled by arbitration pursuant to the rules of the American Arbitration Association (AAA). This action was commenced in New York County Supreme Court alleging fraud and malpractice against the family’s accountants. The court dismissed the complaint but gave Plaintiffs twenty days to replead certain causes of action with specificity. Plaintiffs subsequently added two family members as respondents and filed a demand for arbitration and a statement of claim with the AAA. Supreme Court granted Defendants’ motion to permanently stay certain claims asserted in the arbitration demand as time-barred and granted Plaintiffs’ motion for a stay pending arbitration to the extent of directing the parties to arbitrate the remaining non-time-barred claims, concluding that the AAA was inapplicable. The Appellate Division reversed, concluding that the AAA applied to the agreements because each concerned transactions that affected commerce and that Plaintiffs did not waive the right to arbitration. The Court of Appeals reversed, holding that Plaintiffs waived the right to arbitration because of their blatant forum-shopping, and the issue of timeliness should be determined by the court. View "Cusimano v. Schnurr" on Justia Law