Summary
In Pacer/Cats/CCS v MovieFone, Inc. (226 AD2d 127, 128 [1st Dept 1996], the First Department merely affirmed the grant of defendants' motion to stay the action pending resolution of a parallel arbitration proceeding between defendants and a third party, because the non-signatory plaintiff in the action was closely related to the signatory parties in the arbitration and the two sets of proceedings raised interwoven issues.
Summary of this case from Tratado De Libre Comercio, LLC v. Splitcast Tech. LLCOpinion
April 2, 1996
Appeal from the Supreme Court, New York County (Robert Lippmann, J.).
This action, brought by the successor to Pacer Cats Corporation, seeks a declaration that the February 14, 1992 agreement, setting forth the respective rights of defendants MovieFone, PromoFone and TTC and Pacer Cats Corporation as well as their successors in interest, is void and that the plaintiff was not a party or otherwise bound by that agreement ( see, Janmort Leasing v. Econo-Car Intl., 475 F. Supp. 1282, 1292). The IAS Court properly stayed this action pending resolution of a New York arbitration since plaintiff is closely related to the signatories of the agreement containing a broad arbitration clause; since the issues raised in the Pacer/Cats/CCS litigation, involving the enforceability of the agreement, are closely related to the issues raised in the arbitration ( see, Strain Son v. Baranello Sons, 90 A.D.2d 924), and since the issues in the overall dispute between the contracting parties are "inextricably interwoven" with the claims raised by the non-signing plaintiff ( Berg v. Dimson, 151 A.D.2d 362, 363, lv denied 75 N.Y.2d 703; see also, Lawson Fabrics v. Akzona, Inc., 355 F. Supp. 1146, 1151, affd 486 F.2d 1394).
The IAS Court correctly determined that plaintiff lacked standing to assert that the February 1992 agreement was void as usurious, and therefore not subject to arbitration, since plaintiff is statutorily precluded by General Obligations Law § 5-521 from raising usury, either affirmatively or as a defense ( Intima-Eighteen, Inc. v. Schreiber Co., 172 A.D.2d 456, 457, lv denied 78 N.Y.2d 856).
We have considered plaintiff's remaining arguments and find them to be without merit.
Concur — Milonas, J.P., Ellerin, Rubin, Ross and Mazzarelli, JJ.