In Allen v. Wework Companies, Inc., No. 155130/2020, 2021 WL 2432204 (N.Y. Sup Ct, New York County June 10, 2021), a sexual harassment case, the court granted the defendant’s motion to stay this action and compel arbitration.
The court summarized defendant’s position as follows:
In support of the motion, defendant notes that, contemporaneously with the commencement of his employment, plaintiff signed an arbitration agreement on October 13 2017 (Arbitration Agreement). Defendant notes that the Arbitration Agreement provides a multiple-step dispute resolution program of covered claims, which ends with binding arbitration. Defendant asserts that the covered claims specifically include claims arising under NYSHRL NYCHRL, and NYLL. Defendant also asserts that the Arbitration Agreement gives the arbitrator the authority to decide issues of arbitrability. Defendant further asserts that the Arbitration Agreement provides that the Federal Arbitration Act (FAA) “shall govern the interpretation, enforcement, and all proceedings pursuant to this Agreement” Based hereon, defendant contends that the FAA governs the Arbitration Agreement, the Arbitration Agreement is enforceable, plaintiff’s claims fall within the scope of the Arbitration Agreement, and, as a result, the Court should direct the parties to proceed to arbitration. Defendant acknowledges that CPLR 7515 purports to prohibit agreements compelling arbitration of discrimination claims. However, defendant contends, among other things, that CPLR 7515 does not apply retroactively and, as such, has no bearing on the enforceability of the instant Arbitration Agreement, which was executed prior to the effective date of the statute.
In response, plaintiff argued that the FAA does not apply because the Arbitration Agreement is not a transaction involving interstate commerce, that CPLR 7515 and long-standing public policy prohibit mandatory arbitration involving discrimination claims, and that the Arbitration Agreement, which contains a New York choice of law provision, expressly provides that it will be governed by the laws of New York and not the FAA.
Here is the court’s analysis, considering the parties’ positions:
The threshold dispute is one of arbitrability; specifically, whether the parties agreed to submit to arbitration the particular claims raised in this action. The question of arbitrability is an issue for the Court, unless the parties clearly and unmistakably provide otherwise (see Steyn v CRTV, LLC, 175 AD3d 1, 10 [1st Dept 2019], citing AT & T Tech., Inc. v Communications Workers of Am., 475 US 643, 649 ).
Here, the Arbitration Agreement provides that it “shall be governed by and shall be interpreted in accordance with the laws of the State of New York, unless otherwise agreed to by the Parties.” The Arbitration Agreement further provides that:
“The Arbitrator, and not a court, shall have exclusive authority to resolve any dispute relating to the interpretation, applicability, enforceability or formation of this Agreement, including without limitation disputes regarding the procedural or substantive arbitrability of any claim, any objections with respect to the existence, scope or validity of the Agreement, and any claim that all or any part of this Agreement is void or voidable.”
It is well settled that “[a]rbitration is a matter of contract, and a party cannot be forced to arbitrate a dispute that it did not expressly agree to submit to arbitration” (Steyn v CRTV LLC 175 AD3d 1, 10 [1st Dept 2019]). In interpreting a contract under New York law the intent of the parties governs, words and phrases are given their plain meaning and the contract construed to give the full meaning and effect to its provisions (see Am Exp Bank Ltd v Uniroyal, Inc., 164 AD2d 275, 777 [1st Dept 1990]). After applying these principles, should the agreement appear complete, clear and unambiguous on its face its interpretation is a matter of law and the Court must enforce it according to its terms (id.; Condor Capital Corp. v CALS Inv’rs, LLC, 179 AD3d 592 [1st Dept 2020]).
Based on this, the court held that the parties’ arbitration agreement manifests their “clear and unmistakable intent to submit questions of arbitrability to the arbitrator,” and, therefore, granted defendant’s motion to stay the action and directed the parties to proceed to arbitration.