United States / 29 May 1996 / United States, U.S. District Court, Southern District of New York / R3 Aerospace v. Marshall of Cambridge Aerospace Ltd. / 96 Civ. 1171 (WCC)
Country | United States |
Court | United States, U.S. District Court, Southern District of New York |
Date | 29 May 1996 |
Parties | R3 Aerospace v. Marshall of Cambridge Aerospace Ltd. |
Case number | 96 Civ. 1171 (WCC) |
Applicable NYC Provisions | I | II | I(3) | II(1) |
Languages | English |
Summary | R3 Aerospace, Inc. (“R3”) and Marshall of Cambridge Aerospace Ltd. (“Marshall”) entered into a joint venture agreement. A dispute arose and arbitration was commenced pursuant to a clause contained in the agreement, providing for arbitration under the Rules of the American Arbitration Association. R3 commenced a Special Proceeding in the Supreme Court of New York seeking to disqualify a law firm from representing Marshall in the arbitration proceedings, alleging violations of professional conduct. Marshall removed to federal court pursuant to Section 205 of the Federal Arbitration Act (“FAA”), arguing that the state court proceedings related to an arbitration agreement which fell under the NYC. R3 filed a motion to remand back to state court, contending that the NYC did not apply to disqualification proceedings, and therefore, the state court action did not relate to an arbitration agreement falling under the NYC. The United States District Court for the Southern District of New York granted the motion to remand the case to state court. In so ruling, it noted that pursuant to Article I(3) NYC, the NYC only governs disputes that are “commercial” in nature and that the dispute between the parties was not a commercial dispute eligible for removal jurisdiction under the NYC and the FAA. It further found that in accordance with Article II(1)NYC, the NYC does not apply to non-arbitrable disputes such as state court proceedings to disqualify counsel from an arbitration proceeding. It thereby concluded that the removal clause of the FAA could not serve as the basis of its jurisdiction. |
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Attachment (1)
Original Pending Adobe Acrobat PDF |