Zuckerman v CB Richard Ellis Real Estate Servs., LLC

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Zuckerman v CB Richard Ellis Real Estate Servs., LLC 2013 NY Slip Op 30997(U) May 3, 2013 Supreme Court, New York County Docket Number: 653232/11 Judge: Barbara R. Kapnick Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. [*FILED: NEW YORK COUNTY CLERK 05/07/2013 1] INDEX NO. 653232/2011 NYSCEF DOC. NO. 30 RECEIVED NYSCEF: 05/07/2013 SUPREME'COURT OF THE STATE OF NEW YORK NEW YORK COUNTY PRESENT: BARBARA R. KAPNICK PART 6q Justice -------------------------------------~ I I Index Number: 65323212011 ZUCKERMAN, JON INDEX NO. _ _ _ __ VS. MonON DATE _ _ _ __ CB RICHARD ELLIS REAL ESTATE SEQUENCE NUMBER: 001 MonON SEQ. NO. _ __ DISMISS ACTION --~-- ~-"'- -~ ! '--' The following papers, numbered 1 to _ _ , were read on this motion to/for _ _ _ _ _ _ _ _ _ _ _ _ _ __ Notice of Motion/Order to Show Cause - Affidavits - Exhibits Answering Affidavits - Exhibits _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ Replying Affidavits _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ I No(s)._ _ _ _ __ I No(s). _ _ _ _ __ I No(s). _ _ _ _ __ Upon the foregoing papers, It Is ordered that this motion is w o MOTION IS DECIDED IN ACCORDANCE WITH ACCOMPANYING MEMORANDUM DECISION ~ => .., e c w ~ ~ W LL W ~ >~ ...J~ ...J Z =>0 LL f/) t w 3; w ~ f/) - W f/) ~ ~ (!) z ~ 0 ...J ...J « o 0 Z W x o LL I- ~ ~ o ~ 0 LL --~==-1~--tT-~o;;;;;;::=-----' J.S.C. Dated: 1. CHECK ONE: ¢. ¢. ¢ ¢. ¢ ¢ ¢.......... ¢ ¢. ¢ ¢. ¢ ¢.. ¢ ¢. ¢ ¢ ¢.. ¢.. ¢.. ¢ ¢ ¢ ¢ ¢... ¢.... ¢. ¢... ¢.. ¢. ¢ 2. CHECK AS APPROPRIATE: ¢ ¢ ¢ ¢. ¢.... ¢. ¢. ¢.. ¢ ¢. ¢ ¢.. ¢ ¢ ¢ MOTION IS: 3. CHECK IF APPROPRIATE: ................................................ 0 0 0 .0 MBARA R. KAPNICK ~ON:FI~~bSITION CASE DISPOSED GRANTED 0 SEITLE ORDER DO NOT POST DENIED 0 . )¥GRANTED IN PART o SUBMIT ORDER o FIDUCIARY APPOINTMENT 0 OTHER .. 1/, REFERENCE / [* 2] SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: IA PART 39 --------------------------------------x JON ZUCKERMAN, DECISION/ORDER Index No. 653232/11 Motion Seq. No. 001 Plaintiff, -againstCB RICHARD ELLIS REAL ESTATE SERVICES, LLC and KEITH CAGGIANO, Defendants. -------------------------------------x BARBARA R. KAPNICK, J.: In this action, damages of up commissions asserts and CB 1); plaintiff Jon Zuckerman $24 million business causes defendant (Count to of Richard for lost opportunities. action tortious .. Ellis for ("Zuckerman") real brokerage la-Count The estate Complaint constructive Real Estate interference with discharge against Services, LLC ("CBRE") business relationships against both defendants CBRE and Keith Caggiano ("Caggiano") 2) i seeks (Count breach of fiduciary duty against Caggiano (Count 3); aiding and abetting breach of fiduciary duty against CBRE (Count 4) the 575 Fifth Contract against CBRE (Count 5) contract against CBRE (Count agreement against Caggiano both defendants 6); breach (Count 7); i i breach of breach of employment of the partnership unjust enrichment against (Count 8); breach of the implied covenant of good .} faith and fair dealing against CBRE against CBRE (Count 10). (Count 9); and an accounting Defendants CBRE and Caggiano now move to dismiss the Complaint, pursuant to CPLR 3211 (a) (1), (3), (5), and [* 3] (7) . Alternatively, defendants move to compel arbitration, pursuant to CPLR 7503 (a). Background The facts stated herein are taken from the Complaint, unless otherwise specified. In or around 2000, Zuckerman was employed at Jones Lang LaSalle, a financial and professional specializing in real estate services. At the time, services firm Zuckerman had over twenty years of experience in the real estate industry. In or around mid-2000, Caggiano Zuckerman (then 23 years old) Lang LaSalle. (then 46 years old) hired to work primarily for him at Jones This was Caggiano's first job in the real estate industry. In or around late-2000, Zuckerman was recruited to work for Shorenstein, one of the nation's oldest real estate organizations, for the express relationship with purpose of MetLife and developing helping and maintaining Shorenstein retain a its representation of MetLife's building located at 200 Park Avenue ("200 Park"). Over the next six months, Zuckerman negotiated a deal for approximately 300,000 square feet of space within 200 Park that -2- [* 4] initiated a positive repositioning and revaluation of 200 Park, thereby cementing his and Shorenstein's relationship with MetLife. Due to his success, Zuckerman was permitted to hire people for his team at Shorenstein and he hired Caggiano from Jones Lang LaSalle. Three weeks after September 11, 2001, Shorenstein announced that it was exiting the third-party real estate business in New York City and would, therefore, cease to represent MetLife and 200 Park. Soon thereafter, MetLife told Zuckerman that it would follow him to any other real estate brokerage firm at which he became employed if it was one of the few firms that met MetLife's stringent national requirements. Zuckerman interviewed numerous.firms and eventually signed a contract (the "Employment Contract") to become a real estate broker at Insignia. about January Zuckerman Zuckerman began his employment at 2, would 2002. be The MetLife's Employment broker at Insignia on or Contract Insignia provided that and granted Zuckerman the right to a sliding-scale percentage of all MetLife derived revenues received by Insignia. -3- [* 5] Zuckerman made Caggiano his junior partner on or about January 1,2002, and Insignia hired Caggiano at Zuckerman's request. Zuckerman and Caggiano memorialized their business arrangement (the "Partnership Agreement"), which provided that Zuckerman would receive the first $40,000 of any revenue received from business done by him or Caggiano and the remainder was split 60% to In or about February 2003, Insignia was acquired by CBRE. As Zuckerman and 40% to Caggiano. part of the acquisition, Stephen Siegel chairman commercial of Insignia's ("Siegel"), real estate who was the division and represented Insignia in negotiating the Employment Contract with Zuckerman, became the Chairman of Global Brokerage at CBRE. replaced Insignia with respect to the Partnership Agreement without material Employment changes Contract to the CBRE and terms of these contracts. Zuckerman continued to manage 200 Park for MetLife until in or about 2005, when MetLife sold the building. Before then, starting in or around February 2004, Zuckerman spent a significant amount of his time solving a complex insurance issue for MetLife related to 200 Park's status as a potential terrorism target. Zuckerman was not cemented compensated for his efforts, which further and expanded his relationship with MetLife and MetLife's relationship -4- [* 6] with CBRE. To further solidify his relationship with MetLife, Zuckerman promised not to represent any other clients who owned commercial real estate in New York in order to avoid potential conflicts of interest. greater-than-industry Zuckerman claims that his standard ethics formed the "commitment to core of [his] relationship with MetLife and was well known at CBRE." Complaint, 'TI 34. Based on Zuckerman's performance leasing 200 Park Avenue, in or about 2004, Siegel offered Zuckerman the opportunity to be the lead agent for 9 West 57 th Street, one of the City's highest-end buildings commanding the market's highest rents. Zuckerman told Siegel that he had to turn down the offer because of his promise to MetLife to remain exclusive. Siegel told Zuckerman that he thought turning down this potentially lucrative assignment was a mistake because he did not believe 9 West 57 t r. Street conflicted with 200 Park. Zuckerman, however, refused the assignment. maintained position his Between 2005 and 2007, Zuckerman pursued representation of other MetLife buildings in Manhattan, 85 Broad Street and 575 Fifth Avenue. and including CBRE was not awarded the 85 Broad Street assignment because the "downtown brokers" were overly conflicted. and awarded competi ti ve In 2007, however, MetLife executives called Zuckerman him pitch the 575 because Fifth he was Avenue assignment allegedly the without best a "midtown [* 7] broker" in New York City. A contract governing Zuckerman's and CBRE's 575 representation of Fifth Avenue (the "575 Fifth Contract") named Zuckerman as the "exclusive broker" and provided that Zuckerman could not be terminated without MetLife's consent. Pursuant to the Partnership Agreement, Zuckerman ensured that Caggiano was mentioned in the 575 Fifth Contract. In or around late 2008, Caggiano co-broke red a tenant- representation deal with Wells Fargo with respect to a building located at 100 Park Avenue in Manhattan ("100 Park Avenue"). The Wells Fargo business was referred to Zuckerman by a broker in Los Angeles, Caggiano. and Zuckerman introduced the Los Angeles broker to Zuckerman repeatedly asked Caggiano how the Wells Fargo deal was proceeding because, under the terms of the Partnership Agreement, Zuckerman was entitled to a 60% share in the commission from any deal in which Caggiano was involved. Caggiano repeatedly told Zuckerman that the Wells Fargo deal was not going to happen. Zuckerman later discovered that the 100 Park Avenue deal had, in fact, closed in or around late 2008 and Caggiano had breached the Partnership Agreement by not sharing the commission. Zuckerman demanded that Matthew Van Buren then Executive Managing Director, Caggiano. As a result, ("Van Buren"), CBRE's dissolve his partnership with [* 8] In or about January 2009, after hearing from both Zuckerman and Caggiano as part of an internal-dispute resolution proceeding, CBRE (through Van Buren) rendered a decision specifically articulating Zuckerman's and Caggiano's respective entitlement to commissions (the "Decision"). policy. CBRE formalized the Decision as CBRE The Decision divided the accounts Zuckerman and Caggiano had worked on and assigned all of them MetLife - to a single broker. with the exception of The broker who would not be working on the account going forward was entitled to specifically determine compensation for commissions already earned. The Decision also provided that Zuckerman and Caggiano would continue to share the MetLife account and split commissions 60% to Zuckerman and Zuckerman's 40% to Caggiano. partnership was Thus, dissolved although with Caggiano's respect to and other accounts, the partnership was ongoing with respect to the MetLife account. Zuckerman alleges that CBRE refused to dissolve the partnership with respect to MetLife because CBRE did not want to further consolidate further claims that Zuckerman's CBRE knew control that the over the Decision account. would He force Zuckerman to work with someone who had betrayed this trust, and ultimately, put Zuckerman in an untenable professional position. -7- [* 9] The Decision assigned the Wells Fargo account to Caggiano, despi te Caggiano's prior bad relation to that account. fai th dealings with Zuckerman in In addition, Wells Fargo was the only account with commission earned but not paid on which the broker who would not have contact with the client going entitled to a share of those commissions. forward Therefore, was not Zuckerman alleges that the Decision was harmful to him and treated Caggiano more favorably. Zuckerman further claims that in January 2010, he discovered that he had not received payments that were due to him the previous year. After making inquiries with CBRE's accounting department, Zuckerman discovered that, on at least four transactions, Caggiano had diverted commissions shared with Zuckerman. totaled $98,251.66. to These himself that allegedly should diverted have been commissions Zuckerman claims that he notified Siegel about the diverted funds, and after an internal investigation, Caggiano was allegedly required to repay the diverted commissions, which Zuckerman admits he received. Zuckerman claims that Caggiano's conduct constituted ethical violations and breaches of neither fired nor suspended. fiduciary duties, yet Caggiano was Zuckerman requested that Siegel and -8- [* 10] Van Buren refused, remove Caggiano from the MetLife instead moving Caggiano into a account, but they larger office that was closer to Zuckerman's office, which escalated Zuckerman's feeling that CBRE was protecting Caggiano and condoning his behavior. Zuckerman repeatedly requested an explanation from CBRE as to how his funds had been diverted. Zuckerman also requested assurances that the diversion of his commissions could not happen again. CBRE denied or refused to respond to his requests. Zuckerman claims that Caggiano's betrayal provided CBRE an opportunity to realize its long-held ambition of transferring the MetLife account to Caggiano and making it a corporate account of CBRE, rather than Zuckerman's account as an exclusive broker. Ultimately, CBRE told Zuckerman that MetLife could choose between working with Zuckerman or Caggiano, removed from the informed MetLife Complaint, ethical ~ and 87. account. of and that the other would be Zuckerman agreed, Caggiano's "theft but only if CBRE and dishonest dealings." Zuckerman maintains that he could satisfy his fiduciary obligations to MetLife only by removing Caggiano from the account, or by disclosing Caggiano's conduct. CBRE Caggiano's refused to disclose conduct, Zuckerman to hide Caggiano's conduct from MetLife. -9- and instructed [* 11] CBRE's alleged efforts to marginalize Zuckerman continued on March 24, 2010, when Van Buren directed Zuckerman to "'refrain from any direct conversations with the client [MetLife] relating to the Id., staffing of the 575 Agency as I will speak for the firm.'" 90. On or about April 27, purported theft Id., ~ 91. informed as 2010, ~ Siegel referred to Caggiano's "'nothing other than an accounting error.'" Later, on or about June 2, 2010, CBRE's general counsel Zuckerman's counsel that "'CBRE took appropriate corrective actions'" concerning Caggiano's alleged theft, including "'disciplinary action'" and "'effecting internal accounting Id., controls to prevent similar future errors from occurring.'" ~ 92. Zuckerman claims that CBRE's conduct forced him to resign, and that MetLife cannot follow him to his new employer because it is not on MetLife's list of approved real estate brokerage firms. Zuckerman contends that, as a result, CBRE will receive all future commissions from the MetLife account under the 575 Fifth Avenue assignment, tenant, including a lease renewal of the building's largest L'Oreal. The commission on this renewal alone will allegedly be over $18 million, of which Zuckerman would have been entitled to $9 million had he not been forced to resign. claims that he would have participated in several Zuckerman additional transactions had he not been forced to resign from CBRE. -10- [* 12] Discussion On this motion, defendants move, in the alternative, to compel arbi tration, Employment based upon an arbitration clause Agreement. Zuckerman counters contained in the that the arbitration clause does not cover his tort claims; that a substantial basis for his claims stems from the 575 Fifth Ave Agreement, which does not contain an arbitration clause; and that Caggiano cannot invoke the arbitration clause. Although defendants' motion to compel arbitration is presented as alternative relief, once the Court has determined the threshold issues of the existence oi a valid agreement to arbitrate, whether arbitration has been complied with, and whether the claim sought to be arbitrated would be time-barred were it asserted in state court, the remaining issues are for the arbitrator. CPLR 7503 (a), 7502 (b); Matter of Smith Barney, Harris Upham & Co. v Luckie, 85 NY2d 193, 201-202 (1995); Board of Educ. of Patchogue-Medford Union Free School Dist. v Patchogue-Medford Congress of Teachers, 48 NY2d 812, 813 (1979) arbitrated (once it has been determined that the claim sought to be is properly before the arbitrator and that the arbitration of the dispute is not against the public policy of this State, any "further consistent arbitration with New judicial inquiry is York's "strong foreclosed"). public policy This is favoring as a means of conserving the time and resources [* 13] of the courts and the contracting parties," and "interfer[ing] as little as possible with the freedom of consenting parties to submit disputes to arbitration." Stark v Molod Spitz DeSantis & Stark, p.e., 9 NY3d 59, 66 (2007) (internal quotation marks and citations omitted) . Paragraph 11(c) (Arbitration Clause) of the Agreement specifically provides that: [a] ny dispute arising out of or relating to this Agreement, the employment of Broker by the Company, or the termination of such employment, including, but not limited to, claims involving laws against discrimination brought under federal and/or state law, and/or claims involving co-employees (but excluding worker's compensation claims), which has not been resolved by a non-binding procedure as provided herein within 90 days of the Notice, except as provided in Section 3 (b) (ii) (0), shall be resolved by binding arbitration in New York, New York (or such other location as may be mutually agreed upon) in accordance with the rules of J-A-M-S/Endispute applicable to employment arbitration (the "Rules") as then in effect. Other than with respect to equitable relief (which may be sought in aid of arbitration by either party), neither party shall be entitled to commence or maintain any action in a court of law with respect to any matter in dispute or relief required until such matter or request for relief shall have been submitted to and decided by the chosen arbitrator and then only for the enforcement of the award of such arbitrator. The decision of the arbitrator shall be final and binding upon the parties and all persons claiming under and through them. -12- Employment [* 14] Section 3 (b) (ii) (D) of the Employment Agreement provides that commission disputes between brokers "shall be determined as between the affected employee(s) by binding arbitration in accordance with the then current Company policies and procedures governing internal arbitration between salespersons." and among its commissioned brokers and Under this section, this "binding" internal company arbitration "survive[s] termination" of the Employment Agreement. Here, to" the all of Zuckerman's claims "aris[e] out of or relat[e] Employment Agreement, Zuckerman's and/or the termination of his employment. 11 (c). employment at CBRE, Employment Agreement, § Indeed, the focal point of all of Zuckerman's claims is the payment of brokerage commissions, which is central to the Employment Agreement and Zuckerman's employment with CBRE. Nonetheless, Zuckerman argues that "[i]t is well settled that a party cannot be compelled to submit to arbitration unless the agreement to arbitrate expressly and unequivocally encompasses the subject matter of the particular dispute." Corp. v Home Ins. 99 NY2d omitted). 511 Co., (2003) Gerling Global Reins. 302 AD2d 118, 123 (1 st Dept 2002), (internal quotation marks and lv den. citations However, Zuckerman's tort claims are directly related to his alleged lost commissions and his employment dispute with CBRE, thereby establishing a "reasonable relationship" between the tort -13- [* 15] claims and the underlying contract dispute. Gen. Ins. Co. v Investors Ins. ("[o]nce it appears that Co. of Am., there is, or Matter of Nationwide 37 NY2d 91, is not a 96 (1975) reasonable relationship between the subj ect matter of the dispute and the general subject matter of the underlying contract, the court's inquiry is ended"); see also Brandle Meadows, LLC v Bette, 84 AD3d 1579, 1581 (3d Dept 2011) (compelling arbitration of tort claims of tortious interference and defamation, where there was a reasonable relationship to the underlying contract). In support of his argument that the 575 Fifth Ave Agreement does not contain an arbitration clause, Zuckerman cites to the case of Home Ins. Co. 1995) involved which v Tokyo Mar. a & Fire Co., 221 AD2d 592 dispute between manufacturer of a photocopy machine. issue contained provision, an whereby arbitration the a (2d Dept distributor and The distribution agreement at clause distributor and agreed an indemnification to indemnify manufacturer under certain warranty related circumstances. the manufacturer's separate insurance policy, distributor was named as an additional insured. insurance against carrier thus the manufacturer's indemnification. to commenced a arbitration a declaratory insurance company the Under however, the The distributor's judgment on the action issue of The trial court directed the parties to proceed under the distribution -14- agreement. The Second [* 16] Department policy reversed, naming the holding that distributor the as manufacturer's an additional insurance insured "was separate and distinct from the indemnification clause contained in the [distribution] agreement. . , and, thus, not encompassed by the arbitration clause in the agreement." The Home Ins. Co. Id. at 593. case involved two distinct distribution agreement and an insurance policy, contracts, a and the parties' separate indemnification rights under those agreements, while here, to the extent Agreement, Zuckerman's they all claims relate harken back to arrangement with CBRE, the to scope his purported lost employment dispute with CBRE. the 575 Fifth Ave of his brokerage commissions, None of Zuckerman's and his allegations concerning the 575 Fifth Ave Agreement fall outside the scope of the Employment Agreement or Zuckerman's termination. Home Ins. Co. Therefore, is distinguishable on its facts. Zuckerman's next argument that Caggiano cannot arbitration is based upon Zuckerman's assertion that, invoke under the Employment Agreement, CBRE's internal "binding arbitration" applies only to disagreements concerning "each employee's percentage of the gross commission," which is not the subj ect of this lawsuit. Plaintiff's Opp. Brief, at 25, citing Employment Agreement, -15- § 3 (b) [* 17] (ii) (D). Zuckerman also claims that Caggiano is not a third-party beneficiary of the Employment Agreement. "Under New York law, the right to compel arbitration does not extend to a party that has not signed the agreement pursuant to which arbitration is sought unless the right of the nonsignatory is expressly provided for in the agreement." Co. v 298 Rankin, AD2d 263, 263 (lst Greater N.Y. Mut. Dept 2002). Here, Ins. the Employment Agreement provides that "[a]ll disputes arising out of or relating to this Agreement, the employment of Broker by the Company or the termination of such employment, including . claims involving co-employees" are to be resolved by arbitration, "except where this Agreement Company arbitration as Agreement, claims in Section 3 11 (emphasis added). § do not seek to procedure under section 3 dispute with Caggiano, under section 11 Moreover, bound otherwise under Specifically, a invoke (b) (b) provides (ii) for (D)." internal Employment Zuckerman's assertion that his CBRE's (ii) (D), "co-employee," "internal arbitration" necessarily renders his subject to arbitration (c) of the Employment Agreement. a nonsignatory to an arbitration agreement may be theories a of, signatory among others, to arbitration an estoppel and agreement agency. can be compelled to arbitrate claims with a nonsignatory "where a careful -16- [* 18] review of the relationship among the parties, . , signed that the the contracts they and the issues that had arisen among them discloses issues the nonsignatory is seeking to resolve in arbitration are intertwined with the agreement that the estopped party has signed." Mis c 3 d 3 91 , 396 Merrill Lynch Intl. Fin., Inc. v Donaldson, 27 ( S up Ct , NYC 0 2010 ) ( in t ern a 1 quo tat ion rna r k s omitted), citing Denney v BDO Seidman, LLP, 412 F3d 58, 70 (2005); JLM Indus. v Stol t-Nielsen SA, 387 F3d 163, 177 (2d Cir 2004). Here, the claims against Caggiano are intertwined with the issues raised in Zuckerman's Employment involving Agreement employment itself co-employees. dispute requires with CBRE, arbitration given Furthermore, the and of the claims intertwined "employment-related nature of the claims," Caggiano, as an agent of CBRE, "is entitled to demand arbitration of the claims against him no less than [CBRE] is entitled to demand arbitration of the claims against it." DiBello v Salkowitz, 4 AD3d 230, 232 (1 st Dept 2004). The Court is cognizant of defendants' argument that they are enti tied invoking, matter." to test the sufficiency and without waiver of, of their the Complaint right Defendants' Opening Brief, at 25. "prior to to arbitrate this In essence, defendants initially seek dismissal of each cause of action, and then seek to compel arbitration of any surviving claims. The cases cited by defendants in support of this argument hold that, -17- by moving to [* 19] dismiss, a arbitrate. right to defendant does not necessarily waive the right to This is consistent with the legal principle that the arbitrate, like any other modified, waived, or abandoned." contractual right, "may be Sherrill v Grayco Bldrs., 64 NY2d 261, 272 (1985). However, the cases cited by defendants focus on whether waived a party litigation to such an the right extent 'clearly inconsistent with as to arbitrate to "manifest[] [that party's] by engaging a in preference later claim that the parties were obligated to settle their differences by arbitration' and thereby elected to litigate rather than arbitrate." Id. These cases focus on protective procedural measures - answers, affirmative defenses, would be counterclaims, deemed waived if the courts permit therefore, not motions raised such by to the measures dismiss - that defendants, and, without waiving arbitration rights. For example, in Singer v Seavey, 83 AD3d 481 (lst Dept 2011), the trial court denied the defendants' motion to dismiss and their motion to compel arbitration. The First Department reversed, granting the motion to compel arbitration and otherwise staying the proceedings pending arbitration. The Court held that the "[d]efendants did not waive their right to arbitrate by moving to dismiss the complaint and appealing from the partial denial of the motion." Id. at 482. In Singer v Jeffries & Co., 78 NY2d 76, 85- [* 20] 86 1991), the Court of Appeals held that the "defendants timely asserted their right to arbitrate and that their preliminary and minimal resort to court for relief should not be viewed as an abandonment of their right to enforce the arbitration agreement." See also Matter of Haupt v Rose, 265 NY 108 (1934); MCC Dev. Corp. v Perla, 23 Misc 3d 1126(A), (lst Dept 2011), (Sup Ct, NY Co 2009), affd 81 AD3d 474 lv den. 17 NY3d 715 (2011). None of these cases expressly endorse the practice of litigating the case in Court, with a result of partial dismissal, and then sending any surviving claims to arbitration. Therefore, to the extent defendants request that the Court rule first on that portion of the motion which seeks a dismissal of the Complaint pursuant to various sections of CPLR 3211, that request is denied. Under CPLR 7502 (b) and 7503 (a), however, the Court may rule on the statute of 1 imi ta tions, as a threshold issue, determining the parties' right to compel arbitration. a prior arbitration award is "complete, prior to Moreover, as final and binding . even if the prior award was never judicially confirmed" (Motor Veh. Acc. Indem. Corp. v Travelers Ins. Co., 246 AD2d 420, 422 [1 st Dept 1998] [internal quotation marks and citations omitted]), res judicata is also a threshold issue that must be resolved by the Court. (lst Matter of Cine-Source, Inc. Dept 1992). -19- v Burrows, 180 AD2d 592, 593 [* 21] Here, defendants seek dismissal of Zuckerman's allegations that CBRE failed to pay commissions under the Employment Agreement (Complaint, <j[ 142), and that Caggiano breached his commission- sharing agreement with Zuckerman by hiding the transaction with Wells Fargo, stealing commissions, undermining Zuckerman at MetLife, and conspiring with CBRE to replace Zuckerman as MetLife's exclusi ve broker. Id., 147. <j[ Defendants argue that these allegations were resolved by CBRE's internal dispute resolution procedures, referred to in the Employment Agreement as "binding arbitration." also argue Employment Agreement, that, pursuant § 3 (b) to CPLR 7510 (ii) (D). and 215 (5), Defendants Zuckerman failed to bring a confirmation proceeding or an enforcement action within the required one year statute of limitations. 7511 (a) See also CPLR (" [aJ n application to vacate or modify an award may be made by a party within ninety days", .. )" However, Zuckerman's allegations herein include conduct that occurred after CBRE issued its internal arbitration decision in January 2009. For instance, the Complaint alleges that in January 2010, Zuckerman discovered that he had not received payments that were due to him in 2009 "with respect to at least four deals," including One Beacon Insurance, MS Foundation for Women, El Diario, and American International Realty, which the Complaint refers to as the "One Metro Tech" account. Complaint, -20- <j[<j[ 61-63. None of these [* 22] transactions are mentioned in CBRE's internal arbitration decision, or in Zuckerman's pre-arbitration list of "accounts/relationships" in which he and Caggiano had a common interest. G and H. Exs. According to Zuckerman, diverted by CBRE and Caggiano. Kasowi t z Aff., these four payments were Complaint, ~~ 62, 66-68. Zuckerman concedes that he "eventually received the funds stolen by Caggiano" (id., ~ 71), presumably on the four transactions identified above, but Zuckerman claims that he was harmed by the late payment of these funds, and the pleading suggests that additional funds may have been diverted, which can be verified only by an accounting. Thus, it appears that the misconduct now alleged by Zuckerman occurred after the internal CBRE arbitration, and falls outside the scope of CBRE's arbitration decision. Therefore, these allegations would not be time-barred based upon Zuckerman's failure to bring a confirmation proceeding or an enforcement action within one year of CBRE's internal arbitration. at 594 (" [a]lthough Matter of Cine-Source, Inc., 180 AD2d respondent's claims contract, the act comprising a breach arise under the same had not yet occurred at the time of the hearing and, therefore, no cause of action for its breach had accrued"). judicata, because Nor would these allegations be barred by res "[p] arties to an arbitration proceeding are barred by the doctrine of res judicata from relitigating only those matters which were actually contested and therefore determined by -21- [* 23] the award." (where parties "seek to litigate an issue not Id. determined by the arbitrator, the award is not a bar to subsequent proceedings") . at 595. Id. In any event, to the extent that factual issues exist with respect to defendants' alleged misconduct that occurred after the internal CBRE arbitration, extent to which it the timing of that was incorporated into conduct, and the CBRE's internal arbitration decision of January 2009, if at all, these issues are reserved for the arbitrators, "who may, in their sole discretion, apply or not Aerospace v 2002) apply the CPLR bar." Advanced Exec. Aircraft, 7502 (b); see 292 AD2d 201, also 201 Lucas (lst Dept ("res judicata and the applicable statutory time limitations were properly referred to the arbitrators, in light of the parties' broad arbitration clause"). Accordingly, it is hereby ORDERED that the defendants' motion to compel arbitration is granted, and the motion is otherwise denied; and it is further ORDERED that plaintiff Jon Zuckerman shall arbi trate his claims against defendants CB Richard Ellis Real Estate Services, LLC and Keith Caggiano in accordance with the Employment Contract at issue herein; and it is further -22- [* 24] ORDERED that all proceedings in this action are hereby stayed pending the determination of the arbitration, except for an application to vacate or modify said stay; and it is further ORDERED that either party may make an application by Order to Show Cause to vacate or modify this stay upon the determination of the arbitration. This constitutes the decision and order of this Court. Date: May 2i , 2013 Barba -23- . apnlck J.S.C. final

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