Abondolo v. Jerry WWHS Co.
829 F. Supp. 2d 120
E.D.N.Y2011Background
- Petition seeks confirmation of an arbitration award under FAA §9, LMRA §301, and ERISA §502.
- Respondent West Washington Meats assigned assets for benefit of creditors on April 6, 2011, with an assignee supervising in NY state court.
- Underlying arbitration occurred April 27, 2011; Respondent did not appear; Arbitrator Clarke awarded $5,828.90 to Funds.
- Funds served Respondent via New York Secretary of State; Respondent later challenged assignment as actionable stay effect and service validity.
- Court denied Respondent’s motion to dismiss/vacate and granted petition to confirm the award, with costs awarded to Funds and attorney’s fees denied.
- Assets remain subject to Assignment Proceeding, but confirmation does not interfere with orderly administration; Funds must pursue claims in the Assignment Proceeding
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether service of process was proper | Abondolo/Funds satisfied NY service requirements | Respondent argues improper service via SOS given outdated address | Service via Secretary of State valid under NY law |
| Whether the Assignment for the Benefit of Creditors requires stay/dismissal of the petition | Assignment does not automatically stay proceedings; confirmation viable | Public policy favors staying/centralizing claims in assignment proceeding | No automatic stay; petition not dismissed; not precluded by assignment |
| Whether the arbitrability challenge was preserved and hence enforceable | Arbitrability objections preserved for review on petition to vacate | Objected to arbitrability but did not raise during arbitration | Respondent waived arbitrability challenge; award confirmed |
| Whether the Arbitration Award should be vacated or confirmed; fees and costs | Award should be confirmed; ERISA costs recoverable; fees not automatically recoverable | Award should be vacated due to assignment/public policy considerations | Arbitration Award confirmed; costs awarded to petitioners; attorney’s fees denied |
Key Cases Cited
- D.H. Blair & Co. v. Gottdiener, 462 F.3d 95 (2d Cir. 2006) (deference in confirming arbitral awards; grounds for vacatur under FAA §10)
- Florasynth, Inc. v. Pickholz, 750 F.2d 171 (2d Cir. 1984) (arbitration awards are to be confirmed with limited review)
- National Association of Broadcast Employees & Technicians v. American Broadcasting Co., Inc., 140 F.3d 459 (2d Cir. 1998) (challenge to arbitrability must be raised timely to avoid waiver upon award)
- New York Hotel & Motel Trades Council v. Hotel St. George, 988 F.Supp. 770 (S.D.N.Y. 1997) (considerations in challenging arbitration and staying proceedings)