Court Opinion

ID: 5874253
Source: CourtListenerOpinion
Date Created: 2022-01-13 01:54:56.599445+00
Date Added: 2024-06-11T08:44:48.211622
License: Public Domain

Murphy, P. J.
(dissenting). In 1978, at a time when he owned 80% of Advertising Distributors of America (ADA), plaintiff Harris entered into a shareholder’s agreement with defendants Iannaccone and Peck among others. The agreement contained a broad arbitration clause requiring that “[a]ny differences, disputes or disagreements arising between the parties to the Agreement concerning either the subject matter or any business *432matters pertaining to [ADA] * * * shall be determined by arbitration”. At the time of his termination, Harris’ holding in this closely held company had dwindled to 40%, and it was the combined 52% holding of Iannaccone and Peck which weighed most heavily in the board of directors decision to force Harris out of the day-to-day operations of ADA. The relationship between the defendants and the plaintiff is not that of employer-employee as contemplated by the Human Rights Law (Executive Law § 290 et seq.) but of coshareholders. As such, the provisions of the shareholder’s agreement relating to arbitration should govern. To hold otherwise is to inject the provisions of the Human Rights Law into what are essentially boardroom disputes between coequals. It also leads to the logically anomalous situation here presented where the plaintiff has refused to name his true employer, ADA, as a defendant because 40% of any recovery against ADA would “come out of his own pocket as a shareholder.” It must follow that plaintiff was 40% responsible for his own allegedly discriminatory firing.
Asch and Bloom, JJ., concur with Kupferman, J.; Murphy, P. J., dissents in an opinion.
Order, Supreme Court, New York County, entered on August 1, 1984, modified, on the law, so as to sever the two causes of action, and to stay the second cause of action for injury to business reputation, pending determination of the discrimination action and otherwise affirmed, without costs and without disbursements.