A recent decision from Monroe County Commercial Division Justice Daniel J. Doyle in Stuver v Greenlight Parent, L.P. demonstrates that arbitration clauses cannot be used as an automatic “get-out-of-court-free” card at the pre-answer, motion-to-dismiss stage. While arbitration clauses are enforceable contractual tools, courts still have the authority to determine whether a dispute falls within the scope of the arbitration clause and whether the necessary procedural steps have been followed before dismissing a lawsuit or sending the case to an arbitral forum under such clauses.
In Stuver, Plaintiff served as Defendant Greenlight Parent, L.P.’s (“Greenlight”) (collectively, the “Parties”) Vice President of IT and Software Development until his resignation in January 2024. Between 2022 and 2023, Plaintiff received fully vested profit and equity interests pursuant to Greenlight’s Equity Plan (the “Agreement”). In April 2025, Greenlight notified Plaintiff that his equity interests were forfeited for failure to provide 90 days’ written notice of resignation. Plaintiff asserted that he resigned for “good reason” due to intolerable working conditions, making the forfeiture improper under the Agreement.
Plaintiff then filed an action for breach of contract, breach of the covenant of good faith and fair dealing, and constructive discharge. Greenlight moved pre-answer, arguing that the case should be dismissed under CPLR 3211(a)(1) and (a)(2), and claiming that the documentary evidence showed the court lacked subject matter jurisdiction because Plaintiff had not first used the dispute-resolution procedures outlined in the Agreement before commencing the lawsuit…