“Second Circuit: Investment Advisor Not Covered by Plaintiff’s Employment Arbitration Agreement”

René Thorne and Stacey Cerrone of Jackson Lewis authored this article in The National Law Review discussing the Second Circuit’s recent decision in Cooper v. Ruane Cunniff & Goldfarb Inc., in which the appellate panel in a 2-1 decision reversed a lower court order compelling arbitration of an employee’s claims against the investment advisor of his employer’s profit-sharing plan. Although the plaintiff and his employer were parties to an agreement “to arbitrate all legal claims ‘relating to, his employment,” the Second Circuit held that plaintiff’s claims of breach of fiduciary duty against the investment advisor were not subject to the advisor’s motion to compel arbitration under equitable estoppel, because the claims did not “relate to” plaintiff’s employment. As the court explained, that the claims “turned ‘entirely’ on [defendant’s] investment decisions and had ‘no connection’ to [plaintiff’s] work performance, evaluations, treatment by supervisors, his compensation, or the condition of his workplace.”