Modeling Agency’s Early Victory in Dispute Over Alleged Fashion Model Poaching Proves Pyrrhic Due to Failure to Commence Arbitration On Time

In the 2001 film Zoolander, male model Derek Zoolander mused, while giving the “eugoogly” at the funeral for three deceased model friends, that a “model’s life is a precious, precious commodity.” 

Apparently, that view is shared by New York-based talent agencies Elite Model Management (“Elite”) and Men Women N.Y. Model Management (“MWNY”).  The two are currently locked in a heated dispute over Elite’s alleged poaching of MWNY’s fashion models.  MWNY alleges that when several of its employees left to join Elite, they conspired to and did steal some of MWNY’s talent, in violation of non-solicitation provisions in their employment agreements.

Last August, the Supreme Court, New York County, granted MWNY’s motion for a preliminary injunction prohibiting such poaching pursuant to CPLR 7502(c), which authorizes courts to award provisional relief “in connection with an arbitration that is . . . to be commenced” where “the award to which the applicant may be entitled may be rendered ineffectual without such . . . relief.”  However, the party seeking provisional relief must commence the arbitration within thirty days of receiving it; otherwise, the provisional relief expires and becomes null and void. 

Although the former MWNY employees’ contracts were undisputedly subject to mandatory arbitration, MWNY never commenced arbitration, and, accordingly, last November the Supreme Court issued an order vacating the injunction.

MWNY appealed, and, on May 21, 2020, the First Department affirmed in a brief one-page opinion.[1]  The First Department explained that although the employment agreements provided for provisional injunctive relief, the purpose of the injunctive relief clauses was simply to streamline the arbitration process, meaning the clauses did not create an independent entitlement to injunctive relief.  To maintain the preliminary injunction, MWNY had to commence arbitration within thirty days, and it missed the boat and could not show good cause for why it did so.  The preliminary injunction was therefore properly vacated, the court ruled.

The First Department’s decision in the Elite-MWNY dispute is a cautionary tale to parties who obtain an order granting provisional relief under CPLR 7502(c) in the Commercial Division: unless you plan to commence arbitration within 30 days of obtaining the relief, your victory may ultimately prove pyrrhic.

By Benjamin F. Jackson and Muhammad U. Faridi