Respondent Jacob Fetman ("Fetman" or "respondent") moves, pursuant to CPLR § 5015(a)(2) and (a)(3), based upon purportedly newly discovered evidence, to vacate the judgment entered in the Office of the Kings County Clerk on October 7, 2014 (the "Judgment") upon this Court's decision and order, dated September 29, 2014 (the "Prior Decision"), which confirmed the arbitration award of December 17, 2013 (the "Award"). Fetman also moves, pursuant to CPLR § 2221(e), to renew respondent's January 3, 2014 cross-motion seeking to vacate the Award and in opposition to petitioner's December 24, 2013 order to show cause seeking confirmation of the Award, based upon newly discovered evidence. Respondent further moves, pursuant to CPLR § 2221(f), to renew and reargue respondent's order to show cause, dated [*2]December 16, 2014, based upon overlooked law and facts, as well as newly discovered evidence. The Court granted leave to renew and reargue on April 23, 2015, however, upon renewal and reargument, respondent's motion is denied in its entirety.

This matter arises from a Beis Din arbitration that was conducted by Rabbi Dovid Cohen ("Cohen" or the "Arbitrator") between Aish Hatorah New York, Inc. ("Aish" or "petitioner'), a New York non-profit corporation, and respondent, who was Aish's chief financial officer for 17 years. Four arbitration sessions were conducted between October 13 and December 9, 2013. Aish asserts that the parties initially agreed to arbitrate two issues relating to whether Fetman should bear personal responsibility for improperly entering into a lease extension for the property occupied by Aish and relating to Fetman's liability to Aish for making unauthorized loans from Aish. It appears to be undisputed that it was Fetman who initially contacted Cohen to arbitrate the parties' dispute. At the first session of the arbitration, held October 13, 2013, Fetman signed an agreement to arbitrate the dispute before Cohen. According to Rabbi Yitz Greenman ("Greenman"), Aish's executive director, and Stuart Schabes ("Schabes"), an attorney who represented Aish at the second and subsequent arbitration sessions, Fetman, while testifying before Cohen, admitted to stealing Aish's funds and operating secret bank accounts, prompting the need to address an expanded "dispute". Thus, on October 22, 2013, prior to proceeding with the second session, the parties signed a second agreement to arbitrate.

At the completion of the second session, Cohen issued a directive requiring Fetman and his wife to produce their financial records. Fetman provided some of these materials at the third session, which took place on October 30, 2013, but as the records provided were incomplete, Cohen issued a second, more extensive directive requiring the production of additional financial records, unrestricted access to e-mail accounts, and directing Fetman "to prove that all funds deposited into the accounts belong to him; all amounts that Mr. Fetman is unable to prove ownership of must be paid promptly by Mr. Fetman to Aish." The directive further required Fetman to provide funds to be held in escrow pending completion of the proceedings and directed that no assets be transferred without permission of Cohen. Fetman thereafter complied with the latter directives by providing $500,000 to Schabes' law firm to be held in escrow, and by providing Cohen a power of attorney over Fetman's financial assets and over certain real property.

The fourth and final session was held on December 9, 2013, at which Fetman appeared with Daniel Stein ("Stein"), an attorney. According to Schabes, Cohen confronted Fetman about his failure to produce the documentation required by his first and second directives, but gave Fetman more time to provide the documents. However, by way of a December 13, 2013 letter addressed to Schabes, Stein requested that Schabes return the money held in escrow, and informed Schabes that Fetman had revoked the power of attorney issued to Cohen. On December 17, 2013, Greenman sent Cohen a fax in which he outlined his view of the evidence presented at the proceedings and requested that Cohen issue a final award in Aish's favor.^[FN1] That same day, Cohen issued an award, dated December 17, 2013, which stated that "since the forensic accountant who went through some documents notified us that at least $2.4 million was [*3]stolen by Mr. Fetman, and since the books and records that were examined since Mr. Fetman's employment make it likely to the examiner that approximately $20,000,000 was stolen from Aish Hatorah over the years", $20,000,000 was awarded to Aish. The Award also stated that all properties and entities that could be traced, or belong to, Fetman could be confiscated by Aish.

Although the Award authorized the confiscation of certain properties by Aish, it did not list the specific properties that were subject to confiscation. Accordingly, shortly after the issuance of the Award, Schabes asked Cohen if he could clarify the Award to explicitly name those specific properties. Cohen then issued a "clarification" of the award, dated December 19, 2013 ("Clarification"), which listed several properties that Cohen deemed were subject to confiscation by Aish. In this Court's Prior Decision, the Award of December 17, 2013 was confirmed but the petition to confirm the Clarification was denied and the Clarification was vacated, largely based upon the fact that another entity, Merkaz The Center, Inc. ("Merkaz"), that was not a party to the arbitration, claimed ownership of some of the properties. The matter was remitted for further hearing and arbitration to include Merkaz, which was permitted to intervene.

Fetman's position is that he only entered into the arbitration agreement because of duress. However, in the Prior Decision, the Court ruled that Fetman's argument that the agreement to arbitrate was obtained through duress was waived by his participation in the proceedings. The Court further ruled that Greenman's alleged threat to expose Fetman as a thief and the threat of criminal prosecution did not constitute duress under the circumstances. Respondent also previously argued that he never admitted to taking Aish's money, that he was not present when the forensic accountant presented his proof, and that he did not have the opportunity to cross-examine the forensic accountant and did not have the opportunity to present his own proof. The Court found that Fetman also waived these issues by his continued participation in the arbitration proceedings without specifically raising these issues before the Arbitrator.

New York favors arbitration as a means of resolving disputes and courts interfere as little as possible with agreements to arbitrate (Matter of Smith Barney Shearson v Sacharow, 91 NY2d 39, 49 [1997]). While a court will not compel a party to arbitrate and surrender the right to resort to the courts absent evidence that affirmatively establishes that the parties expressly agreed to arbitrate their disputes (Matter of Waldron [Goddess], 61 NY2d 181, 183-184 [1984]; Matter of Miller, 40 AD3d 861, 862 [2d Dept 2007]), a party waives his or her right to challenge the validity of an agreement to arbitrate by participating in the arbitration (Matter of Commerce & Indus. Ins. Co. v Nester, 90 NY2d 255, 262-264 [1997]; Matter of Meisels v Uhr, 79 NY2d 526, 538 [1992]; CPLR § 7511 [b] [2] [ii]). A party who has participated in an arbitration may only obtain vacature of an award where the party's rights were prejudiced by corruption, fraud or misconduct in procuring the award, a procedural failure that was not waived, the bias or partiality of an arbitrator, or that the arbitrator exceeded his or her power or failed to make a final and definite award (Matter of Silverman [Benmor Coats], 61 NY2d 299, 307 [1984]; CPLR § 7511 [b] [1]).

Respondent seeks to vacate the confirmation of the Award based on newly discovered [*4]evidence ^[FN2] , pursuant to CPLR § 5015(a)(2), (a)(3), and CPLR § 2221(e), which respondent claims demonstrates that the arbitrator was biased and that respondent's rights were prejudiced by corruption, fraud, and misconduct. Respondent also challenges the rationality of the $20 million Award based on this purported new evidence. CPLR § 5015(a)(2) provides that "[t]he court which rendered a judgment or order may relieve a party from it upon such terms as may be just, on motion of any interested person with such notice as the court may direct, upon the ground of newly-discovered evidence which, if introduced at the trial, would probably have produced a different result and which could not have been discovered in time to move for a new trial". CPLR § 5015(a)(3) provides for relief from a final judgment upon the ground of fraud, misrepresentation, or other misconduct of an adverse party. Because the Prior Decision was reduced to a final judgment, the proper procedural remedy is a motion pursuant to CPLR § 5015 (see Willard v Town Board, 216 AD2d 861, 862 [4th Dept 1995]).

Respondent also seeks to renew its prior motion to vacate the Award, pursuant to CPLR § 2221(e), based upon newly discovered evidence. CPLR § 2221(e) provides that a motion to renew "shall be based upon new facts not offered on the prior motion that would change the prior determination. . . and shall contain reasonable justification for the failure to present such facts on the prior motion." Respondent proffers new evidence consisting of the following: (1) arbitration transcripts dated December 22, 2014 and January 12, 2015, from supplemental arbitration proceedings ordered by this Court relating to the vacated Clarification Award, (2) an affidavit from Shmuel Grossman, dated November 12, 2014, regarding a conversation he had with Cohen at a wedding on June 30, 2014, (3) correspondence between Cohen and counsel for respondent dated November 24, 2014, (4) a press release dated December 4, 2014 announcing the New York State Grand Jury indictment of the respondent for embezzling more than $237,477 from Aish, (5) Cohen's selection of the president of his own synagogue as an arbitrator, which respondent claims shows bias, and (6) petitioner's complaint against Aish's own accountants, filed in New York County on December 5, 2014, styled Aish Hatorah New York, Inc. v Rothstein-Kass, P.A., index number 653737/2014.^[FN3]

None of this purported new evidence would have produced a different result or changed the prior determination confirming the Award. The Prior Decision remitted the matter of the clarification of the Award for further hearing before Cohen, an arbitrator to be selected by Cohen, [*5]and a third arbitrator to be selected by Fetman and intervenor Merkaz. Although there are no transcripts available from the original four arbitration sessions, these subsequent sessions were put on the record. Respondent argues that the transcripts from arbitration sessions held on December 22, 2014 and January 12, 2015 demonstrate that there was no forensic report upon which Cohen relied and that Cohen's Award of $20 million was irrational. Respondent points to statements made by Cohen that he is not aware of a forensic report and that, based on evidence offered by the forensic accountant, Victor Lipnitsky ("Lipnitsky"), that $2.5 million was stolen over a certain amount of time, Cohen "conjecture[d] that [Fetman] took up to twenty million dollars" (see Transcript of December 22, 2014, p. 15, ll 12-13; Transcript of January 12, 2015, p. 28).^[FN4]

Although it is undisputed that Cohen did not rely on any report prepared by the forensic accountant, Cohen did rely on Lipnitsky's testimony during the original arbitration sessions. All of Lipnitsky's testimony was presented during the original arbitration sessions in front of all of the parties and their attorneys, using data that was primarily provided by Fetman himself (see Deposition of Victor Lipnitsky, Ex. E to Petitioner's Affirmation in Opposition). As Cohen stated in the Award, the forensic accountant testified that based on the limited documents he reviewed, about $2.4 million was stolen by Fetman and that it was likely that $20 million had been stolen over the years. Further, in the letter from Cohen to Fetman's counsel, Joseph Zelmanovitz, Esq., dated November 14, 2014, which respondent also proffers as new evidence, Cohen states that the Award was an "extrapolation of the money that [Fetman] admitted that he embezzled." Respondent argues that Cohen's statement that the Award was an "extrapolation", and the lack of a forensic report, are evidence that the Award of $20 million is wholly irrational and should be vacated.

Respondent also attacks the amount of the Award on the basis of an affidavit from Shmuel Grossman, dated November 12, 2014, which was submitted in the related Merkaz case. Grossman states that he had a conversation with Cohen at a wedding that took place on June 30, 2014, during which Cohen purportedly told Grossman that he did not have proof to support an award of $20 million and issued such a large award against Fetman in order to encourage him to enter negotiations. This affidavit must be rejected as hearsay as it is a statement made out of court and is proffered by the respondent as truth to show that Cohen had no rational basis for the Award (see People v Romero, 78 NY2d 355 [1991]; Matter of Juliet M., 16 AD3d 211, 212 [1st Dept 2005]).

Respondent further argues that the Award is irrational because the New York State Grand Jury indicted Fetman for stealing only $237,477, significantly less than the $20 million Award. This purported new evidence would not change this Court's prior determination because the [*6]amount of the criminal indictment, and the burden of proof involved in criminal matters, has no bearing on the confirmation of an Award that was reached in the arbitration proceeding here. Further, this cannot be considered new evidence as Fetman was indicted prior to December 4, 2014, and this information was readily available at the time of respondent's December 16, 2014 order to show cause to renew and reargue. The Court did not overlook the fact of Fetman's indictment in that this issue was raised and rejected by the Court as a reason to stay civil proceedings during oral argument on December 17, 2014 on respondent's order to show cause to vacate the award.

In order to vacate an award on the basis of irrationality, a party must show that there was no proof whatsoever to justify the award (see Matter of Eastman Assoc., Inc. [Juan Ortoo Holdings, Ltd.], 90 AD3d 1284, 1285 [3d Dept 2011]). A challenge on the basis of irrationality must be denied and the award must be upheld as long as the arbitrator provides "even a barely colorable justification for the outcome reached" (Matter of Professional, Clerical, Tech., Empls. Assn. [Board of Educ. for Buffalo City Sch. Dist.], 103 AD3d 1120, 1122 [4th Dept 2013], lv denied 21 NY3d 863 [2013]). Here, the Award is clearly supported by the testimony of a forensic accountant and must be upheld even if the final amount awarded is an "extrapolation" based on incomplete records. Further, respondent's argument that the Award was punitive or was due to bias on the part of the arbitrator is rejected because an award cannot be considered punitive merely because it is not arrived at by precise mathematical computation (see Board of Educ. of Cent. School Dist. No. 1 of Towns of Niagara, Wheatfield, Lewiston & Cambria v Niagara-Wheatfield Teachers Assn., 46 NY2d 553, 557 [1979]).

Respondent further argues that the arbitration transcripts demonstrate Cohen's bias against Fetman in that Cohen referred to Fetman as a "metzaer lerabim", a Hebrew word purportedly meaning "molester" or "a public menace" (see Transcript of December 22, 2014, pp. 17-18). However, the arbitration session during which such statements were made took place long after the issuance of the Award. Further, respondent did not raise the issue of the arbitrator's alleged bias during the hearing, and thus, waived any challenge thereto (see Matter of Eastman Assoc., Inc. [Juan Ortoo Holdings, Ltd.], 90 AD3d at 1286). Bias cannot be inferred based solely on the claim that "the arbitrator unfairly weighed the evidence in petitioner's favor and made credibility assessments against it" (id.). It is clear that Cohen made inferences based upon evidence before him, including the findings of the forensic accountant and the records produced by Fetman upon which he relied, and made certain negative inferences against respondent due to his failure to produce more complete documents as directed. These negative inferences do not demonstrate bias on the part of the arbitrator and do not render the Award irrational. Cohen's selection of David Goldman, the president of Cohen's synagogue as an additional arbitrator, pursuant to this Court's directive in the Prior Decision, similarly fails to provide clear and convincing evidence of bias against Fetman. There is no allegation or evidence offered that David Goldman had any prior knowledge of the matter before the arbitration panel or held any bias against Fetman.

Respondent further seeks to reargue its December 16, 2014 order to show cause seeking vacature of the Award, reargument and renewal of this Court's Prior Decision, a stay of enforcement of the Judgment, and a stay of the instant action and related arbitration proceedings pending the outcome of the criminal matter. By order dated December 17, 2014, this Court [*7]denied respondent's motion as untimely and denied any stay of arbitration. CPLR § 2221(d) provides that a motion for leave to reargue "shall be based upon matters of fact or law allegedly overlooked or misapprehended by the court in determining the prior motion, but shall not include any matters of fact not offered on the prior motion" and "shall be made within thirty days after service of a copy of the order determining the prior motion". Respondent does not dispute that the portion of its December 16, 2014 order to show cause seeking reargument was untimely, but argues that that aspect of the motion seeking renewal based upon newly discovered evidence was timely and should have been considered. In light of the instant grant of leave to reargue and renew, the procedural issues raised as the Court's prior error in denying respondent's motion to renew as untimely are moot and need not be addressed. Upon review of the new evidence proffered, the Court has determined that none of the new evidence would change the prior determination confirming the Award.

Respondent also seeks a stay of these proceedings and the arbitration proceedings until the conclusion of the related criminal matter. This relief was previously denied by this Court and is again denied. "Although a defendant in an ongoing criminal prosecution faces a dilemma whether to defend a civil proceeding involving the same subject matter or to assert the Fifth Amendment privilege, a court need not permit a defendant to avoid this difficulty by staying a civil action until a pending criminal prosecution has been terminated'" (El-Dehdan v El-Dehdan, 114 AD3d 4, 20 [2d Dept 2013], quoting Matter of Astor, 62 AD3d 867, 869 [2d Dept 2009]). Such delay would be particularly inappropriate here as the criminal prosecution may take years to conclude and the issue now in arbitration concerns real property claimed by a third party to the original arbitration.

Since the confirmation of the Award by this Court, respondent has made multiple attempts to vacate the Award and to re-litigate the findings of the arbitrator. However, "[a] court cannot examine the merits of an arbitration award and substitute its judgment for that of the arbitrator simply because it believed its interpretation would be the better one. Indeed, even in circumstances where an arbitrator makes errors of law or fact, courts will not assume the role of overseers to conform the award to their sense of justice" (Matter of New York State Correctional Officers v State of New York, 94 NY2d 321, 326 [1999]). The Court cannot be put in a position to re-litigate issues already determined during an arbitration proceeding which the parties opted for in lieu of the courts and in which the parties chose their own arbitrator.

Upon renewal and reargument, respondent's motion to vacate the Award is denied in its entirety and the Prior Decision of this Court, as well as the decisions of April 30, 2014 and December 17, 2014, are upheld. The Court declines to award sanctions at this time, but sanctions will be awarded against respondent upon any subsequent repetitious motion.

This constitutes the Decision and Order of the Court.