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Interstitial Issues: Direct vs. Derivative, Preliminary Injunctions, and Arbitrability
Reprinted from: Federal Bar Council Quarterly | 08/04/2025In the latest issue of Federal Bar Council Quarterly, Cadwalader’s Adam Magid analyzes three recent Second Circuit decisions addressing consequential procedural issues that often shape outcomes before a case reaches the merits.
Adam discusses the Circuit’s adoption of Delaware’s “Tooley” test for distinguishing direct from derivative claims under New York law, as applied in In re 305 E 61st Street Group LLC. He also highlights St. Joseph’s Hospital v. American Anesthesiology of Syracuse, where the court reaffirmed the demanding standard for preliminary injunctions. Lastly, he examines Certain Underwriters at Lloyds v. 3131 Veterans Blvd LLC, where the court held that state laws prohibiting arbitration in insurance disputes cannot override self-executing treaty provisions like those in the New York Convention.
Adam notes that while often overlooked, procedural rulings like these have far-reaching implications for business litigation strategy.
Read the full column here.
