Teta v. Go N.Y. Tours, Inc.

1

CINDY TETA and MOTTY STEIN, individually and on behalf of all others similarly situated, Plaintiffs, v. GO NEW YORK TOURS, INC., d/b/a TOPVIEW SIGHTSEEING AND EVENT CRUISES NYC-CITY LIGHTS CRUISE, Defendant.

No. 24-cv-01614 (ER)

United States District Court, S.D. New York

November 21, 2024

OPINION & ORDER

RAMOS D.J.:

Cindy Teta and Motty Stein (collectively, “Plaintiffs”) bring this class action on behalf of all similarly situated consumers against Go New York Tours, Inc., d/b/a Topview Sightseeing and Event Cruises NYC (“Go New York”) for a violation of New York Arts & Cultural Affairs Law § 25.07. Before the Court is Plaintiffs' motion to certify an order for interlocutory appeal based on this Court's July 1, 2024 Order compelling arbitration between the parties. Doc. 24. For the reasons set forth below, the motion is DENIED.

I. BACKGROUND

Go New York is a New York City tour company that is incorporated in New York and maintains its principal place of business in New York, New York. ¶ 10.^[1] Go New York sells, among other things cruise tickets from its website, https://eventcruisenyc.com/events/city-lights-cruise-nyc. ¶¶ 1-2.

Teta and Stein were purchasers of tickets for Go New York's sightseeing cruise. ¶¶ 7, 9. During the purchasing process, Plaintiffs allege that Go New York's website did not disclose the additional fees that were to be added to the initially displayed ticket price before checkout. ¶¶ 9, 20, 21.

The process for purchasing a ticket for a Go New York tour on its website is as follows:

(1) select a cruise departure date, ¶ 18 (figure 1);

(2) select General or Premium admission, with corresponding prices for each option. ¶ 20 (figure 2). At this stage, the price of additional fees is not mentioned, however “+ fees” is included next to the price of the ticket, id.;

(3) once a ticket is selected, customers are prompted to input their name and email address. ¶ 21 (figure 3). The price at this stage still remains the same as in step 2 above, with the price of additional fees not disclosed, however “+fees” is included next to the price of the ticket, id.; and

(4) lastly, customers are taken to the order summary page. ¶ 22 (figure 4). Here, the total price is provided which includes additional fees, broken down into various categories (“marine,” “ticketing & handling” and “fuel”). Id.

At the final checkout step, customers must agree to the terms and conditions of Go New York's website via a clickwrap agreement before they are able to purchase tickets. Doc. 11-1 at 2. The clickbox is next to a line of text that reads “I have read and agree to eventcruisenyc.com terms and conditions.” Id. “Terms and conditions” is in light blue text with a hyperlink to the terms. Id. When customers click the hyperlink, the first paragraph of the terms and conditions includes a statement that Go New York's “terms and conditions contain a mandatory arbitration provision that requires the use of arbitration on an individual basis and limits the remedies available to you in the event of certain disputes.” Doc. 11-2 at 2. The terms also include a section titled “Liability and Warranties Disclaimer” which states, among other things, as follows:

You agree that any dispute, controversy or claim arising out of or in regards to this liability and warranties disclaimer shall be settled by binding arbitration in accordance with the laws of New York State, before a single arbitrator of the American Arbitration Association (“AAA”). The arbitration process including but not limited to payments, administration and fees will be conducted under the AAA. regulations and rules.

You and TopView agree that any dispute arising out of or related to these Terms and Conditions or the Services offered by TopView is personal to You and TopView and that such dispute will be resolved solely through individual arbitration and will not be brought as a class arbitration, class action or any other type of representative proceeding

Doc. 11-3 at 8.

Teta and Stein filed suit individually and on behalf of all purchasers of tickets to City Lights Cruise on March 1, 2024, asserting that Go New York's website did not “disclose the total cost of the ticket . . . prior to the ticket being selected for purchase” and increased the ticket price “during the purchase process” in violation of the New York Arts and Cultural Affairs Law § 25.07. Doc. 1 ¶ 3-4. On May 10, 2024, Go New York moved to compel arbitration pursuant to the mandatory arbitration clause in their terms and conditions, and on July 1, 2024, this Court issued an order granting Go New York's motion to compel arbitration and instructed the parties to inform the Court no later than July 15, 2024 if they wished for the action to be stayed rather than dismissed. Docs. 10, 15. Subsequently, plaintiffs filed a letter with the Court indicating their intent to seek an interlocutory appeal and pursuant to approval from both parties, the Court stayed the case pending resolution of arbitration on June 23, 2024. Docs. 18, 22, 23. Plaintiffs filed the instant motion for leave to appeal the Court's July 1, 2024 order on August 13, 2024. Doc. 24. Specifically, Plaintiffs argue that an interlocutory appeal is appropriate because: (1) the issue of whether an arbitration clause governing a contract and its services also covers pre-marketing conduct is a controlling question of law; (2) there is substantial ground for difference of opinion; and (3) an immediate appeal would materially advance the litigation. Id.

II. LEGAL STANDARD

A district court may certify an order for interlocutory appeal pursuant to Section 1292 of Title 28 of the United States Code when the court is “of the opinion that such order (i) involves a controlling question of law (ii) as to which there is substantial ground for difference of opinion and (iii) that an immediate appeal from the order may materially advance the ultimate termination of the litigation.” 28 U.S.C. § 1292(b). Certification of an interlocutory appeal may be granted in certain cases when appropriate to “avoid protracted and expensive litigation.” Primavera Familienstfung v. Askin, 139 F.Supp.2d 567, 570 (S.D.N.Y. 2001) (citing Telectronics Proprietary, Ltd. v. Medtronic, Inc., 690 F.Supp. 170, 172 (S.D.N.Y. 1987)).

“It is a basic tenet of federal law,” however, “to delay appellate review until a final judgment has been entered.” Pentacon BV v. Vanderhaegen, No. 23 Civ. 2172 (KPF), 2024 WL 3835334, at *5 (S.D.N.Y. Aug. 15, 2024) (quoting Koehler v. Bank of Bermuda Ltd., 101 F.3d 863, 865 (2d Cir. 1996)). Thus, interlocutory appeals are “strongly disfavored in federal practice” and courts must exercise caution when departing from the final judgment rule. In re Adelphia Communications Corp., No. 07 Civ. 9999 (NRB), 2008 WL 361082, at *1 (S.D.N.Y. Feb. 7, 2008); Wausau Business Insurance Company v. Turner Construction Company, 151 F.Supp.2d 488, 491 (S.D.N.Y. 2001).

The decision to certify a question for interlocutory appeal is trusted to the sound discretion of the district court, which may deny the appeal for other reasons “even where the three legislative criteria of [S]ection 1292(b) appear to be met.” Pentacon, 2024 WL 3835334, at *5 (alteration in original) (quoting Transport Workers Union of America, Local 100, AFL-CIO v. N.Y.C. Transit Authority, 358 F.Supp.2d 347, 351 (S.D.N.Y. 2005) (internal citations and quotations marks omitted)). A district court's decision may be for “any reason, including docket congestion” and “the system-wide costs and benefits of allowing the appeal.” In re Facebook, Inc., IPO Securities & Derivative Litigation, 986 F.Supp.2d 524, 530 (S.D.N.Y. 2014) (quoting Klinghoffer v. S. N.C. Achille Lauro, 921 F.2d 21, 24 (2d Cir. 1990)). Moreover, “[t]he fact that district courts have the power to certify questions for interlocutory appeal in no way suggests that interlocutory appeals should be the norm.” Republic of Colombia v. Diageo North America Inc., 619 F.Supp.2d 7, 10 (E.D.N.Y. 2007). Indeed, the Second Circuit has held that although § 1292(b) was designed as a means to make interlocutory appeals available, “it is a rare exception to the final judgment rule that generally prohibits piecemeal appeals.” Koehler, 101 F.3d at 865.

III. DISCUSSION

I. The Order Does Not Involve a Controlling Question of Law

Plaintiffs allege that the July 1, 2024 Order contains a controlling question of law pertaining to whether an arbitration clause governing a contract and its services also covers pre-agreement marketing conduct. Doc. 24. Go New York contends that the Order concerns a mixed question of law and fact, which should proceed to final judgment, before Plaintiff is granted an opportunity to appeal. Doc. 25. The Court agrees that granting certification pursuant to § 1292(b) would require consideration by the Second Circuit of a mixed question of law and fact.

To be a question of law, the question “must refer to a ‘pure' question of law that the reviewing court could decide quickly and cleanly without having to study the record.” Capital Records, LLC v. Vimeo, LLC 972 F.Supp.2d 537, 551 (S.D.N.Y. 2013) (quoting Consub Delaware LLC v. Schahin Engenharia Limitada, 476 F.Supp.2d 305, 309 (S.D.N.Y. 2007)); see also Century Pacific, Inc. v. Hilton Hotels Corp., 574 F.Supp.2d 369, 371 (S.D.N.Y. 2008) (finding interlocutory appeal inappropriate without questions presenting issues of pure law). A question of law is considered controlling if “(a) reversal of the district court's opinion could result in dismissal of the action, (b) reversal of the district court's opinion, even though not resulting in dismissal, could significantly affect the conduct of the action, or (c) the certified issue has precedential value for a large number of cases....