Steinberg v. W.J. Nolan & Co.

*245Order, Supreme Court, New York County (Richard B. Lowe, III, J.), entered June 9, 2004, insofar as it denied third-party defendants’ motion to stay the third-party action and compel arbitration, unanimously modified, on the law, further prosecution of the third-party action stayed pending arbitration of the remaining issues in accordance with the Rules of the New York Stock Exchange, and otherwise affirmed, without costs.

Although the third-party action is for contribution and indemnification, it is not contractually based, but instead arises out of the allegations in the main complaint (cf. FSP, Inc. v Societe Generate, 350 F3d 27 [2d Cir 2003]). As such, the third-party dispute stems from underlying allegations of dishonesty on the part of those who trade in securities. Since the controversy involves the Exchange-related business of a member organization of the New York Stock Exchange and its officers, board of directors and employees, arbitration at third-party defendants’ election was required under the Exchange’s Constitution and Rules (see Spear, Leeds & Kellogg v Central Life Assur. Co., 85 F3d 21 [2d Cir 1996], cert denied 519 US 1040 [1996]). Concur— Buckley, EJ., Tom, Saxe, Friedman and Marlow, JJ. [See 6 Mise 3d 1003(A), 2004 NY Slip Op 51709(U) (2004).]