Matters

Affordable Housing Developer – Resolution of Breach of Contract Claims against NYCHA

Negotiated a favorable settlement on behalf of a national developer of affordable housing, resolving a breach of contract litigation against the New York City Housing Authority related to a high-profile and long-stalled project to redevelop a large New York City public housing complex.

Commercial Real Estate Firm – Partial Summary Judgement Granted in Complex Dispute

Awarded partial summary judgement on behalf of commercial real estate client in a dispute with a former officer and member of the parties’ investment vehicle. The New York Federal Court held that that the plaintiff former officer breached contractual obligations and fiduciary duties by misappropriating resources and soliciting investors during his employment. The Court granted Herrick’s clients’ requested declaratory relief by holding that they properly ascribed “Cause” to the officer’s termination upon discovering the misconduct and validly effectuated the termination and redemption of his profits interest in the parties’ investment vehicle for a penny. The Court also ordered the disgorgement of the former officer’s salary and value of company paid benefits during his period of disloyalty together with injunctive relief requiring him to return all confidential and proprietary information. Notably, the Court also held that the officer’s new business and business partner were jointly and severally liable for aiding and abetting the breaches of fiduciary duty. The litigation remains ongoing.

Developer – Successful Defense in Breach of Contract and Fraud Dispute

Herrick successfully defended Muss Development in the Appellate Division, First Department appeal of Princes Point LLC, et al. v. Muss Development LLC et al., a case involving the plaintiff's breach of a $36 million contract to purchase Princes Point, a 23-acre waterfront parcel of land on the south shore of Staten Island, from Muss. The First Department unanimously confirmed Herrick's earlier Supreme Court, New York County victory for Muss, which entitles the real estate developer to retain the plaintiffs' approximately $4 million deposit plus other fees totaling nearly $1 million. In doing so, the court delved into an area where there was a dearth of case law in New York – namely, whether a prospective real estate purchaser anticipatorily breaches a sale contract by commencing an action against the seller for rescission before the closing date, and whether, in that event, the seller is required to show that it was ready, willing, and able to complete the sale. The court held that the plaintiff had anticipatorily breached the contract and that Muss is entitled to keep the deposit and other significant fees without having to show that it was ready, willing and able to close. Once there was a breach, there was no need to spend time and money preparing for a closing that was not going to happen.

New York State Association for Affordable Housing – Challenge to Local Law 44

Representing the New York State Association for Affordable Housing and individual developers in litigation seeking to invalidate Local Law 44 - which requires any developer receiving city funding to submit quarterly wage reports - as unconstitutional, pre-empted by New York state law, and imposing an unreasonable economic burden on small businesses competing for affordable housing work.

Publicly Traded REIT – Credit Default Swap Default

Defense of a publicly traded hospitality REIT against allegations by its counterparty, a large multi-national investment bank, that two of our client's funds defaulted on their obligations under a $1.2 billion credit default swap.

Heirs of Kazimir Malevich – Amsterdam Settlement

Representing the heirs of the world-renowned Russian artist Kazimir Malevich in their litigation against the City of Amsterdam to reclaim artworks created by their ancestor. This litigation was successfully settled in April 2008 when the City of Amsterdam returned five Malevich paintings to the heirs.

Former CEO – SEC Investigation

The former CEO of a major fiber optic company in an SEC investigation of accounting irregularities. After a grueling deposition and an in-depth Wells Submission, the SEC determined not to pursue any action against our client.

Real Estate Board of New York – Mitchell-Lama Litigation

Represented the Real Estate board of New York in its successful lawsuit against the New York City Council to overturn Local Law 79. The law required owners of Mitchell-Lama housing and housing subsidized by certain federal programs to give a right of first refusal to purchase their projects to tenants, pursuant to an ambiguous and burdensome process. The Court found that the law was preempted by federal and state housing laws, and enjoined the City from enforcing it.

Real Estate Developer – Mixed-Use Conversion Case

Successfully represented a real estate developer in litigation over its right to convert a building it purchased from office/retail use to mixed office/retail and residential use.

9/11 Families and Victims – Compensation Fund Assistance

Pro bono assistance to victims and their families in recovering funds from the 9/11 Victim Compensation Fund.

Henry Newman – Settlement with Metropolitan Museum of Art (Claude Monet)

Represented a collector in the settlement of a dispute over a painting by Claude Monet in the collection of the Metropolitan Museum of Art claimed to have been stolen from a bank vault during the Soviet occupation of Berlin in 1945.