LITIGATION DEPARTMENT REVIEW – 2022 

Posted on December 21st, 2022

The Ansell Grimm & Aaron (AGA) Litigation Department handled a wide variety of complex commercial disputes throughout 2022. Below we highlight several of the team’s successes. 

Recovery for Landlord in Debtor’s Attempt to Escape Obligations 

Partner Anthony J. D’Artiglio and Shareholder and department co-chair Joshua S. Bauchner recently secured a favorable decision from the Bankruptcy Court in the Southern District of New York in the Fairway Group Holdings Corp. matter. Our client, Debtor’s property owner, filed a multi-million-dollar cure objection asserting that Debtor had failed to repair and maintain the property in accord with its lease obligations, and thus needed to make the necessary repairs or pay for the repairs as part of the lease assumption and assignment. Debtor sought to dismiss the cure objection, arguing that the new tenant was responsible for all pre-assignment defects as part of the lease’s ongoing repair and maintenance obligations and that, because property owner did not issue a default notice pre-petition pursuant to a lease provision, property owner could not claim that a “default” existed requiring cure pursuant to the Bankruptcy Code. The Court resoundingly rejected Debtor’s arguments, holding that (i) Debtor is responsible for all necessary pre-assignment repairs pursuant to the lease because the buyer took the property “free and clear” of any and all defaults by Debtor at the time of the assignment, and (ii) landlord was not required to formally notice a “default” under the lease to seek the cost of repairs from Debtor for any pre-assignment condition in need of repair particular where, as here, Debtor was on notice upon the filing of the cure objection.  As a result of this favorable ruling, our client can recover millions of dollars in repair costs. 

Summary Judgment Benefitting Child’s Trust 

The firm was retained by a single mother seeking to enforce a decade-old settlement agreement against her child’s wealthy father, who failed to pay substantial sums into trust for their daughter.  Following lengthy litigation, including extensive motion practice and discovery, Senior Associate Seth M. Rosenstein secured summary judgment in favor of the child, ensuring that nearly $1 million in improperly withheld funds are paid into a trust to be established for her benefit.  The court also awarded all costs and fees associated with establishing the trust for the child.  This notable outcome ensures that the subject child is well provided for and finally has access to funds that should have been made available for her benefit many years prior.

Summary Judgement Secured in Convoluted Fraudulent Mortgage Matter 

Spearheaded by Litigation Department co-chair Lawrence H. Shapiro and Attorney Layne A. Feldman, AGA was successful in obtaining summary judgment on behalf of its client in a convoluted litigation involving claims of fraudulent mortgages and satisfaction of mortgages. Stepping into the shoes of a prior counsel at the request of Plaintiffs and using the fact that the parties to the suit had attempted to litigate similar issues in prior lawsuits, AGA was able to demonstrate to the Court in 279 Veterans, LLC, et al. v. Village Green Associates, LLC, Docket No. MID-C-107-20, that preclusive doctrines applied and prevail on Plaintiffs’ declaratory judgment claim. The result of the Court’s ruling is that the Satisfaction of Mortgage filed by the Defendants will be removed from the chain of title of the property in question and is of no force and effect, preserving Plaintiffs’ Mortgage. 

Protection for Landlord from Tenant Bankruptcy  

Partner Anthony J. D’Artiglio and Shareholder Joshua S. Bauchner secured an extremely favorable settlement on behalf of a property owner whose tenant filed for bankruptcy after failing to make any rent payments over a prolonged period. Following our filing of an application to compel lease rejection or for relief from the automatic stay, the tenant agreed to pay outstanding rent and additional rent, our client’s attorneys’ fees and costs, and to increase the security deposit as a condition of assumption of the lease, ensuring the property owner was not harmed by the tenant’s bankruptcy filing.  

Relief for Landlord from Automatic Bankruptcy Stay 

Partner Anthony J. D’Artiglio and Shareholder Joshua S. Bauchner successfully secured relief from the automatic bankruptcy stay for a landlord whose tenant had sublet the property without authorization, failed to pay substantial rent, and additional rent due and owing. We successfully convinced the Court to order the tenant to make post-petition payments on an ongoing basis and to lift the automatic stay to permit the property owner to pursue the tenant for damages and eviction in State Court while the bankruptcy remained pending. 

FINRA Advisor Defense 

Ansell Grimm & Aaron was retained by a long-established FINRA-licensed broker dealer and its principal, in connection with litigation filed against them in the Superior Court of New Jersey, alleging causes of action relating to investment banking services provided to a technology startup. After several years of litigation, this matter was referred by counsel to Seth M. Rosenstein and Joshua Bauchner of the firm’s litigation department, in light of Mr. Rosenstein’s extensive FINRA experience and both counsel’s success in litigating matters before the Superior Court. Rosenstein and Bauchner successfully filed a motion to stay the Superior Court action and compel FINRA arbitration — seeking to invoke an investment banking agreement (IBA) containing a FINRA arbitration clause, under which the plaintiff previously sought third-party beneficiary status. The court held that plaintiff was estopped from disavowing his claimed third-party beneficiary status under the IBA to avoid arbitration, and that the parties’ dispute must be heard before a FINRA arbitration panel, among other things. The court’s decision is a remarkable result for parties seeking to enforce arbitration agreements, and for ensuring that the learned professionals sitting on FINRA arbitration panels adjudicate industry disputes. 

Relief Won Against Subcontractor’s Claims for Payment 

Attorney Kelsey Barber, and Shareholder Lawrence H. Shapiro, successfully had a subcontractor’s claims against a client-property owner dismissed in a complex construction litigation. Plaintiff-subcontractor sought to recover monies for work performed at AGA’s client’s property when the property owner terminated the project’s general contractor. AGA was able to demonstrate to the Court that the property owner cannot be liable to a subcontractor for a general contractor’s default and that the Plaintiff’s claims for quasi-contractual relief were unfounded under New Jersey law. The Court granted Summary judgment as to all counts in AGA’s client’s favor. 

Success for Youth Community Center 

Partner Anthony J. D’Artiglio and Shareholder Lawrence H. Shapiro defeated a motion for summary judgment seeking to declare that our client’s, a youth community center and academic tutoring facility, use of their property rendered an easement agreement with a neighboring property owner extinguished. The neighboring property owner filed an action seeking to declare the easement expired and challenged the Zoning Board’s approval of a use variance and bulk variance relief. We successfully convinced the Court that the motion for summary judgment was premature and relied on a flawed reading of the easement agreement, leading to the complete denial of the motion. The neighboring property owner thereafter agreed to voluntarily withdraw its claims against our client, permitting the youth community center to continue to operate. 

Synagogue May Proceed with Development 

Partner Anthony J. D’Artiglio and Shareholder Lawrence H. Shapiro defeated an application to stay development activities pending prosecution of a prerogative writ permitting our client to continue development activities at the property. Plaintiffs asserted claims against our client, a synagogue, claiming that the planned development activities violated a settlement agreement and that the Zoning Board improperly approved the planned developed. Plaintiffs first filed an Order to Show Cause seeking to stay the Zoning Board from acting on our client’s application and to have their claims adjudicated in a summary manner. We opposed the Order to Show Cause, culminating in the Plaintiffs withdrawing the Order. Thereafter, Plaintiffs sought to stay our client from performing any activity at the property pending disposition of Plaintiffs challenge to the Zoning Board approval. We successfully convinced the Court that no stay was warranted leading to a total denial of the stay application, permitting our client to proceed in accordance with the approvals. 

 

 

About Ansell Grimm & Aaron, PC
Ansell Grimm & Aaron, PC was founded in 1929 and has a long history of delivering for clients who come to us to resolve legal matters that are often urgent, stressful, and of great importance. A general practice law firm, Ansell Grimm & Aaron is powered by experienced attorneys who understand that the best outcome is the one that serves the needs of each client.

The above is for informational purposes only and does not constitute legal advice. Transmission of the materials and information contained herein is not intended to create, and receipt thereof does not constitute the formation of, an attorney-client relationship. Attorney advertising.

This entry was posted on Wednesday, December 21st, 2022 at 12:43 am and is filed under Litigation, News.