LITIGATION PRACTICE
SAHN WARD COSCHIGNANO & BAKER represents its clients in all aspects of commercial litigation in state and federal trial and appellate courts. We have extensive experience litigating complex contract, tort and statutory claims arising from business-related activities. Several of our high profile cases have been featured in news articles appearing in various media outlets.
We have represented clients in litigations arising from virtually every type of business agreement, including without limitation, breaches and violations of contracts for the purchase and sale of commercial real property, business assets or securities; contracts for the purchase and sale of goods and services; commercial leases (including summary proceedings to recover possession of real property and related Yellowstone injunctions); commercial loan agreements, promissory notes, mortgages, security agreements, and guaranties; license agreements; shareholder, partnership, joint venture and other similar agreements relating to the ownership and operation of business entities; employment agreements, non-compete agreements and related restrictive covenants arising from employment relationships; and various insurance coverage matters.
The Firm has also represented clients in cases involving various business torts and statutory claims, including without limitation, direct and derivative actions for breach of fiduciary duty by corporate officers and directors; actions relating to the internal affairs of business organizations; actions for accountings and constructive trusts; actions for tortious interference with contracts and business opportunities; claims involving unfair competition and misappropriation of trade secrets; statutory and common-law claims of fraud, misrepresentation, deceptive business practices, and fraudulent conveyances; claims for defamation arising from business-related activities; labor and wage disputes; statutory and common-law environmental claims; and actions to dissolve corporations, partnerships, limited liability companies, limited liability partnerships, and joint ventures.
In addition to representing clients in commercial litigation, we also represent clients in litigation relating to all aspects of the acquisition, ownership, use and development of real property for commercial and residential purposes. We have extensive experience litigating Article 78 proceedings and plenary actions both on behalf of and against municipalities arising out of all types of land-use determinations that affect our client’s rights. We have also litigated title, boundary-line, adverse possession, trespass, nuisance, and loss of lateral support claims, as well as claims relating to the nature, scope and extent of rights under easements and licenses to use real property.
The Firm offers comprehensive litigation services to our clients from the inception of a case through appeal. Our litigation services include pre-action investigation and assessment of claims and defenses; preparation of pleadings (complaints, answers, replies and third-party practice); preparing and responding to pre-answer motions; all phases of pre-trial discovery, including document and e-discovery and the conducting and defending of depositions; post-answer motions for summary judgment; representation at court conferences, hearings and arguments; and representation at trial and on appeal, if necessary. We are also skilled at negotiating and structuring settlements at any point during the litigation process.
Our litigation client list features Fortune 500 companies; government agencies and authorities; prominent regional businesses, religious corporations and not-for-profit corporations; as well as individuals who own and operate businesses. Representative clients of the litigation practice include the Metropolitan Transportation Authority; the Long Island Rail Road; the New York City Transit Authority; The City of Glen Cove; The Great Atlantic and Pacific Tea Corporation; Warex Terminals Corp.; New York Community Bancorp,Inc.; Dovenmuehle Mortgage, Inc.; Westfield Corporation; and Chasanoff Properties.
While each case is different, the following matters provide insight into the nature and complexity of the commercial litigations handled by the Firm:
In a commercial landlord-tenant litigation, the Firm won a summary judgment dismissal of a $30 million claim brought by a commercial tenant against a prominent-landlord client and negotiated a settlement that resulted in the payment of $7 million in damages to the landlord, including $450,000 in legal fees. In this case, the tenant, a large publically traded company, requested permission to assign a long-term lease of a 136,000 square foot manufacturing facility located in Nassau County to a new tenant. The landlord refused to consent to the assignment based on the financial condition of the new tenant. The tenant assigned the lease over the landlord’s objection. In response, the landlord defaulted the tenant and terminated the lease before the tenant obtained a Yellowstone injunction. In the litigation that ensued, the tenant sued the landlord for $30 million for unreasonably withholding its consent to the assignment, and the landlord sued the tenant to recover possession of the building and damages for the remaining rent due under the lease. The Commercial Division of the Nassau County Supreme Court ruled that based on the undisputed facts developed during discovery, the landlord’s refusal to consent to the assignment was reasonable as a matter of law and dismissed all of the tenant’s claims. On the eve of trial of the landlord’s claims, the case settled with the tenant agreeing to the termination of the lease and the payment of $7 million to the landlord, including $450,000 in legal fees.
In an environmental litigation, the Firm won a $1.1 million damages verdict on behalf of a commercial property owner whose property was contaminated by gasoline constituents that originated from an adjacent gas station. After a lengthy trial in Suffolk County Supreme Court, the Court ordered the gas station owner to pay damages to the Firm’s client for cleanup costs, environmental consulting fees and legal fees incurred by our client.
In a civil fraud case, the Firm won a judgment on liability for an investor against the operator of a $25 million real-estate-investment Ponzi scheme. Our client thought that he had invested millions of dollars in a real estate venture. In fact, our client’s investment and those of other unsuspecting investors was partially used by the operator to pay fake returns to the investors, with the balance of the investment monies having been siphoned off by the operator through a complex web of business entities, family and associates. The case involved an extremely complex and tangled business structure, numerous complex fraudulent transactions, and the sudden disappearance of the operator’s business records during the litigation, which ultimately led the Commercial Division of the Nassau County Supreme Court to grant summary judgment to our client based on the operator’s spoliation of key evidence.
The Firm successfully negotiated a settlement agreement for a client caught up in a federal civil forfeiture action. The client held a $1.0 million purchase money mortgage on a commercial building in Nassau County. The owner of the property was indicted by a federal grand jury in Salt Lake City, Utah, for engaging in criminal activity related to the illegal sale of prescription drugs from the building, and, in connection with the indictment, the United States of America commenced a civil forfeiture proceeding in Utah federal court to the seize the building as an instrumentality of a federal crime. After the months of negotiation and the commencement of a mortgage foreclosure action here in New York that was ultimately removed by the United States to New York federal court, the United States entered into a settlement agreement with our client in which the government recognized the validity and priority of our client’s mortgage and agreed to promptly sell the building to satisfy the outstanding balance owed on the mortgage (including principal, interest and the client’s attorney’s fees). The building was ultimately sold at a public auction and our client was made whole from the sale.
In a land-use case, the Firm won a judgment in an Article 78 proceeding against the Village of Great Neck in connection with the Village’s rezoning of 25 acres of waterfront property from industrial to residential zoning, including the rezoning of our client’s vacant, 25,000 square foot commercial building. Because our client’s building had been vacant for several years prior to the adoption of the rezoning, the rezoning effectively precluded our client from redeveloping the property for commercial purposes and, even worse, effectively prevented our client from selling the property as a stand-alone property. The Nassau County Supreme Court annulled the rezoning, finding that the Village had failed to take the requisite “hard look” at the environmental impacts of the rezoning under the New York State Environmental Quality Review Act, which impacts included, among other things, the redevelopment of contaminated industrial properties with residential units in close proximity to existing municipal sewage treatment facilities. The decision was affirmed by the Appellate Division, Second Department. The New York State Court of Appeals denied the Village’s request for permission to appeal the ruling further. The court victory reinstated the industrial zoning and paved the way for our client to sell the building for $6.0 million. The new owner redeveloped the property for commercial purposes.
The Firm represented a national church in connection with a series of lawsuits commenced in Nassau County Supreme Court that arose out of the church’s termination of its former chancellor for various alleged financial improprieties. The case involved the intricacies of the internal governance of the church, which was formed by a special act of the New York State Legislature, the validity and enforceability of an ambiguous document purporting to obligate the church to pay $250,000 to the former chancellor, and allegations that the chancellor was unable to account for millions of dollars of church money entrusted to and disbursed by him while he was chancellor. The case ended in a negotiated settlement.
The Firm obtained an order vacating a foreclosure sale of a client’s $1.0 million residence for failure to pay a few thousand dollars in common charges to a homeowner’s association in the community where the home was located. The homeowner failed to pay the common charges and answer the complaint in the foreclosure action because she was caring for her seriously ill husband who, just weeks before the commencement of the action, had been diagnosed with a terminal illness, and who sadly passed away while the foreclosure action was pending. The home was sold for $326,000 at a foreclosure sale. When the purchaser served our client with a notice to vacate her own home, she was shocked and retained our Firm to represent her. Our investigation found that she had never been properly served with process in the foreclosure action and, more amazingly, that the purchaser of her home was a business entity owned and controlled by the attorney who represented the homeowner’s association in the foreclosure action. When the attorney and the homeowner’s association refused to consent to vacate the sale, we went to court to get relief. When presented with the facts underlying the sale, the Suffolk County Supreme Court voided the sale, finding that it was based on bad faith and unconscionable conduct.
In a contract case, the Firm obtained the dismissal of a claim by the holder of a right of first refusal to purchase a $3.75 million private school and camp property located in Suffolk County. The dismissal was affirmed by the Appellate Division, Second Department, and enabled our client to finalize the purchase of the property.
The Firm represents a hedge-fund client in connection with several litigations in state and federal court arising from the client’s investment of $14 million into a patent license for a new dispenser cap for various liquid and gel consumer products. The case involves claims of breaches of fiduciary duty and aiding and abetting breach of fiduciary duty against the directors and officers of the company into which the investment was made as well as resolution of who has the right to exploit the patent going forward.
In a labor and wage case, the Firm is defending the regional franchisee of a national restaurant/entertainment chain in a putative class and collective action brought under federal and state labor laws by present and past employees to collect alleged unpaid wages. The Firm has moved to compel arbitration under provisions set forth in an employee handbook signed by the plaintiffs.
The Firm is representing a partner who holds partnership interests in various partnerships that developed and owned low-income, HUD-subsidized apartment buildings in New York City. The partnerships terminated a management agreement for the buildings that was held by the son of one of the partners in the partnerships and then sold the buildings for $35 million over the objection of that partner. These transactions have spawned several litigations that are pending in the Commercial Division of the Nassau County Supreme Court.
