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Adler v. Ogden Cap Properties, LLC

Supreme Court of New York, New York County

December 11, 2013

Briana ADLER, Lauren Schoenfeld, Perri Steiner, on behalf of themselves and all persons similarly situated, Plaintiffs,
v.
OGDEN CAP PROPERTIES, LLC, Solil Management, LLC, 145 East 16th Street, LLC, Sol Goldman Investments, LLC, Tres Realty, LLC, and Does 1-500, Defendants.

[976 N.Y.S.2d 860] Lowey Dannenberg Cohen & Hart, PC and the Law Office of Harold M. Hoffman, for plaintiffs.

Herrick, Feinstein LLP, for defendants.

SHIRLEY WERNER KORNREICH, J.

Defendants Ogden CAP Properties, LLC (Ogden), Solil Management, LLC (Solil), Sol Goldman Investments, LLC (Goldman), 145 East 16th Street, LLC (145 East), and Tres Realty, LLC (Tres) move for summary judgment pursuant to CPLR 3212. Plaintiffs Briana Adler, Lauren Shoenfeld,[1] and Perri Steiner cross-move to file an amended complaint. The motion and cross-motion are granted in part and denied in part for the reasons that follow.

Factual Background & Procedural History

This is a putative bilateral class action. Plaintiffs seek to represent a class of all renters in the State of New York against a defendant class of all landlords in the State of New York to obtain rent rebates [976 N.Y.S.2d 861] for violations of the warranty of habitability caused by Superstorm Sandy (the Storm). Issues exist regarding the suitability of the class representatives, due process, and a host of other serious problems. To be sure, many of these questions will ultimately be adjudicated in a class certification motion. Yet, given the myriad unprecedented issues— both factual and legal— and the enormous cost of discovery, the court stayed discovery pending the resolution of this motion.[2] Indeed, the stakes are quite significant, as so many people's lives have been devastated by the Storm. Thus, it is imperative that the proposed vehicle for partially remedying such destruction is carried out in a way that is legally cognizable, capable of being managed by the court, and in full comport with the due process rights of both plaintiffs and defendants.

The Storm

On October 29, 2012, the Storm hit New York, causing devastation to millions. The fallout, however, was felt by some more than others. While some people had to deal with the mere inconvenience of a non-operational subway, many suffered immense losses, including their homes. To date, countless people are still picking up the pieces.

Though the aftermath of the Storm has been difficult, for many, surviving the Storm was a challenge. The experience of getting through the Storm turned on a multitude of factors, such as the fortune of being in a less-impacted location or in a building whose landlord helped mitigate the circumstances. The availability of electricity, heat, food, and other essentials also varied widely throughout Manhattan and other parts of the state, which were impacted differently. The range of experiences is unsurprising given that New York State has rental residences running the gamut from the zenith of luxury to the barely habitable. New York also has a diverse set of landlords, which include those who merely rent portions of their home and some of the world's wealthiest real estate magnates. Nonetheless, as discussed in detail in Part II.A, the law in this state guarantees the habitability of all rental residences. Although many local laws and regulations vary and impact damages, landlords throughout the state have strict liability to ensure their tenants reside in livable conditions. The law requires landlords to rebate rent for days when conditions were not habitable due to the Storm. Such rebates are discounted by the value of landlords' mitigation efforts. This much is not in dispute.

The question with which this court must grapple is how the vehicle of a class action can be used when so much of the damages sought— and damages are really all that is at issue— turn on fact specific inquiries, based on myriad variables such as where each building is located, how badly it was affected by the Storm, what mitigation efforts were made by the landlord, the terms of each tenant's lease, and so much more. But first, before there can be a class, there must be class representatives.

The Class Representatives

The first proposed class representative is Briana Adler. She lives in a 709-unit, 31-story, two-building luxury apartment complex, built in 1988, located at 155 East 31st Street in Manhattan (Windsor). The Complaint states that Windsor is owned by Ogden. This is not the case. Ogden is Windsor's managing agent. Windsor is actually owned by non-party Mastic Associates of New York LLC (Mastic),[3] a fact [976 N.Y.S.2d 862] stated in Adler's lease.[4] On October 1, 2012, Adler entered into a lease with Mastic for apartment 8A in Windsor. Adler's market-priced lease provides attorneys' fees to the prevailing party in a landlord-tenant dispute.

In anticipation of the Storm, Con Edison shut off Windsor's electricity at approximately 8:30 p.m. on October 29 and did not turn it back on until November 3 at approximately 2:00 am. During this time, there was no electricity in Adler's apartment. However, Windsor has an emergency generator, which was turned on immediately after Con Edison turned off its electricity. The generator provided power to the elevators (so that Adler would not have to climb 8 flights of stairs), lighting in the common areas, and water pumps (so that Adler could have running water in her faucets, toilets, and shower, and, by the afternoon of October 31, there was heat and hot water). Moreover, Windsor's tenants were provided with a host of free services to make the situation as bearable as possible. Such complimentary services included: (1) breakfast, lunch, snacks, and bottled water; (2) glow sticks; (3) charging stations in the lobby and service areas, so that tenants, such as Adler, could charge their cell phones, computers, and other electronic devices; and (4) building security to ensure that the only people on premises during this perilous time period were the tenants and their guests. Adler seeks a rent abatement for the time period when her apartment was " uninhabitable when [it] was without electricity, heat, hot water and/or elevator service." Moreover, she claims her circumstances are typical of the average New York State renter who suffered through the Storm.

The second proposed class representative is Lauren Shoenfeld. She also lives in a luxury apartment building (Washington Irving House), a 19-story building, built in 1963, located at 145 East 16th Street in Manhattan. According to the Complaint, Washington Irving House is owned by 145 East and Goldman and is managed by Solil. This also is inaccurate. 145 East is the owner; Goldman and Solil are managing agents. Shoenfeld's lease,[5] for apartment 11K, commenced on September 4, 2012. Shoenfeld, a college student, did not pay rent. Rent was paid by her parents and the parents of her roommates.[6] The unrebutted evidence demonstrates that Shoenfeld left Washington Irving House before the Storm, stayed nearby with friends and family, and returned after the Storm when conditions were back to normal.[7] Further, Shoenfeld happens to be the niece of plaintiffs' co-counsel, Harold Hoffman. Hoffman's son, Adam, posted the following on his Facebook page:

If you lost power during Hurricane Sandy you should not have paid rent in [976 N.Y.S.2d 863] full. You can claim your rent back by joining this case. There are no fees or costs. If interested, call or email Harold Hoffman, Esq. for more details at [his phone number and email address].
See Affidavit of Adam Goldblatt, dated March 20, 2013, ΒΆ 10. (Goldblatt Aff.).[8] Adam's brother, Joshua, also sent an email to his friends:
I am emailing to let you know that my dad is one of the lawyers for the plaintiffs in a Hurricane Sandy class action If any of you fall into the category of people who lost power during the Hurricane (in your N.Y. State apartment) and still had to pay rent, you may be entitled to a rent rebate. There is also the potential for approximately a $5K bonus payment. I have included my father's number and email address below-if you want to be a part of the class-action, feel free to email or call him. If you know of anyone else who may have lost power as well, feel free to forward the email or pass along the message.

The third proposed class representative is Perri Steiner. In 2012, Steiner lived in an apartment in a five-story, 21-unit walk-up, built in 1920, and located at 17 Stuyvesant Street in Manhattan (the Stuyvesant Building). Tres owns the Stuyvesant Building. Steiner's Lease, dated July 29, 2012, provides attorneys' fees to the prevailing party in a landlord-tenant dispute. Con Edison shut off the Stuyvesant Building's electricity between October 29 at 9:00 pm and November 2 at 5:00 pm. Though the Stuyvesant Building did not have heat during this time, the temperatures were in the fifties (and sometimes dropped into the forties at night). The tenants' stoves and hot water, which were not dependant on Con Edison electricity, remained operational. The Stuyvesant Building was visited daily by a manager to address the tenants' concerns. Regardless, Steiner was not subject to these conditions. She left her apartment before the Storm and did not return until either November 3 or 4, when the Stuyvesant Building's electricity was restored. Steiner permanently ...


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