October 29, 2024
On October 23, 2024, Schlam Stone & Dolan attorneys Joshua Wurtzel, Erik Groothuis, and Paul Stretton won a motion for summary judgment in lieu of complaint against prominent New York developers Aby Rosen and Michael Fuchs on a claim for breach of guaranty, with the court directing the entry of a judgment for over $18 million, plus attorneys’ fees, against the guarantors.
The suit arose from borrower defaults under two separate mezzanine loans that Schlam Stone’s clients, two Korean investment trusts, made in 2017. Rosen and Fuchs, as principals of the borrowers, guaranteed certain obligations under the loan documents, and so Schlam Stone moved for summary judgment in lieu of complaint under C.P.L.R. 3213 for these guaranteed amounts.
The guarantors resisted the motion by arguing that the guaranties at issue included performance, in addition to payment, obligations, and thus did not qualify as instruments for the payment of money only under C.P.L.R. 3213. And the guarantors also argued that Schlam Stone’s clients lacked standing and capacity to bring the claims at issue.
But Justice Anar Rathod Patel of the New York County Commercial Division rejected the guarantors’ arguments, holding that the guaranties were in fact instruments for the payment of money only and that, in the guaranties, the guarantors had waived all other defenses.
The Schlam Stone attorneys were joined in this success by their clients’ advisors Jin Kim and Artem Volgaev of BridgeRock Capital and Eric Assimakopoulos and Inga Heynen of Revetas Capital.
Read the full decision here.