Wolf Haldenstein Wins Major Victory for Tenants in Landmark NYS Court of Appeals Decision in Stuyvesant Town-Peter Cooper Village Class Action

October 22, 2009 (New York, NY) – Wolf Haldenstein Adler Freeman & Herz achieved a major victory for eight clients and a putative class of thousands of market rate tenants when the New York State Court of Appeals ruled in favor of tenants of Stuyvesant Town – Peter Cooper Village who brought a class action to block the landlord of the residential complex from de-regulating rents for apartments in buildings that had received certain tax incentives.

A four judge majority of the Court held that Tishman Speyer Properties and MetLife, the former landlord, had illegally deregulated and raised rents at approximately 4,000 apartments in buildings where New York City J-51 tax benefits had been granted. The opinion affirmed a March 2009 ruling by the Appellate Division, which had unanimously reinstated a class action complaint for rent overcharges filed in 2007.

The Class Action asserts that the landlords have for many years illegally charged market rate rents for apartments that should have been rent stabilized under New York City’s Rent Stabilization Law, thereby overcharging each affected tenant from hundreds to tens of thousands of dollars per year. The central legal issue was whether the landlords could permissibly deregulate and charge market rents for certain so-called “luxury” apartment units in the complexes in years in which the landlords were receiving J-51 benefits.

“The Court of Appeals decision is a tremendous victory for the nine tenants who courageously stepped forward when their landlord attempted to deny them and their neighbors of their right to live in a rent stabilized apartment at Stuyvesant Town or Peter Cooper Village,” said Wolf Haldenstein partner Alexander H. Schmidt, who represented the tenants. “The opinion clearly and strongly states that a landlord who receives certain tax benefits from New York City for improving a building cannot then remove apartments in that building from rent stabilization protection.”

The Court’s decision has been hailed as a landmark ruling that will potentially benefit thousands of other tenants around New York City who were also wrongly removed from rent stabilization by landlords who received the same J-51 tax benefits that the landlords of Stuyvesant Town and Peter Cooper Village did. The four judge majority found that the statutory scheme plainly and unambiguously prevents landlords of rent stabilized buildings from charging market rents while receiving J-51 benefits for as long as they continue to receive those tax breaks.

Mr. Schmidt noted that the Court of Appeals has remanded to the trial court the question of awarding damages. “In our view, the tenants are entitled to have their past years of rent overpayments refunded. We fully expect to return shortly to the trial court to begin that process, which may be prolonged,” he said.

The case is Roberts v. Tishman Speyer, L.P., et al., N.Y. Sup. Ct., N.Y. Co. Index No. 100956/07. A copy of the court's decision can be viewed here. For a list of Frequently Asked Questions concerning the case, click here.

Wolf Haldenstein Adler Freeman & Herz LLP is a full-service law firm that has provided legal services to its clients since 1888. It has practice groups in the following areas: Class Action Litigation , Real Estate , Corporate and Business ,Health Care , Not-for-Profit Organizations ,Employee Benefits, Tax, REITs and Limited Partnerships ,Trusts and Estates, Accounts Receivable Management and Commercial Collections and General Litigation.

Press Contact: Ned Steele, MediaImpact, 646-234-5070 mediaimpact.ned@gmail.com