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Dec. 02, 2020

Kramer Levin Represents Sutton 58 Associates LLC in Successful Appeal Before New York Court of Appeals

On Nov. 24, 2020, the New York Court of Appeals reinstated a lawsuit brought by Sutton 58 Associates LLC, an affiliate of Gamma Real Estate, against real estate investor Philip Pilevsky, his sons and related entities. The suit seeks approximately $100 million in damages against the Pilevskys for tortious interference with Gamma’s loan agreements with the original developer of a proposed residential tower on Sutton Place and 58th Street. The Pilevskys moved for summary judgment dismissing the case, and the motion was initially denied by the trial court. In 2019, that decision was reversed, and the case was dismissed by the Appellate Division, First Department, which found that Gamma’s damages resulted from the original developer’s bankruptcy filings and that Gamma’s claims were therefore preempted by the Bankruptcy Code. In reinstating the complaint, the Court of Appeals held that Gamma’s “allegations state a claim for tortious interference with contract, and the remedy for that tort will not affect the debtor’s estate. As such, these claims will not encroach upon the province of the bankruptcy court.”

A copy of the Court of Appeals’ opinion is available here.

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