Renegade Media, a New Jersey-based media buying firm, has filed a lawsuit against the developer of Long Island City’s Arris Lofts for breach of contract, claiming more than $170,000 in unpaid expenses and fees.
The suit, filed yesterday in New York State Supreme Court, alleges that the developer, the Andalex Group, has not paid for Arris Lofts advertisements Renegade placed on the developer’s behalf in the New York Times and the New York Post, as well as other fees. The suit also names Andalex Group affiliate TAG Court Square, the owner of Arris Lofts.
“[The] defendants have never challenged or questioned the accuracy of any of the above-described invoices,” the suit says. “Yet, [the] defendants failed and refused, and still fail and refuse, to pay for Renegade’s services, and to satisfy the invoices without valid excuse or justification.”
The suit asks for damages in the amount of $170,657.40, plus interest and legal fees.
Tag Court Square is also involved in litigation with a contractor at Arris Lofts, Pavarini McGovern, which filed a $13.1 million mechanic’s lien on the property in August 2007, claiming it had been fired from the Long Island City project after a dispute over its construction. In September of 2008, a judge reduced the lien to $5.6 million, after the developer filed a motion challenging the original claim.
Pat Durkin, the president and founder of Renegade Media, said she has a signed contract with Andalex dated January 29, 2007, to provide media buying services for Arris Lofts.
Durkin, a former advertising executive who founded Renegade in 1997, said she placed the ads at the direction of Alexander Silverman, Andalex’s COO, and said they were “long, full-column ads.”
Her attorney, Jacques Catafago, said approximately $150,000 of the unpaid fees were for expenses, and the rest was the commission Durkin, who works out of her home, charges for her services.
Durkin said she paid for the ads out-of-pocket, which is the usual procedure with all her clients. Most reimburse her within 30 days; Andalex, too, was always timely with payments until October 2008, the last time she said she received payment from Andalex for her services.
“They never terminated the agreement, they’ve never questioned an invoice, they just stopped paying and then they stopped communicating,” she said. “I’m going to have to mortgage my house. It’s a lot of money — it’s my operating fund.”
Arris Lofts, a 250-unit building located at 27-28 Thomson Avenue, is 90 percent sold, according Tom Le, a vice president and associate broker at the Corcoran Group, who is overseeing sales in the building.
Catafago said he has been talking with the developer’s representatives for the last two weeks and had asked for payment by this week. “They didn’t come close,” he said. “More importantly, they gave no justification whatsoever for withholding even a penny.”
He said he has received e-mails from the developer’s in-house comptroller acknowledging the debt and promising payment.
“A small business is out $170,000 for no good reason other than they trusted Andalex,” Catafago said. “We gave them every opportunity to do the right thing, and now we will let the court decide.”
William Kogan, general counsel at the Andalex Group, was not immediately available for comment. Reached by telephone last night, Silverman, Andalex’s COO, declined to speak on the record about the suit.