In Rushmore case, appellate court rejects Extell and Carlyle’s claims

Ruling affirms $16M of escrow refunds that were ordered by Cuomo

TRD New York /
Dec.December 11, 2012 06:00 PM

A New York State appellate court ruled 5 to 0 that former Attorney General Andrew Cuomo correctly ordered refunds to 41 buyers at the Rushmore, a luxury condominium on Manhattan’s Upper West Side.

The development team, Extell Development and Carlyle Realty Partners, had appealed a ruling by Supreme Court Justice Anil Singh, who previously affirmed the ruling by Cuomo, which involved the rescission of more than $16 million in escrow deposits.

The developers were ordered to refund the money on the basis of missing a September 2008 deadline to hold a first closing on apartment sales at The 200 Riverside Boulevard tower. However, they argued that a simple one-digit typo led to an erroneous date in the condo offering plan, and said the buyers were truly motivated by the 2008 economic collapse, which led to a drop in home values.

Extell and Carlyle claimed in court papers that they asked Cuomo’s office for the right to cross-examine buyers to determine their true motivations, but that the State Attorney General’s office denied that request. Cuomo’s office countered in court papers that the offering plan was a document unilaterally drafted and edited, and that the buyer’s motivation was not a material event, because they had no part in drafting the plan.

“We hope that this will finally put an end to this case, which has dragged on much too long,” said Richard Cohen, who represents more than 30 of the buyers. “The time has certainly come for the Sponsor to return purchasers’ down payments.”

Ed Normand, a partner at Boies, Schiller & Flexner, which is representing Extell and Carlyle, said he had consulted with his client and that they would have no comment.

State Attorney General Eric Schneiderman, whose office took over the case after Cuomo was elected governor, was not immediately available for comment.

Lawyers for the remaining buyers were not immediately available for comment, but were working on a statement.


Related Articles

arrow_forward_ios
One Manhattan Square Extell Development CEO Gary Barnett (Credit: Curbed NY)

Extell lands $690M refinancing package for One Manhattan Square

Extell lands $690M refinancing package for One Manhattan Square
Extell's Gary Barnett and a rendering of 50 West 66th Street (Courtesy of Snøhetta)

Judge throws cold water on Extell’s UWS condo development

Judge throws cold water on Extell’s UWS condo development
Carlyle CEO Kewsong Lee and 24-02 Queens Plaza South in Long Island City (Getty; Atlas Capital)

Carlyle Group pockets $40M LIC trade school building

Carlyle Group pockets $40M LIC trade school building
Tel Aviv Stock Exchange bull (Wikimedia Commons)

NYC developers face downgrades on Israeli bond market

NYC developers face downgrades on Israeli bond market
Claude Wasserstein and 995 Fifth Avenue (Getty, Google Maps, Sotheby's)

Claude Wasserstein relists UES penthouse for $55M

Claude Wasserstein relists UES penthouse for $55M
Gary Barnett and Sush Torgalkar with 225 West 57th Street, 225 West 86th Street, and 169 Columbia Heights in Brooklyn (Credit: Getty Images, iStock, and CityRealty)

Torgalkar out as CEO of Extell: sources

Torgalkar out as CEO of Extell: sources
Extell Development president Gary Barnett and Kushner Companies founder Charles Kushner with a rendering The Lofts at Pier Village in New Jersey (Rendering via Extell Development)

Kushner Cos. buys Gary Barnett out of development on NJ waterfront

Kushner Cos. buys Gary Barnett out of development on NJ waterfront
HNA Group’s Guoqing Chen, One57 and  and Gary Barnett (Godsfriendchuck via Wikipedia)

HNA’s fire sale continues with One57 deal

HNA’s fire sale continues with One57 deal
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...