Stuy Town tenant settlement OK’d by court

Apr.April 10, 2013 04:00 PM

A New York state judge today approved a $68.8 million settlement in the Stuyvesant Town-Peter Cooper Village tenant class action, in which residents alleged that the complex’s owners had improperly deregulated rent-stabilized units, according to Wolf Haldenstein Adler Freeman & Herz LLP, co-lead counsel for the plaintiffs.

The ruling brings an end to the long-running lawsuit at the 11,000-unit complex, and paves the way for roughly 27,500 tenants to receive payments spanning from $150 to more than $100,000 for rent paid during a nearly nine-year period.

The deal, worth an estimated $173 million with other rent breaks factored in, marks the largest tenant settlement in the nation, Wolf Haldenstein said.

The residents, led by tenant Amy Roberts, filed the class action in 2007, claiming that insurer MetLife and Tishman Speyer, which had owned the complex at different times before 2010, deregulated the units while taking J-51 tax benefits. A judge ruled that this was improper, and the decision was later upheld on appeal.

The settlement puts aside $68.8 million to compensate members of the class for the rent payments. CWCapital, a special servicer that now controls the property, will cover $58.3 million, while MetLife will contribute $10.5 million.

Tenants will get “refunds equaling at least 100 percent and, most likely up to 110 percent, of their overcharges,” said Daniel Kasner, an attorney for the plaintiffs, in the release, adding that most or all of the attorneys’ fees are slated to be paid from excess funds.

The settlement also ensures that 4,311 of the formerly decontrolled units will remain rent stabilized through June 2020, when the J-51 benefits expire.

Two Stuy Town residents previously asked a judge to block the settlement, citing high legal fees and the fact that some residents would receive only $150 from the deal. —Zachary Kussin

Related Articles

Blackstone CEO Steven Schwartzman and Stuyvesant Town (Credit: Getty Images)

After authorities vowed review of Stuy Town deal, Blackstone changes course on vacancies

The Wheeler at 181 Livingston Street with Tishman Speyer's Rob Speyer (Credit: The Wheeler, Getty Images)

For-profit Whittle School inks lease for Tishman Speyer’s The Wheeler

The Spiral and Debevoise presiding partner Michael W. Blair (Credit: Tishman Speyer)

Debevoise signs big lease at Tishman Speyer’s Spiral

Related chairman Stephen Ross with 30 Hudson Yards, 1633 Broadway and 55 Hudson Yards (Credit: Getty Images, Paramount, Wikipedia)

Here were NYC’s largest real estate finance deals of 2019

50 Rockefeller Plaza and Katten's Chris DiAngelo (Credit: Google and Katten)

Katten law firm moving to Rockefeller Center

From left: Jonathan Gray and Steve Schwarzman with Stuyvesant Town

Behind Blackstone’s “capital strike”

Clockwise from the top left: Jackson Park at 28-40 Jackson Avenue, 240 Willoughby Street in Fort Greene, 664 Pacific Street in Brooklyn, and 247 Metropolitan Avenue in Williamsburg (Credit: StreetEasy, Google Maps, Pacific Park Brooklyn, The Pod Hotel)

These were the top 10 outer-borough loans last month

October Issue is Live

The Real Deal‘s October issue is now available to subscribers!