This real estate investor is suing his partner for pocketing rental income

Lawsuit claims David Kushner funneled funds dating back to 2015
By Meenal Vamburkar | April 10, 2019 08:30AM

 

David Kushner (left) and Marc Gleitman (right) (Credit: Mercury Capital)

David Kushner (left) and Marc Gleitman (right) (Credit: Mercury Capital)

Since 2015, a New Jersey real estate investor has allegedly pocketed rental income from two properties. Now one of his partners is suing for more than $2.5 million after discovering the stolen payments late last year.

Marc Gleitman filed the civil complaint Wednesday in New York State Supreme Court — individually and on behalf of Review-Railroad Realty LLC and 37-80 Review LLC — against David Kushner and Lujabri 2 Corp., an entity that Kushner allegedly controls. Gleitman and Kushner both had one-third ownership in the LLCs, along with their third partner, Jeffrey Meshel.

Gleitman is the co-founder of Mercury Capital, which provides financing for commercial real estate properties.

The LLCs own the industrial property at 31-30 Review Avenue in Long Island City, as well as the adjacent lot. Kushner’s responsibilities, according to Gleitman’s complaint, were to “collect rents from tenants and to allocate to each member the appropriate distributions from net revenues.”

The lawsuit claims that Kushner instead funneled the rental income through Lujabri 2. As of September 2015, or possibly earlier, Kushner diverted to himself between $25,000 to $26,000 in rental revenues per month, the complaint said. Gleitman accuses Kushner of pocketing more than $1 million to date. Kushner also allegedly granted an easement on behalf of the LLCs, for which he received $1.45 million. That deal was made without consulting the other partners, according to Gleitman’s lawsuit.

“The conduct of Kushner was intentional, wanton, oppressive, malicious and shocking to the conscience, and was perpetrated in complete disregard of plaintiff’s rights,” the complaint said.

Gleitman is seeking compensatory damages and punitive damages of at least $2.5 million. Gleitman and Kushner couldn’t immediately be reached for comment.

Kushner runs Paradigm Capital Group in Cresskill, New Jersey. The firm provides bridge loans for real estate development projects and claims to have loan amounts ranging from $1 million to $20 million. He has also faced legal troubles in the past.

In 2017, Kushner and his wife were hit with a nearly $700,000 judgment over unpaid federal taxes, according to NorthJersey.com.

The previous year, a racketeering lawsuit against Kushner was thrown out of court because a four-year statute of limitations had run out. That matter involved a venture that solicited investments in risky real estate loans.

Kushner also pleaded guilty in early 2016 to charges of charges of harassing his son’s basketball coach at Cresskill High School.