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New York

Gary Barnett retracts lawsuit after partners show receipts

Emails from Extell founder's nephew proves firm was informed of building sales

Gary Barnett with 186-190 21st Street
Gary Barnett with 186-190 21st Street (Google Maps, Getty)

In the brouhaha between Gary Barnett and two business partners, the partners had the last ha-ha.

The Extell Development founder discontinued a lawsuit he had filed against Yoel Weber and Yoel Leonorovitz after their attorneys disproved the allegations with a series of emails. Barnett had alleged that he was never told about a $6 million sale of two Brooklyn properties they had bought together.

Barnett, Weber and Leonorovitz in 2011 formed 186-190 21st St LLC, through which each owned one-third of commercial buildings at 186 and 190 21st Street in Greenwood Heights. Three years later, the trio entered into an agreement about how the properties would be owned and managed.

In 2015, the properties were sold to 21st Development Group LLC, according to the deed. Property records show 186 21st Street was converted to an apartment building in 2017.

Barnett sued last week, claiming he was unaware of the sale and that Weber and Leonorovitz failed to wind up and liquidate the company, as required by the operating agreement. Instead, the suit alleged, Weber and Leonorovitz took control of the sale proceeds and maintained control of the LLC’s operations.

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Weber and Leonorovitz’s attorneys at Nicoletti Hornig & Sweeney rebutted what they called the “numerous false allegations” by turning up a series of emails, which were viewed by The Real Deal.

Both the sale of the 186-190 properties and the purchase of 4101 property was “orchestrated by Abba Barnett of Extell at the direction of Gary Barnett,” according to John Nicoletti, the lead attorney for Weber and Leonorovitz. Abba is the CEO’s nephew and vice president of acquisitions at Extell.

In an email sent March 9, 2015, Barnett’s nephew discussed with Weber and Leonorovitz the contracts for the sale of 186 21st St and for the purchase of a Sunset Park property, 4101 First Avenue. Subsequent emails make clear that the nephew — who did not respond to The Real Deal’s requests for comment — had extensive knowledge of the deal.

In his lawsuit, Barnett said he was “not, at the time, made aware” of the deal. He did not specify when he was made aware, though the suit appears to suggest he only found out about it seven years later.

The lawsuit was ended Sept. 14, the same day the evidence was sent to Barnett’s attorneys, who did not respond to requests for comment. Representatives for Extell also did not respond to inquiries.

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Commercial Real EstateExtell DevelopmentLawsuit