City Realty Goes After Lender for Alleged Online Disclosures

A trio of Boston developers are not happy with their lender, who allegedly spilled personal information to a loan sale platform.

On Friday, City Realty Group co-founders Fred Starikov and Stephen Whalen, as well as Matthew Zuker, filed a lawsuit against Eastern Bank in Suffolk Superior Court, the Banker & Tradesman reported. The three plaintiffs accused the bank of “intentionally (and without authorization) disclosing highly confidential, nonpublic, personal financial information, including personal financial statements.”

Things between the two sides weren’t always thorny. In 2021, the development trio identified an opportunity in Weston, seeing a chance to turn a senior living facility into a substance abuse recovery center. After making the deal, they applied for a $29 million construction loan and $2 million line of credit from HarborOne Bank, according to the lawsuit, obtaining a mortgage in August of that year (HarborOne was later acquired by Eastern).

But in April, personal financial statements and other confidential information for the developers dating back to the beginning of 2025 was allegedly posted on DebtX, a portal where loan sales take place. Eastern allegedly sought to sell the construction loan in question and the platform supposedly allowed public access to a summary of the developer’s assets.

Upon discovering the information online, City Realty’s counsel demanded Eastern remove the personal information from DebtX, which it allegedly declined to do. In an exhibit in the lawsuit, the bank’s counsel said the information in question was involved in “confidential communications with qualified prospective purchases who signed a standard nondisclosure agreement,” adding that it “did not authorize dissemination of materials outside the controlled diligence process.”

A lawyer for the plaintiffs said the actions of the defendant “[have] and will cause significant harm to the plaintiffs and their businesses.” In addition to monetary damages, the developers want a preliminary injunction to force the removal of their information from the DebtX platform.

City Realty is having a decent month outside of the lawsuit.

Brookline’s annual town meeting saw the Chestnut Hill Commercial Area Study easily approved by a 217-20 margin, clearing the path for a major development in the Boston suburb.

City Realty is planning a three-building mixed-use complex that will include a 200-room hotel, 266 apartments or condo units, medical office space and retail space.

— Holden Walter-Warner