Shvo is seeking to kick Core Club to the curb.
Michael Shvo’s firm started the process of evicting the exclusive members-only club from 711 Fifth Avenue, the former Coca-Cola Building.
The luxury developer and the ritzy social club have been engulfed in a gripping legal drama. In 2024, Core Club alleged Shvo’s team over-promised and under-delivered on opening three club locations and sued Shvo for $600 million in damages. Shvo struck back, calling the lawsuit a “public hit job” intended to yield a rent reduction and other concessions.
“We have made every effort to keep Core Club in the building,” said Morris Missry, Wachtel Missry, an attorney representing Shvo. “However, the tenant’s ongoing inability, or unwillingness, to meet its lease obligations has left us with no choice but to initiate the eviction process.”
In the background, Shvo is facing other issues, including negative headlines over his marquee Raleigh condo and hotel in Miami Beach, which could be sold after slow sales.
Separately, Shvo is in a dispute with his big-money German backers. Shvo has filed an arbitration claim, alleging he is owed more than $85 million in fees from the German pension fund BVK.
Core Club’s new attorney Marc Kasowitz, the company’s third law firm in less than a year, claimed Shvo’s attempt to evict Core Club is pinned to these broader issues.
“What convenient timing for a baseless claim targeting CORE: to be pushed to the press within hours of the Wall Street Journal publishing that ‘Shvo’s property empire is starting to crumble,’ said Kasowitz in a statement. “This is nothing more than a desperate stunt by a convicted felon, seeking to deflect attention from his mounting international legal troubles as his real estate portfolio steadily unravels.”
The litigation with Core Club, encompassing two lawsuits, has been ongoing for over a year. So far, Shvo is winning.
In a one lawsuit, a New York state judge recently ordered Core Club to pay Shvo close to $1 million. Core Club secured a $750,000 loan from Shvo in 2022, but the members-only club allegedly defaulted a year later when Core Club’s location on Manhattan’s Fifth Avenue opened up.
Core Club accused Shvo of a “complex, fraudulent scheme” to gain control of its business. A New York Supreme Court judge said those defenses were not applicable. Core Club is appealing the ruling.
Shvo and Core Club are still duking it out in the other lawsuit.
Core Club alleges Shvo misled the company’s leadership about his ownership in 711 Fifth Avenue and San Francisco’s Transamerica Pyramid, as well as plans for a $100 million buildout. The owners have demanded Shvo and his partners reduce the club’s Manhattan rent, rescind its lease at Shvo’s Transamerica Pyramid and pay $600 million in damages.
Core Club further alleges Shvo racked up an $80,000 tab at its restaurant and used spaces for events for a kid’s birthday party and weekly religious group meetings.
Shvo fired back, alleging the Core Club’s fraud claims contradicted written agreements. The club’s leases in New York and San Francisco were promised only $50 million in construction allowances, according to Shvo’s filing.
In an unusual twist to the legal proceedings, Core Club’s initial lawyer admitted to using artificial intelligence, which produced fake legal citations. He was instructed by the court to pay the landlord’s legal fees.
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