Trial Victory Clears Path for Sale of Properties in Brooklyn by Haynes and Boone Client

08/04/2014


NEW YORK – A team of Haynes and Boone, LLP litigators successfully represented Metroeb Realty 1, LLC in a lawsuit that sought to force Metroeb Realty to sell properties located in Brooklyn, N.Y. to Metropolitan Lofts of New York, LLC.

Metropolitan Lofts commenced an action against Metroeb Realty in October 2012 seeking to enforce a purported agreement to purchase properties owned by Metroeb Realty in the Williamsburg section of Brooklyn for $30 million. Metroeb Realty denied that the signed agreement Metropolitan Lofts sought to enforce was valid and binding.

In connection with the suit, the court issued a preliminary injunction preventing Metroeb Realty from selling the properties and requiring Metropolitan Lofts to secure a $3 million bond to protect Metroeb Realty from damages it would incur as a result of the injunction should Metroeb Realty prevail at trial.

After the trial, Justice Ann T. Pfau (Commercial Division Justice, Supreme Court for the State of New York, Kings County) issued a 27-page decision in which she determined that the agreement Metropolitan Lofts sought to enforce was not binding and enforceable. Judge Pfau found arguments made by Haynes and Boone at trial to be persuasive, including the fact that the parties signed different versions of the agreement, there was no intent to enter into a binding contract when the agreement Metropolitan Lofts sought to enforce was signed, and the parties’ actions following the signing of the agreement were inconsistent with having entered into a binding contract for sale of the properties.

This decision cleared the way for Metroeb Realty to sell the properties to RedSky Capital, LLC at a higher price in a transaction that closed in July.

Based on the court’s decision, Metroeb Realty is also entitled to recover the damages it incurred, including recovery of its legal fees.

The Haynes and Boone trial team consisted of New York Partner Ken Rubinstein and Associates Sarah Jacobson and Joe Lawlor.

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