News

Schlam Stone partners Jeffrey Eilender and Erik Groothuis filed a breach of contract claim against prominent Brooklyn-based sports agency Athletes’ Careers Enhanced and Secured, Inc. (“ACES”) as well as tort claims against ACES’s two principals, Sam and Seth Levinson, on behalf of the firm’s client, Juan Carlos Nunez. Nunez alleges that ACES and the Levinsons forced him to violate baseball’s rules while servicing ACES clients, including making illegal under-the-table payments and helping the players obtain and use steroids. The suit seeks over $3 million in unpaid commissions and expense reimbursements. The lawsuit has already received back-page coverage in the New York Daily News as well as in a number of national media outlets.

Schlam Stone & Dolan partner Jeffrey M. Eilender and associate Lee J. Rubin were contributors to the recently-released 2017 Supplement to Litigating the Business Divorce by Kurt Heyman and Melissa Donimirski. Jeff and Lee contributed to the section of the supplement relating to challenging a dissolution.

Schlam Stone's leading role in the precedent-setting Kassab litigation continues to attract media attention. Here, SSD partner Jeffrey Eilender is interviewed by the New York Business Divorce blog in a podcast about the most recent post-trial ruling, which found that dissolution was warranted and awarded the minority owner (Schlam Stone's client) about $4 million in a buyout. The Kassab action arose from a total breakdown of the relationship between two brothers, who were the co-owners of a real estate holding company, and significant Queens County Commercial Division and Appellate Division rulings in the case can be reviewed here, here, here, and here.

Opening statements in the civil trial between the producers of the musical "Rebecca" and their former publicist attracted widespread media attention, including coverage in the New York Times, the Broadway Journal, and Deadline Hollywood. The producers, who are represented by Schlam Stone & Dolan partners Erik Groothuis and Jonathan Mazer, allege that the production's former publicist sent anonymous, false emails trashing the production to a potential investor, resulting in the show falling apart just before commencing rehearsals. An appellate court has already ruled that the publicist breached his contract with the production, and the two to three-week jury trial will decide damages for that claim, as well as liability and damages for two related tort claims.

On December 20 and 21, 2016, the New York Law Journal and the New York Post reported on a lawsuit filed by Schlam Stone & Dolan on behalf of CABS Nursing Home, Inc., in the Kings County Supreme Court, Commercial Division. The lawsuit alleges that CABS was defrauded into selling the nursing home to the Allure Group, based on representations that Allure would continue to operate the nursing home. Instead, Allure immediately tried to close the nursing home and flip it to a developer in order to build luxury apartments. The lawsuit seeks rescission of the sale or in the alternative compensatory and punitive damages. Schlam Stone & Dolan Partner Jeffrey Eilender was quoted by the Law Journal, saying “the only reason CABS ever entertained any proposal by the Allure Group was because the Allure Group marketed themselves as being in the nursing home business. Its entire mission was to help the Bed Stuy community.” CABS is being represented by Mr. Eilender, Bradley Nash, Samuel Butt and Seth Allen.

Schlam Stone attorneys Ronald Russo and Erik Groothuis appeared on behalf of the firm’s clients Rebecca Broadway LP and Ben Sprecher in an August 2016 episode of CNBC’s American Greed. The episode, titled “The Phantom Fraudster of Broadway,” detailed the crimes of con man Mark Christopher Hotton, who pleaded guilty to defrauding the Rebecca production, and Mr. Russo's role in bringing him to justice. CNBC's website has both print and video coverage of the story.

Schlam Stone partner Elizabeth Wolstein was quoted in a lead article in the Greater New York section of the May 20, 2016, Wall Street Journal, which reported on Mayor Bill de Blasio’s decision to shield emails between his administration and outside advisors from public disclosure. Although the advisors are not paid by the City, the Mayor has designated them as "agents" of the City in an effort to bring them within a Freedom of Information Law (FOIL) exemption that allows agencies to withhold correspondence between government agencies from the public. Noting that Elizabeth was the lawyer who "won the case that forced" the Bloomberg administration to release emails between the Mayor's Office and former Schools Chancellor Cathie Black, the article ends by quoting Elizabeth's assessment that the Mayor's correspondence with outside parties paid by others to conduct business with the City "seems like exactly the thing you'd want disclosure on."

On May 9, 2016, the New York Law Journal reported on Dean Joan Wexler’s move to Schlam Stone & Dolan. Ms. Wexler was previously Dean of Brooklyn Law School and President of the Federal Bar Council.

In February of 2015, Schlam Stone & Dolan won a tremendous victory for client Winston Chiu in Chiu v. Chiu in the Appellate Division, Second Department concerning his withdrawal and payout as a member of an LLC that owned real estate in Long Island City. As a result of the firm's efforts, Mr. Chiu obtained over $4 million and the firm made new law on the valuation of minority interests in business divorce cases. The Second Department Decision was listed as one of the #1 business divorce case of 2015 on Peter Mahler's blog, New York Business Divorce, the preeminent blog in this area of the law.

On December 18, 2015 the firm won a significant dismissal of a $27 million RICO case brought by the New York State Catholic Health Plan against our client, Academy Orthotic & Prosthetics Associates, IPA and its principals. The Health Plan argued that it was defrauded in violation of RICO because it paid millions of dollars in claims to Academy thinking it was a provider of medical equipment when in actuality it was a network of medical equipment providers. Judge Jack B. Weinstein granted SSD's dismissal motion in a 52 page decision on the basis that the fraud predicates were duplicative of the contract between the parties and that no deception occurred as a matter of law, and thus there could be no RICO or common law fraud claims.