Litigation round up: Omnibuild sues McSam; insurer seeks $10M deposit from HFZ

Litigation roundup: There were three contractual lawsuits of note, including Sam Chang’s McSam Hotel Group and HFZ Capital Group.

There were five commercial mortgage foreclosures filed yesterday totaling $3.2 million, with three in Queens and two in Brooklyn. The highest value loan was $780,000.

Legal filings in New York State Court are representations from the point of view of the plaintiff and are not necessarily complete or accurate.

-Construction manager Omnibuild accuses an affiliate of Sam Chang’s McSam Hotel Group, 16 East 39th Street LLC, of having an unpaid balance due of $4.1 million at the hotel development site 16 East 39th Street, in Midtown. The TCO filed for on August 22, 2019, but has not been issued. Chang filed plans in 2015 for the 162-key hotel. Link to case.

-An insurer of surety bonds for 11 of HFZ Capital Group’s LLCs said it needs an additional $10 million, citing claims against its bonds. “To date, Atlantic Specialty has received six claims against bonds it executed on behalf of certain of Defendants in connection with the Projects. Atlantic Specialty believes and expects that additional claims against its bonds are imminent. By letter dated December 10, 2020, Atlantic Specialty demanded that Defendants perform their obligation under paragraph 3 of the Indemnity Agreement and deposit collateral security in the total amount of $10,000,000.00 with Atlantic Specialty.” Link to case.

-The owner of the 24,200-square-foot commercial building at 25-45 Borden Avenue in Long Island City, Queens, accused the tenant of breaching the lease, and seeks $902,203. Link to case.