Malone petitions court in effort to collect $6.7M judgment against Langer, partners

Georgia Malone’s brokerage George Malone & Company filed a petition Friday asking a New York State Supreme Court judge to help the firm collect on a $6.7 million judgment awarded in February 2024 that followed 10 years of litigation in which the firm battled major multifamily owner Irving Langer and his partners, who did not pay a $3.4 million brokerage commission after they bought an 87-building portfolio in Harlem in 2013 for $340 million.

New case LINK
Original case 150660/2014 LINK

According to court records, Langer and partners never paid the commission, arguing that no commission was due because the buying entity companies were not the specific entities the parties had agreed to before the sale. Malone sued in 2014 to collect the commission, and Langer won in the lower court which dismissed the case in 2017. But Malone appealed to the Appellate Division, which ordered the lower court to reopen the case. In February 2024, a State Supreme Court jury awarded Malone the $3.4 million commission plus interest, as The Real Deal reported at the time. The judgment is now $6.7 million, according to the petition filed Friday. The defendants in that case are in the process of appealing that decision.

The properties include 610-620 West 141st Street, 145-153 Edgecombe Avenue, 337 West 138th Street, 303-305 West 111th Street, 707 St. Nicholas Avenue, 2010 7th Avenue, 1829-1831 Adam Clayton Powell Boulevard and 557 West 149th Street.

The petition is asking a judge to block the transfer of 13 properties that were part of the 87-building portfolio. Most of that 2013 portfolio was sold between 2014 and 2019 for an $80 million paper profit, the filings show, but some properties such as these 13, were not sold. Instead, the properties declined in value following the passing of the 2019 rent laws. In July 2021, investor David Brecher, the principal of FM Capital, “took control” of most or all of these 13 properties, according to an an August 2024 affidavit of Eli Bobker, an attorney and director with FM Capital. Brecher signed as authorized signatory for the 13 properties, which were security for a $64 million loan Arbor Realty Trust provided in August 2021.

Brecher is not a party in the commission litigation and is not liable for it, according to court records. Furthermore, considering the decline in values in recent years, the $64 million loan is under water.

But by January 2024, according to the Bobker affidavit, “Mr. Brecher no longer was in a position to continue funding shortfalls (especially debt service) and advised Arbor Realty Trust of the same. Mr. Brecher offered Arbor Realty Trust a deed-in-lieu of foreclosure, and was willing to “cut losses” and walk away from the deal… Rather than accepting the deed-in-lieu, Arbor Realty Trust requested that Mr. Brecher bring in a partner and modify the existing loan.” It is unclear from city property records if the loan was modified. No mortgage modification documents have been filed as of publication, though the properties did transfer to new entities in April 2024.

Despite that zero-dollar transfer in April 2024, Malone does not believe the ownership was truly transferred, since the transferring entity was not the complete owner of the properties.

“Thus, based on the Judgment Debtors’ own documentation, since Zaidys Manhattanville LLC did not own 100% of Manhattanville Holdings LLC, it did not have the authority to transfer control of Manhattanville Holdings LLC to FM Capital. Since Manhattanville Holdings LLC does not own the Portfolio, FMCapital never received any assignment or rights of the real property at issue and no documentation regarding such transfers has been produced to date,” the petition says.

Court cases represent the position of one party and are not necessarily accurate or complete.

According to the complaint, “Contrary to the Judgment Creditors’ claim that they are insolvent, by paying at least $3,700,000.00 in legal fees defending the Georgia Malone & Company Litigation by raising fraudulent and baseless defenses, the Judgment Creditors’ claim of insolvency is further evidence of the fraud that they continue to perpetrate on the Court.”

Some of the defendants in the case are filing another appeal. According to papers filed by Morrison Cohen, the defendants want the Appellate Court to consider, “Whether the Court below erred in its pre-trial and trial rulings, including with respect to: (1) denying defendants’ motions in limine, (2) limiting the issues to be presented to the jury; (3) refusing to permit cross-examination of defendant with prior sworn inconsistent statements, (4) refusing to accept Defendants’ proposed requests to charge, including with respect to the issue of contractual ambiguity, and (5) denying Defendants’ evidentiary objections both prior to and during trial. Defendants seek vacatur of the jury verdict and judgment and a new trial.”

Direct link to the property’s ACRIS page.