Yoel Goldman sues partner Zelig Weiss over upcoming William Vale arbitration

Yoel Goldman is suing partner Zelig Weiss over the 185,141-square-foot William Vale hotel at 111 North 12th Street in Williamsburg, Brooklyn. Goldman seeks an order authorizing and mandating disclosure in aid of the forthcoming arbitration, as well as an order enjoining Weiss from destroying records in the interim.

Court filings are the positions of one party and are not necessarily accurate or complete. The case narrative below is from the Goldman petition, and therefore has a bias toward Goldman.

According to the complaint, “Since the project’s inception in 2013, Goldman arranged funding for the Hotel venture without any, or any meaningful, financial contribution from Weiss. Under their explicit agreements, Goldman has extensive rights to information about the operations and finances of the Hotel venture and express approval rights regarding fundamental decisions impacting their joint venture. Despite these unequivocal rights—and Goldman’s repeated attempts to invoke them— Weiss has repeatedly stonewalled Goldman’s attempts to get information and mismanaged the Hotel venture for his own benefit—in direct violation of the Parties’ written agreements and Weiss’s fiduciary obligations to Goldman…

“In fact, Weiss is already subject to a contempt motion in a separate state court litigation with another party for his failure to disclose some of the same Hotel-related financial information, to which Goldman is also entitled and has also unsuccessfully sought from Weiss.

“As described herein, this ongoing pattern of unlawful activity is part of a scheme by Weiss to enrich himself to the exclusion of Goldman. Now, Weiss’s actions threaten irreversibly to dispossess Goldman of his interests in the Hotel venture. Goldman holds his interests in the fee ownership indirectly through All Year Holdings Limited (“AYH”), a real estate holding entity now in bankruptcy – meaning those interests will be disposed of through the bankruptcy process, along with AYH’s many other valuable assets. Weiss holds his interests in the fee ownership personally. Thus, in summary, the fee is now half-owned indirectly by Weiss. The bankruptcy estate is in the process of selling the other half to a non-party. Weiss lost the bidding for the half of the fee that he does not already own and is a disappointed would-be sole owner. Outside of the bankruptcy, Weiss also has been unsuccessful in related efforts to purchase from AYH’s bondholders the note and mortgage securing the Hotel’s financing obligations, which are in default. 6. The operating entities, by contrast, have always been owned equally by Weiss and Goldman individually. Thus, the entities that represent the Hotel venture business are not part of the bankruptcy proceeding. It is the operating company interests that are the subject of this petition. The operating interests are owned by the individual Parties equally and connect to the fee ownership interests through a ground lease.”