Opinion
450018/2019
04-29-2020
The CITY OF NEW YORK, Plaintiff, v. TORKIAN GROUP LLC, et al., Defendants.
Hsaio-Hsaing (Catherine) Wan, Esq., Deputy Director, Pierre Rivera, Esq., Special Assistant Corporation Counsel, The Mayor's Office of Special Enforcement, 22 Reade Street, 4th Floor, New York, NY 10007, 646-576-3480, Attorneys for Plaintiff City of New York Attorneys for Plaintiff, Kent L. Gubrud, Esq., Law Office of Kent Gubrud PC, 42 Broadway, Suite 12-125, New York, NY 10004 Attorneys for Defendants David Tordjman, Yohan Atlan, and NYAT LLC a/k/a NYATLEASE a/k/a Bedrose
Hsaio-Hsaing (Catherine) Wan, Esq., Deputy Director, Pierre Rivera, Esq., Special Assistant Corporation Counsel, The Mayor's Office of Special Enforcement, 22 Reade Street, 4th Floor, New York, NY 10007, 646-576-3480, Attorneys for Plaintiff City of New York
Attorneys for Plaintiff, Kent L. Gubrud, Esq., Law Office of Kent Gubrud PC, 42 Broadway, Suite 12-125, New York, NY 10004
Attorneys for Defendants David Tordjman, Yohan Atlan, and NYAT LLC a/k/a NYATLEASE a/k/a Bedrose
James E. d'Auguste, J.
In this nuisance abatement proceeding, defendants David Tordjman ("Tordjman"), Yohan Atlan ("Atlan"), and NYAT LLC a/k/a NYATLEASE a/k/a Bedrose ("Bedrose") (collectively, "Operator Defendants") move, pursuant to CPLR 3024, for an order striking all references to the convictions and proceedings related to the Office of Administrative Trials and Hearings ("OATH") or the Environmental Control Board ("ECB") of the City of New York on the grounds that said references are unduly prejudicial. Plaintiff the City of New York ("City") opposes the motion on the grounds that the references at issue are not prejudicial and have no bearing on the subject matter of the litigation; the decisions by ECB, which subsumes OATH, are constitutional and lawful, not arbitrary and capricious; and the Operator Defendants fail to establish how they are prejudiced by said references. For the reasons stated herein, the Operator Defendants' motion to strike is denied.
This Court notes that while the instant motion is lacking a "WHEREFORE" clause formally requesting the specific relief sought, however, this Court will address the relief demanded as it is set forth in the accompanying notice of motion. See Arriaga v. Michael Laub Co. , 233 AD2d 244, 245 (1st Dep't 1996).
Factual and Procedural Background
The facts, as relevant herein, are the following: The City filed the instant proceeding after approximately three years of unsuccessful administrative enforcement efforts, beginning in February 2015, to stop defendants from allegedly illegally advertising and renting units in three Class "A" multiple dwelling buildings located in Manhattan—110 Greenwich Street, 311 West 50th Street, and 488 7th Avenue (the "Subject Buildings")—for transient occupancy of less than thirty (30) days in violation of various sections of the New York Multiple Dwelling Law ("MDL"), the Administrative Code of the City of New York ("Administrative Code"), the New York City Building Code ("Building Code’), the New York City Fire Code, and the New York City Consumer Protection Law ("Consumer Protection Law"). A temporary restraining order enjoining all defendants from participating in these activities was issued on January 10, 2019. NYSCEF Doc. No. 82.
On June 6, 2019, this Court "So-Ordered" a Stipulation of Settlement and Consent Judgment by and between the City and the Owner Defendants granting the City, inter alia , permanent injunctive relief and monetary relief in the amount of $300,000. NYSCEF Doc. No. 155. On April 27, 2020, this Court issued a decision granting the City a preliminary injunction against the Operator Defendants, enjoining them from advertising or renting the units in the Subject Buildings for a period of less than thirty (30) days. NYSCEF Doc. No. 169. This decision also denied the Operator Defendants' cross-motion to dismiss wherein they claimed that they were either not personally liable, with respect to defendants Tordjman and Atlan, or that they were not liable because defendant Bedrose surrendered all possession of the units in the Subject Buildings. Id. The Operator Defendants now move to strike the Verified Complaint as prejudicial on the grounds that "the City's complaint fails to identify and distinguish the actual parties (Respondents) within such ECB[ ] proceedings, misrepresenting the facts in the process." NYSCEF Doc. No. 116, at 2.
The Owner Defendants are all other named defendants, as defined in this Court's decision in Motion Sequence No. 001 (NYSCEF Doc. No. 169), which contains a fuller recitation of the facts.
Discussion
CPLR 3024(b) states that "[a] party may move to strike any scandalous or prejudicial matter unnecessarily inserted in a pleading." "Motions to strike [allegations of a pleading] are not favored and are granted only when it is evident that, if denied, the moving party will be prejudiced, and denied unless it is plain that the adverse party will not be harmed." Baruch v. Young , 149 A.D. 466, 469 (1st Dep't 1912). "A motion to strike scandalous or prejudicial material from a pleading will be denied if the allegations are relevant to a cause of action." New York City Health & Hosps. Corp. v. St. Barnabas Cmty. Health Plan , 22 AD3d 391, at *1 (1st Dep't 2005) (citation omitted); see also Rice v. St. Luke's-Roosevelt Hosp. Ctr. , 293 AD2d 258, 259 (1st Dep't 2002).
In support of their motion, the Operator Defendants raise several arguments that broadly challenge the validity of the complaint, the provisions at issue, and the City's authority to inspect buildings and enforce punishments for violations of these provisions. The Operator Defendants' arguments can be summarized in two broad categories: (1) that the material from the ECB proceedings contained in the Verified Complaint are prejudicial to the Operator Defendants and have no bearing in the underlying nuisance abatement action; and (2) that the ECB has failed to comply with due process requirements of the United States and New York State Constitutions and its decisions are thereby unlawful, arbitrary, and capricious.
As an initial matter, the material from the ECB proceedings is not prejudicial to the Operator Defendants as they are relevant to the seven (7) causes of action contained in the Verified Complaint in this nuisance abatement proceeding for, inter alia , illegal transient use of units in the Subject Buildings for stays of less than thirty (30) days in violation of the MDL and the Administrative Code, illegal use or conversion of units in the Subject Buildings for the aforementioned use contrary to their Certificate of Occupancy in violation of the Administrative Code and Building Code, and deceptive trade practices in violation of the Consumer Protection Law. OATH and the ECB are responsible for enforcing the City's Building Code, which involves issuing violations, such as Notices of Violations ("NOVs"), or summonses when the Building Code is not complied with. The cited individual or entity can then correct the conditions on the violation and file a Certificate of Correction with the New York City Department of Buildings ("DOB") or can attend a hearing at OATH to contest the violation. With respect to the City's administrative enforcement efforts to combat short term illegal tenancies in the Subject Buildings, the City, through the New York City Mayor's Office of Special Enforcement ("OSE"), sends DOB inspectors to the buildings where it receives complaints of such activity. Upon inspection, if such activity is taking place, the DOB inspector will issue a(n) NOV(s). While Operator Defendants appear to take issue with the various NOVs, DOB complaints, and OATH/ECB decisions referenced in the Verified Complaint, the Operator Defendants did not challenge the NOVs at the time of their issuance and Certificates of Correction were filed acknowledging the violations and asserting, apparently erroneously, that the violations had been corrected. It is apparent from the Verified Complaint, exhibits annexed thereto, and the extensive record set forth by the City in its motion for a preliminary injunction in Motion Sequence No. 001, that the allegations in the Verified Complaint relating to the ECB proceedings are relevant to all seven (7) causes of action and cannot be stricken from that pleading.
While the Operator Defendants claim that the allegations relating to the ECB proceedings are prejudicial, the approximately 50-page motion does not specify how exactly the Operator Defendants are prejudiced. It can be gleaned from the papers that one potential argument as to why the Operator Defendants are prejudiced by these allegations is that the purportedly unconstitutional ECB decisions have collaterally estopped them from appealing the ECB's findings, however, this simply is not true. In this instance, where the Operator Defendants "assert[ ] that the determination of a governmental body [such as the ECB] is ‘in violation of lawful procedure, was affected by an error of law or was arbitrary and capricious or an abuse of discretion’ and seek[ ] nullification of same, then an article 78 proceeding is the appropriate vehicle through which the claim may be addressed." Abiele Contracting, Inc. v. New York City Sch. Constr. Auth. , 91 NY2d 1, 8 (1997) (quoting CPLR 7803 ). As such, the Operator Defendants are not collaterally estopped from raising the same issued that were raised before the ECB in an action before this Court via an Article 78 proceeding. As an aside, it is almost ironic that the Operator Defendants raise the issue of collateral estoppel at all since the instant motion is essentially the Operator Defendants' second bite at their prior cross-motion to dismiss the complaint in this action, only now couched as a motion to strike and, to that end, the Operator Defendants, themselves, should be collaterally estopped to the extent they make the same arguments regarding individual liability. Nonetheless, the mere fact that the ECB proceedings existed and are included as allegations in the Verified Complaint do not prejudice the Operator Defendants and is not a reason to strike the Verified Complaint in its entirety or any allegations contained therein as prejudicial.
Next, the Operator Defendants argue, in a multitude of different phrasing, that the ECB ignores the Federal and State Constitutions or is unconstitutional because it ignores, inter alia , the due process provision of these documents, which is prejudicial to the Operator Defendants. For example, the Operator Defendants argue that ECB cases are "prosecuted in violation of due process" (NYSCEF Doc. No. 116, at 15) and that the evidence obtained by DOB inspectors is inadmissible in those proceedings because they are granted unconstitutional search and seizure powers; that the ECB determinations regarding the Operator Defendants' statutory violations should be disregarded because the ECB is only "slightly more fair than the Spanish inquisition" (NYSCEF Doc. No. 112, at 11); and that OSE, a governmental task force established to address quality of life issues citywide, which was created without proper authority and in violation of the New York City Charter, regularly violates the search and seizure and due process provisions of the State Constitution. The Operator Defendants make all these arguments, based principally on hyperbole as in The City of New York v. Baldeo , 2019 WL 993135, 2019 NY Slip Op. 30485(U) (Sup. Ct. NY County Mar. 1, 2019), without specifying a single example of unconstitutional practices by the ECB, specifically, any instance where the ECB failed to accord for due process or an instance where a fire inspector or DOB inspector violated search and seizure rights. Instead, the New York City Charter, at Section 1046(c), provides the rights that parties are entitled to during a hearing and that section specifically states that "the parties shall be afforded due process of law" and then details a list of particular rights. Moreover, "[i]t is well settled that the principles of due process applicable to criminal trials apply to government administrative proceedings." Wolfe v. Kelly , 79 AD3d 406, 409 (1st Dep't 2010). Accordingly, this Court finds that the Operator Defendants' arguments regarding the alleged unconstitutionality of the ECB are baseless.
With respect to any illegal search and seizure arguments made in the instant motion, the Operator Defendants provide no evidence that the transient tenants could not, or did not, consent to a search. See United States v. Buettner-Janusch , 646 F.2d 759, 765 (2d Cir. 1981) ("[C]onsent to a search by one with access to the area searched, and either common authority over it, a substantial interest in it or permission to exercise that access, express or implied, alone validates the search."). Additionally, the DOB investigators were permitted to enter the Subject Buildings and look around without such actions constituting a search: New York courts have held that general access to common areas like hallways and lobbies negate expectations of privacy required to give rise to Fourth Amendment concerns. See People v. Espinal , 161 AD3d 556 (1st Dep't 2018).
This Court has reviewed the Operator Defendants' remaining arguments and find them to be without merit.
Conclusion
Accordingly, the Operator Defendants' motion to strike is denied. This constitutes the decision and order of this Court.