Three months before the trial, a New York law firm represented a guarantor being sued for $8 million. The case was linked to the largest mixed-use real estate development project in the world. The lawyer who hired us said that “the case was an unmitigated disaster and that they needed us to mitigate it.” Another firm had already lost a similar case, but a procedural technicality permitted the second case to proceed as if it were the first.
We offered $3.5 million to settle, but because of our predecessor firm’s prior loss, opposing refused our offer. We went to trial arguing that the bank was guilty of bad faith for refusing to approve leases and improperly declaring a default. The bank offered evidence of more than $1 million in attorney fees incurred. After cross-examination, however, the judge struck this evidence.
One of the interesting features of the case was the use of models of the project. The jury paid rapt attention as our client explained each feature of the project. There were three sets of residential condominiums, one section of office condominiums, another section of residential condominiums, and two parking garages. Another unique feature was the evidence of syndications. When the retail sales of condominiums slowed, syndicators were willing to buy the condominiums in bulk. But the bank improperly denied these sales even though its financial position would have improved had they been approved.
One additional lesson learned from this case: loan officers are friendly, cooperative, and knowledgeable, whereas bank workout groups are often more difficult to work with. Egos got in the way here. Sometimes you should explore creative solutions- a win win plan-before shutting down a project.
To learn about similar services we offer visit our litigation practice areas page. Patterson Law Firm takes a variety of cases. If you have a case similar to the one above or in one of our other practice areas, contact us at (312) 223-1699.