Wilk Auslander Obtains $7 million Summary Judgment On Alter Ego/Veil Piercing and Fraudulent Conveyances Claims

On April 25, 2023, Justice Arlene Bluth of New York Supreme Court issued a decision granting the motion for summary judgment that Wilk Auslander filed on behalf of our clients, 3 Manhattan landlords, against Icon Parking LLC and its separate garage tenant LLCs in the lawsuit captioned RPH Hotels 51^st Street Owner, LLC et al v. Icon Parking Holdings, LLC et al (654030/2021).

We had previously obtained judgments for our landlord-clients against the respective garage tenant entities for their failure to pay rent during the Covid crisis, during which they remained fully open for business and collected substantial parking revenue. However, the plaintiff-landlords were unable to collect on their judgments, as all of those entities’ assets had been funneled up to their parent company, Icon. These fraudulent conveyances left the tenant garages essentially judgment-proof. After learning of the transfer of assets, we commenced a new action against Icon, requesting that the Court pierce the corporate veil and allow our clients to collect their judgments from the parent company who had received the funds.

While courts are often hesitant to allow the piercing of the corporate veil, particularly on motions for summary judgment, we were successful. We were able to obtain a full judgment against Icon as the alter ego of the garage tenant entities in excess of $7 million dollars, in addition to having the transfers between the tenant garage entities voided as fraudulent pursuant to New York Debtor Creditor Law § § 273, 274. The Court’s decision adopts many of the arguments that we raised in our summary judgment motion. Wilk Auslander’s team was led by Alan Zuckerbrod, Arielle Wasserman and Michael Contos. A copy of the Court’s decision and order can be found here.