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LAW OFFICES OF
VICTOR A. WORMS
65 BROADWAY, SUITE 750
NEW YORK, NY 10005
TELEPHONE: (212) 374-9590
FACSIMILE: (212) 591-6188
WRITERS EMAIL
VWORMS@VICTORAWORMSPC.COM
September 6, 2022
VIA NYSCEF
Honorable Paul I. Marx
Supreme Court of the State of New York
County of Rockland
1 South Main Street
New City, New York 10956
Re: Hello Living Developer Nostrand, LLC et al. v. 1580 Nostrand Mezz LLC et al.
Index No. 034885/2021
Dear Justice Marx:
As you know, I am counsel to Hello Living Developer Nostrand LLC (“Developer”) and
Hello Nostrand LLC (“Nostrand”) in the above-referenced action. I respectfully submit this letter
pursuant to the Court Notice entered on July 6, 2022 (NYSCEF No. 116), to update the Court on
the status of Developer’s bankruptcy case and recent developments, which we believe require the
Court’s intervention.
Developer’s bankruptcy case was dismissed on July 25, 2022, on the motion of Nostrand
Mezz Lender LLC (“Nostrand Mezz”). Nostrand Mezz, an affiliate of the Arch Companies
(“Arch”) , purportedly purchased the mezzanine loan at issue in this action from defendant 1580
Nostrand Mezz LLC (“1580 Nostrand”) in or around March 2022. Nostrand Senior Lender LLC,
another Arch Companies affiliate, acquired Nostrand’s mortgage loans for the underlying
property at the same time and recently commenced a foreclosure action in the Supreme Court
State of New York, County of Kings, under Index No. 524162/2022.
It is recently come to my attention that Nostrand Mezz has scheduled a UCC sale for
Developer’s membership interests in Nostrand with a broker named Rosewood Realty Group. The
sale is scheduled for September 21, 2022, at 2 p.m., with a bid deadline of September 19, 2022, at
4 p.m. Neither Developer nor I have received any notice of the sale, as required by the Court’s
order entered on October 25, 2021 (NYSCEF No. 58). Based on my initial research, it also does
not appear that the sale complies with the requirements set forth in the Court’s order. Among
other things, the sale does not appear to have been advertised in accordance with the requirements
of the October 25, 2021, order. Further, as Arch is simultaneously seeking a foreclosure against
Nostrand at the same time it is seeking a UCC sale of Developer’s interest in Nostrand, and is
seeking injunctive relief (Kings County Index No. 52416/2022, NYSCEF No. 80), the sale does
not appear to be commercially reasonable, but rather an attempt to prevent my clients from
exercising their right to redeem.
On August 25, 2022, I sent a letter to counsel of record for 1580 Nostrand requesting
copies of the notice of sale, bidding procedures, sale terms, and other information concerning the
scheduled UCC sale, including compliance with the notice and advertising requirements ordered
by the Court (Exhibit A). Counsel for 1580 Nostrand responded on August 26, 2022, stating “our
client sold the loan to a third party” and did not provide the requested information (Exhibit B).
On August 30, 2022, separate counsel representing Developer and Nostrand sent a letter to
counsel for Arch requesting the same information that I requested from counsel for 1580 Nostrand
(Exhibit C). Counsel for Arch has not responded to that letter.
On September 6, 2022, Greg Corbin sent what purports to be a notice of sale, in word
format. There is no date on the notice or indication that it was sent to either me or Developer 60
days in advance of the sale as Your Honor’s order requires. In addition, there is no indication that
the notice of sale was published in the New York Times and the Real Deal as explicitly required
by Your Honor’s order.
I have serious concerns about the propriety of the scheduled UCC sale, for which no
timely notice has been received by my clients or by me. Indeed, the refusal to provide the notice
of sale, bidding procedures, and sale terms appears to be intended to deprive my clients of the
opportunity to timely assess and competently challenge whether the scheduled UCC sale complies
with the terms of this Courts order and the UCC’s commercial reasonableness requirements.
We respectfully request that the Court schedule an emergency MS Teams conference to
discuss these issues and to set an expedited briefing schedule for my clients’ intended motion to
stay the scheduled UCC sale for failure to comply with the Court’s order.
Thank you for your attention to this matter.
Sincerely,
Victor A. Worms
cc: All Counsel of Record (via NYSCEF)
Paul H. Aloe, Esq. (via email)
Gayle Pollack, Esq. (via email)
Alan J. Brody, Esq.
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LAW OFFICES OF VICTOR A. WORMS 65 BROADWAY, SUITE 750 NEW YORK, NY 10005 TELEPHONE: (212) 374-9590 FACSIMILE: (212) 591-6188 WRITERS EMAIL VWORMS@VICTORAWORMSPC.COM September 6, 2022 VIA NYSCEF Honorable Paul I. Marx Supreme Court of the State of New York County of Rockland 1 South Main Street New City, New York 10956 Re: Hello Living Developer Nostrand, LLC et al. v. 1580 Nostrand Mezz LLC et al. Index No. 034885/2021 Dear Justice Marx: As you know, I am counsel to Hello Living Developer Nostrand LLC (“Developer”) and Hello Nostrand LLC (“Nostrand”) in the above-referenced action. I respectfully submit this letter pursuant to the Court Notice entered on July 6, 2022 (NYSCEF No. 116), to update the Court on the status of Developer’s bankruptcy case and recent developments, which we believe require the Court’s intervention. Developer’s bankruptcy case was dismissed on July 25, 2022, on the motion of Nostrand Mezz Lender LLC (“Nostrand Mezz”). Nostrand Mezz, an affiliate of the Arch Companies (“Arch”) , purportedly purchased the mezzanine loan at issue in this action from defendant 1580 Nostrand Mezz LLC (“1580 Nostrand”) in or around March 2022. Nostrand Senior Lender LLC, another Arch Companies affiliate, acquired Nostrand’s mortgage loans for the underlying property at the same time and recently commenced a foreclosure action in the Supreme Court State of New York, County of Kings, under Index No. 524162/2022. It is recently come to my attention that Nostrand Mezz has scheduled a UCC sale for Developer’s membership interests in Nostrand with a broker named Rosewood Realty Group. The sale is scheduled for September 21, 2022, at 2 p.m., with a bid deadline of September 19, 2022, at 4 p.m. Neither Developer nor I have received any notice of the sale, as required by the Court’s order entered on October 25, 2021 (NYSCEF No. 58). Based on my initial research, it also does not appear that the sale complies with the requirements set forth in the Court’s order. Among other things, the sale does not appear to have been advertised in accordance with the requirements of the October 25, 2021, order. Further, as Arch is simultaneously seeking a foreclosure against Nostrand at the same time it is seeking a UCC sale of Developer’s interest in Nostrand, and is seeking injunctive relief (Kings County Index No. 52416/2022, NYSCEF No. 80), the sale does not appear to be commercially reasonable, but rather an attempt to prevent my clients from exercising their right to redeem. On August 25, 2022, I sent a letter to counsel of record for 1580 Nostrand requesting copies of the notice of sale, bidding procedures, sale terms, and other information concerning the scheduled UCC sale, including compliance with the notice and advertising requirements ordered by the Court (Exhibit A). Counsel for 1580 Nostrand responded on August 26, 2022, stating “our client sold the loan to a third party” and did not provide the requested information (Exhibit B). On August 30, 2022, separate counsel representing Developer and Nostrand sent a letter to counsel for Arch requesting the same information that I requested from counsel for 1580 Nostrand (Exhibit C). Counsel for Arch has not responded to that letter. On September 6, 2022, Greg Corbin sent what purports to be a notice of sale, in word format. There is no date on the notice or indication that it was sent to either me or Developer 60 days in advance of the sale as Your Honor’s order requires. In addition, there is no indication that the notice of sale was published in the New York Times and the Real Deal as explicitly required by Your Honor’s order. I have serious concerns about the propriety of the scheduled UCC sale, for which no timely notice has been received by my clients or by me. Indeed, the refusal to provide the notice of sale, bidding procedures, and sale terms appears to be intended to deprive my clients of the opportunity to timely assess and competently challenge whether the scheduled UCC sale complies with the terms of this Courts order and the UCC’s commercial reasonableness requirements. We respectfully request that the Court schedule an emergency MS Teams conference to discuss these issues and to set an expedited briefing schedule for my clients’ intended motion to stay the scheduled UCC sale for failure to comply with the Court’s order. Thank you for your attention to this matter. Sincerely, Victor A. Worms cc: All Counsel of Record (via NYSCEF) Paul H. Aloe, Esq. (via email) Gayle Pollack, Esq. (via email) Alan J. Brody, Esq. 2