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1 SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK : CIVIL TERM : PART 3
2 ------------------------------------------X
YASEMIN TEKINER,
3 In her individual capacity, as a beneficiary and a trustee of
The Yasemin Tekiner 2011 Descendants Trust and derivatively as
4 a holder of equitable interests in a shareholder or a member of
the Company Defendants,
5
Plaintiff,
6 INDEX NO:
-against- 657193/2020
7
BREMEN HOUSE INC., BREMEN HOUSE TEXAS, INC., GERMAN NEWS COMPANY,
8 INC., GERMAN NEWS TEXAS, INC., 254-258 W. 35TH ST. LLC, BERRIN
TEKINER, GONCA CHELSEA, and BILLUR AKIPEK, in her capacity as a
9 Trustee of The Yasemin Tekiner 2011 Descendants Trust,
10 Defendants.
------------------------------------------X
11 New York Supreme Courthouse
60 Centre Street
12 New York, New York 10007
April 13, 2022
13 B E F O R E:
14 THE HONORABLE JOEL COHEN,
J U S T I C E
15 A P P E A R A N C E S:
16 FOLEY HOAG, LLP
Attorney for the Plaintiff
17 1301 Avenue of the Americas, Floor 25
New York, New York 10019
18 BY: STEPHEN YOUNGER, ESQ.
19
PARKER IBRAHIM & BERG
20 Attorney for the Plaintiffs
BY: SANJAY IBRAHIM, ESQ.
21 SCOTT PARKER, ESQ.
22 NORTON ROSS FULBRIGHT
Attorney for the Defendants
23 1301 Avenue of the Americas
New York, New York 10019
24 BY: JUDITH ARCHER, ESQ.
SEAN TOPPING, ESQ.
25 Karen Mangano, CSR
Senior Court Reporter
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1 THE COURT: Let's start with a appearances.
2 Good morning everyone. Beginning with the
3 Plaintiff.
4 MR. YOUNGER: Stephen Younger for the Plaintiff.
5 THE COURT: Anyone else for the Plaintiff?
6 MR. PARKER: Scott Parker also on behalf of the
7 Plaintiff with my partner Sanjay Ibrahim.
8 THE COURT: Good morning. And for the Defense.
9 MS. ARCHER: Judith Archer along with my colleague
10 Sean Topping.
11 THE COURT: Just for those in court, we are going
12 to have to use the microphones, and when we are doing the
13 argument, if we can do it from the lectern, that would be
14 good.
15 I have noticed that -- our scheduling, we do our
16 scheduling as motions come in, and we have you all on the
17 calendar for a couple of different hearings over the next
18 couple of weeks, I believe.
19 Do we have -- we have the motion today and then we
20 have one next week. And then do we have another one the
21 week after that?
22 MR. YOUNGER: I think the others are just for
23 sealing, and we were told by your Honor's law clerk that it
24 wasn't necessary to make an appearance.
25 THE COURT: Sealing motions, very unlikely we would
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1 have an appearance.
2 MS. ARCHER: There are two.
3 MR. YOUNGER: Just two hearings today and then --
4 MS. ARCHER: There is a hearing on Monday, but it
5 involves two motions, your Honor.
6 THE COURT: Okay. So it has been consolidated.
7 MS. ARCHER: That is my understanding, yes.
8 THE COURT: All right. Good.
9 We are having trouble hearing you. Maybe because
10 that's not loud enough or close enough to you.
11 Is the green button on?
12 MS. ARCHER: Now it is. I was just about to ask
13 you if you could hear me through the mask.
14 THE COURT: Now I can. All right.
15 So this is a motion for leave to renew the
16 preliminary injunction motion in reconsideration of an
17 earlier order. So I think first up it would be the
18 Plaintiff's then in support.
19 MR. YOUNGER: Thank you, your Honor. Thank you for
20 hearing us this morning.
21 I'd like to start just by emphasizing how
22 dramatically the posture of this case has changed just in
23 the last six weeks, and this is since the time that my
24 client Yasemin filed her initial injunction motion.
25 Most significantly, this is no longer a minority
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1 shareholder case. With Yasemin's sister, it's now a
2 majority shareholder case. So what does this mean?
3 Two-thirds equitable shareholders believe that the
4 minority shareholders are not fit to run this company and
5 two-third equitable shareholders believe that Yasemin was
6 wrongly fired and ought to continue as a director or officer
7 of these companies today. This is a fundamental shift in
8 the nature of this case, and we hope, your Honor, will
9 consider that.
10 It wasn't until we were able to dig into the
11 evidence through discovery that we learned facts that
12 Defendants knew all along. These facts concern Yasemin's
13 improper firing but also the actions of her trustee
14 Defendant Billur. We believe that had those facts been
15 disclosed a year ago that the pendulum would have shifted
16 the other way and warranted an injunction so Yasemin will
17 still have a right to a say in business in which her trust
18 was one-third.
19 THE COURT: Well, the issue a year ago was before
20 the firing took place.
21 MR. YOUNGER: That's correct, but a motion to renew
22 speaks as of that date and much of it is based on facts that
23 were -- that the Defendants knew but we didn't know and only
24 learned of in discovery.
25 So at that time, your Honor observed that if our
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1 description of the facts turned out to be correct, Yasemin
2 would prevail. We believe this evidence has come to light
3 through discovery. Your Honor also noted that defense
4 counsel's representations that Yasemin's firing was proper
5 and what they called a proper act -- I'm sorry --
6 responsible act of corporate governance. We believe
7 discovery showed that this firing is anything but
8 responsible governance.
9 As well, your Honor expressed skepticism about the
10 conflicted roles that Yasemin's trustee Billur played given
11 her duty to protect Yasemin and a duty of undivided loyalty
12 yet her acting, you know, in concert with the other
13 Defendants in the firing.
14 Since then Billur didn't just go along with that
15 firing, she was an active participant in it and for
16 self-serving reasons that didn't protect Yasemin's
17 interests.
18 So since the injunction ruling, our concern is that
19 the Defendants have continued their abuse of the company at
20 great speed to advance their own personal interests. They
21 put on the market or sold six company properties worth
22 millions of dollars including a 35th Street property which
23 is right near Hudson Square and valued at -- Hudson Yards
24 valued at over $35 million.
25 This is a company that Billur described as one
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1 where buying and selling is not very frequently done and
2 this is the problem we have had. Our client is no longer in
3 management.
4 Let me talk about that 35th Street property for a
5 minute. It is the crown jewel of this business. It's
6 managed by Bremen House and Yasemin's trust holds a
7 substantial interest in it. We wrote a letter earlier this
8 year complaining about that sale and immediately, literally
9 the next day the broker said despite this dispute -- he
10 called it a dispute -- the family is defiantly selling the
11 property. And more troubling, he said that they had a
12 whisper price that he was pushing of just $50 million, a
13 property that they had gotten a $75 million appraisal for,
14 and these are the sorts of decisions that are harmful to the
15 company from which Yasemin is being excluded.
16 So let me talk about the three factual bases that
17 support this motion. First is the cooperation of Yasemin's
18 sister Zeynep. She's a Bremen House director and officer.
19 She testified at her deposition that the week before the TRO
20 hearing in this case, she opposed Yasemin's firing. She
21 also testified that as was her mother's history of
22 retaliation, her mother pressured her, threatened to fire
23 her Zeynep too if she didn't go along with this firing.
24 It is remarkable that Zeynep -- that defense
25 counsel Norton Rose was on the phone for at least part of
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1 these events, yet didn't disclose it to the Court. Instead,
2 told this Court it was a responsible act of corporate
3 governance. We think that it was anything but.
4 The second key fact is what was their motive. It
5 is virtually admitted through discovery that the only motive
6 for firing Yasemin was to take away funds so she couldn't
7 bring this lawsuit. And as Zeynep testified, her mother
8 believed that if she fired her, she wouldn't even be able to
9 bring this lawsuit. That's what she testified to at her
10 deposition, and as we'll get into a moment, that is not a
11 proper basis.
12 The third foot of the stool is Billur's active
13 involvement. Now, what has unfolded during discovery is
14 that Billur just didn't consent. She was at the table with
15 Yasemin's mother pressuring Zeynep to consent. According to
16 Zeynep, Billur was acting very aggressive. She said that
17 she shouldn't give Yasemin the funds to pursue this case.
18 Her words were -- this is Billur, Yasemin's a trustee. "You
19 can't give someone a loaded gun to use against you." That
20 has nothing to do with protecting Yasemin's interests of the
21 trustee.
22 So let me turn to why these facts support a
23 likelihood of success on fiduciary duty. First as to the
24 pressuring. What was not disclosed to Zeynep was they
25 needed her consent.
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1 Section 3.8 of the Bylaws say you need unanimous
2 written consent to fire Yasemin. And instead, they led her
3 to believe let's all go along. They literally misled her,
4 and they did so for a motive that wasn't proper. It was
5 simply to discourage somebody from pursuing a lawsuit that
6 would expose a wrongdoing.
7 Now critically, what we get from the Defendants are
8 just conclusory denials, but I think most important, there
9 is no affidavit from Billur. She was there. There's no
10 affidavit denying any of this. So I think you have to
11 really credit these sworn statements.
12 Now, Defendants in their brief argue well, they
13 could fire Yasemin for any reason citing employment cases.
14 This isn't an employment case. This is a fiduciary duty
15 case, and the question is did they have any proper business
16 reason to fire Yasemin, and now, you know, that their sole
17 reason was to protect themselves to keep Yasemin from suing
18 them and really a classic breach of fiduciary duty.
19 Now you'll hear some post hoc justifications,
20 things like the Chick-fil-A store, which all have been
21 rebutted in the affidavit, but I think the more important
22 thing is the only reason Zeynep was told for firing Yasemin
23 was to discourage her from bringing this suit.
24 So let me turn then to Billur's fiduciary duty
25 brief. As this Court has previously acknowledged, she had a
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1 sworn duty of undivided loyalty to Yasemin. And as the
2 proof has shown, she was an active participant in firing
3 Yasemin. And so her disregard for Yasemin's interests is a
4 classic fiduciary duty breach. She was acting to protect
5 herself. She literally said that when Yasemin asked her for
6 distributions, the only reason she disregarded it was
7 because Yasemin was suing them. She's her trustee. She has
8 to look out for Yasemin's interests, not her own interests
9 in weighing a lawsuit.
10 Discovery has also shown that Billur has benefited
11 for a huge amount of this scheme. She gets a $250 per month
12 sweetheart lease on an apartment. She has a caretaker,
13 driver services, lavish vacations, cruises, and I think most
14 importantly, a bonus that was designed to get her
15 cooperation with the Extell sale. And in the absence of a
16 Billur affidavit, none of this is denied.
17 So let me talk turn to an issue which your Honor
18 focused on at the prior hearing which is irreparable harm.
19 We believe the cases -- there are many that we cited in our
20 brief -- support the notion that the exclusion from
21 management is a classic irreparable harm.
22 For example, in the Post Broadway case, the
23 commercial division considered a real estate management
24 company very much like this, and the Court said that losing
25 management control over properties could result in
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1 irreparable harm because the company could be bound to
2 undesirable arrangements, low rental rates --
3 THE COURT: But she never -- she never had
4 management control; right? She was an employee.
5 MR. YOUNGER: She was a director of both companies,
6 and she was treasurer.
7 THE COURT: Right. I think most of those cases are
8 where somebody is, you know, being deprived of the right to
9 direct the operations.
10 You're saying that the right to be a director and
11 treasurer fits within those cases as well?
12 MR. YOUNGER: Exactly.
13 By the way, with Zeynep joining this case, and
14 you'll hear her motion next week, you have two-thirds of the
15 shareholders at the table, and clearly they want to fire
16 Zeynep as well. So what will happen is the minority, if
17 this injunction is not granted, will effectively take over
18 this company and have the ability to do whatever the heck
19 they want because there won't be any check on it.
20 The only other director is their lieutenant Billur.
21 So having a say in the company as a director is a critical
22 right of the shareholder. And now we have two-thirds of the
23 shareholders saying we want to make sure we have those
24 rights in this company. And by the way, it's not a
25 disruption of management. A Board of Directors is only
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1 going to really check these major decisions like selling off
2 35th Street at a bargain basement price. That role as a
3 director is a critical one, and I think not all of the cases
4 that we cite involve majority control, but actually we have
5 majority control. We have two-thirds of the shareholders at
6 the table now and a minority is trying to keep them out of
7 the company.
8 So there is another fact in addition to the 35th
9 Street fact which gives me a lot of pause, and that is that
10 Berrin told Zeynep at the start of this case that she was
11 going to sell properties and hide the assets from Yasemin,
12 and that's exactly what we're concerned about.
13 It's not just that they're selling properties. We
14 don't know where the money is going to. They have not even
15 produced an annual financial statement for the last year,
16 and Yasemin is being denied information.
17 When she asked for information about the 35th
18 Street sale, she was told to get lost. Literally, get lost
19 by the Defendants. We were only able to get these documents
20 by subpoenaing the broker, and so it's not just being
21 excluded from management. It's being excluded from
22 information.
23 There is a second ground for irreparable harm.
24 Yasemin can no longer a afford fertility treatment. She's a
25 42-year old woman. Every day that she's denied those
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1 fertility treatments which are not covered by insurance is a
2 day that she will not be able to have a child on her own.
3 The Defendants callously as they often do in their papers
4 make light of the situation. They refer to her nonexistent
5 future descendent. She deserves better than that, your
6 Honor, and the Court has the power to make sure that Yasemin
7 and her sister have a proper say in this company, and the
8 time is now to do that.
9 So let me talk about the final factor which is
10 balancing of the equities. As I said before, Yasemin and
11 Zeynep collectively hold two-thirds of this company. The
12 assets are supposed to go to three sisters. And yet, she's
13 treating this as this is her own sort of power grab as her
14 own company. And so we believe that far from undermining
15 governance as the Defendants would have, granting this
16 injunction would maintain the status quo as it existed on
17 the day your Honor first heard this summary judgment motion
18 over a year ago such that the two-thirds of the company will
19 be adequately represented. And with that, I appreciate you
20 taking the time, and I would ask you for the preliminary
21 injunction.
22 THE COURT: One thing I wanted to ask about, there
23 are some points made in your papers that shareholders of
24 this particular company as it's been run get their returns
25 through salaries for positions which they may or may not --
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1 well -- for salaries for positions as opposed to dividends
2 or other -- what is the distribution of profits to Yasemin,
3 for example, in the absence of a salary? I saw references
4 to pensions and the like, but I don't have a sense for what
5 is the cash flow to Yasemin in this business.
6 MR. YOUNGER: Your Honor, that's a critical
7 question. The pension has nothing to do with it. That was
8 money she set aside from her salary so she could take care
9 of herself when she retired. Sadly, she's drawing down now.
10 The distributions to Yasemin from this company are
11 zero. So she's a one-third owner of a company. She asked
12 her trustee once her salary was denied to make
13 distributions. Her trustee didn't even get back to her.
14 THE COURT: Make distributions from what?
15 MR. YOUNGER: From the company.
16 THE COURT: How can the -- how can -- in other
17 words, does the trust receive funds from the company?
18 MR. YOUNGER: The trust has not received funds, and
19 I believe this was based on Norton Rose's advice. And your
20 Honor's probably aware that there's more beneficial tax ways
21 to the company to base salaries than to pay distributions.
22 So historically, Ms. Billur's testimony at her
23 deposition is that the company pays salary, not
24 distributions. So the result of denying the injunction a
25 year ago and allow them to fire my client is she owns
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1 one-third of a multi-million dollar company and gets zero.
2 THE COURT: Again, so there are no dividends to the
3 trust as shareholders?
4 MR. YOUNGER: Correct. And she asked for it, and
5 that request was denied as I said simply because she was
6 suing the company.
7 So right now Yasemin doesn't even own stock. She
8 has no information, no say-so in management, and she has no
9 discretion whatsoever from a company for which her trust
10 owns one-third, and that's just not right.
11 And Page 1 of their brief, they say this company is
12 for the benefit of all the shareholders. My client is
13 getting no benefit. None.
14 THE COURT: All right. Thank you.
15 MR. YOUNGER: Thank you, your Honor.
16 MS. ARCHER: Thank you, your Honor.
17 I will address some of those points as I go. Happy
18 to answer that question if you'd like now or I can address
19 it later.
20 Ultimately, you know, as we sit here, 15 months ago
21 your Honor denied Yasemin a preliminary injunction and
22 temporary restraining order on the grounds that she had not
23 established the likelihood of success on the merits and had
24 not established irreparable harm because any harm that was
25 being alleged could be redressed with money damages.
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1 I think the case has not changed so drastically.
2 And in fact, the facts that have been put before your Honor
3 on this alleged motion to renew were largely before the
4 Court when you decided this to begin with; the issues with
5 respect to mismanagement of the company, the issues with
6 respect to the allegations that Billur B-I-L-L-U-R not
7 "Buller" have had a conflict. She has been deposed, and her
8 testimony is before the Court. And Mr. Younger has not
9 represented it accurately. But the motion to renew requires
10 that there being material facts that existed at the time but
11 that were unknown and that would have changed the result,
12 and we don't believe that standard has been met. We don't
13 believe that the Plaintiff has established anymore
14 likelihood of success based on blocking out a few documents
15 in a several hundred thousand document production or citing
16 to a couple of depositions when a number of depositions have
17 yet to take place including the broker and two of the
18 defendants who have not yet been deposed.
19 So we believe that, you know, this is -- this is an
20 effort to reinstate Yasemin in cooperation with her sister
21 Zeynep who has now switched sides and the --
22 THE COURT: Do you agree just on the math that the
23 two trusts that Zeynep and Yasemin would hold two-thirds of
24 the equity?
25 MS. ARCHER: I agree that the two trusts hold
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1 two-thirds of the equity, yes. I don't agree that that
2 changes anything. Ultimately, they're both employees of the
3 company. Zeynep has not been threatened with being fired.
4 We'll address that on Monday.
5 Yasemin was creating a situation that was so
6 problematic that led to her termination and ultimately was
7 likely secret recordings with employees and with accountants
8 and yelling at employees and taking positions that were
9 incredibly disruptive and dangerous to the way the company
10 was proceeding with respect to a large real estate sale and
11 with respect to turning exchange properties to be able to
12 create more income for the companies.
13 Yasemin hasn't asserted or established anymore of a
14 likelihood of success at this point given how much discovery
15 is still to be had and given how little they have actually
16 pointed to and I would say misrepresented drastically.
17 But also, there is still no irreparable harm. I
18 think your Honor correctly referred to the case law which is
19 very different than the situation here. This is not a
20 situation where the Plaintiff or any of the individuals have
21 a right to be employed forever.
22 In fact, Yasemin and Zeynep have done very little
23 for the company for a number of years.
24 THE COURT: Well, if you have a company where the
25 shareholders -- I mean, you can operate companies lots of
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1 different situation. Generally speaking, in a typical
2 company, shareholders would share in the profits of the
3 company through distributions or dividends or whatever. But
4 the assertions made here that -- and we'll get into this.
5 This company has got some issues, it seems to me, but one of
6 them is that in lieu of that normal kind of shareholder
7 relationship, people get their money through salaries and
8 perks and the like so that these shareholders at the whim of
9 as you said -- you know, people can be fired from employee
10 positions, but if that in the way this company works is
11 literally the only way shareholders have any upside in the
12 company, doesn't that change the scenario a bit?
13 MS. ARCHER: Well, your Honor, the -- the three
14 daughters are not shareholders directly. They are
15 beneficiaries of three trusts.
16 THE COURT: Well, they're trusts.
17 MS. ARCHER: Which are shareholders. Each of those
18 trusts holds a more than $10 million note payable to them.
19 This was all an estate planning that Berrin did not have to
20 do, but she put these monies in trust, and there are
21 separate trusts that are much smaller percentage ownerships
22 was respect to the 35th Street property which is not owned
23 by Bremen House and which is owned by a company that your
24 Honor dismissed from this case.
25 THE COURT: So just so I'm clear, so the trusts
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1 have 10 million in cash?
2 MS. ARCHER: No. The trusts owe $10 million because
3 that was the only way that the trust could and ultimately
4 the beneficiaries after Berrin's death which is what this
5 was supposed to be could avoid certain taxes.
6 THE COURT: Did they receive funds in exchange for
7 those notes?
8 MS. ARCHER: They received shares in the company.
9 THE COURT: Right. So all they have are illiquid
10 shares, no cash flow and a $10 million note --
11 MS. ARCHER: That's right.
12 THE COURT: -- that they have to pay back.
13 MS. ARCHER: And that's the way these were set up,
14 all with their knowledge and consent because they were
15 getting --
16 THE COURT: Well, at the time the way this business
17 seems to operate, and even your client seems to suggest that
18 she had this treasurer title which she didn't really do
19 anything, that just seems to be the way the compensation
20 model such as it is worked. And now taking, you know,
21 unilateral action to say, all right, we set it up this way,
22 the trusts aren't going to get any actual dividends when we
23 sell properties or whatever, but you'll make your money as
24 an employee and then you turn that off and now she's -- the
25 trust is not giving her anything. The company is not giving
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1 her anything except for, you know, the property she's living
2 in. It is kind of a rug being pulled out from under them;
3 isn't it?
4 MS. ARCHER: Well, your Honor, there wasn't a
5 situation where they sat down and were promised oh, don't
6 worry, you'll get a salary forever. This was -- I mean,
7 they were supposed to be working at the company and
8 participating. And unfortunately, Yasemin and Zeynep
9 decided to do other things. And so Berrin continued to
10 support them in many ways, not just salary, but from her
11 personal funds with vacations that she paid for, with help
12 on fertility treatments that she had been willing to do at
13 the time.
14 I don't think it can be argued that, you know,
15 she's probably not being unreasonable in not continuing to
16 do that given what her daughter said about her. But this
17 was not a situation where there was documented -- where
18 there were promises.
19 The Bylaws of the company allow the employees to be
20 terminated under a certain process. And so, Mr. Younger has
21 mentioned that that process requires a consent from all of
22 the shareholders. It actually -- there are alternatives.
23 And while that was the process used at this point and Zeynep
24 willingly signed two consents; although she now apparently
25 says that that didn't happen or that she had a gun to her
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1 head. That's not what she said in her deposition, by the
2 way.
3 THE COURT: What would stop these two
4 shareholders -- the two trusts if the beneficiaries couldn't
5 get the trustees to do it to insist on payment of dividends
6 or change the way the company works? Is there something in
7 the corporate documents that would permit the two-third
8 shareholders from -- through their representatives from
9 changing things?
10 MS. ARCHER: There are trust documents that lay out
11 what the obligations and the rights are of the beneficiaries
12 and the trustee, and the trustees are not required to make
13 distributions. And in this case, there wasn't anything to
14 distribute.
15 THE COURT: I'm not talking about that at that
16 level.
17 The trusts are the shareholders in Bremen House.
18 So why couldn't the two trustees for the two trusts -- I'm
19 not sure if they are the same person. But does the Zeynep
20 trust interest and the Yasemin trust, is the trustee the
21 same person?
22 MS. ARCHER: Yes.
23 THE COURT: So if counter to the facts that that
24 trustee decided for the benefit of the beneficiaries, would
25 they have the power, those two trusts together with their
KM
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21
Proceedings
1 two-thirds voting interest, is there anything in the
2 corporate documents that would prevent them from changing
3 the way the company works?
4 MS. ARCHER: I believe that that's not -- I mean,
5 the trusts are in place and the beneficiaries receive the
6 benefits after Berrin's death. So these are grantor trusts
7 that are not -- the expectation and the documents don't
8 anticipate that they would be able to if their trustee --
9 one or both of their trustees say we don't want to be
10 involved, we just want our money that they could then break
11 up the companies and distribute it to the trust.
12 THE COURT: Right. I'm trying to get at what the
13 corporate documents say. There are shareholders. And do
14 the shareholders not have the rights that shareholders
15 normally have?
16 MS. ARCHER: The shareholders have certain
Preview
FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 1 1 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK : CIVIL TERM : PART 3 2 ------------------------------------------X YASEMIN TEKINER, 3 In her individual capacity, as a beneficiary and a trustee of The Yasemin Tekiner 2011 Descendants Trust and derivatively as 4 a holder of equitable interests in a shareholder or a member of the Company Defendants, 5 Plaintiff, 6 INDEX NO: -against- 657193/2020 7 BREMEN HOUSE INC., BREMEN HOUSE TEXAS, INC., GERMAN NEWS COMPANY, 8 INC., GERMAN NEWS TEXAS, INC., 254-258 W. 35TH ST. LLC, BERRIN TEKINER, GONCA CHELSEA, and BILLUR AKIPEK, in her capacity as a 9 Trustee of The Yasemin Tekiner 2011 Descendants Trust, 10 Defendants. ------------------------------------------X 11 New York Supreme Courthouse 60 Centre Street 12 New York, New York 10007 April 13, 2022 13 B E F O R E: 14 THE HONORABLE JOEL COHEN, J U S T I C E 15 A P P E A R A N C E S: 16 FOLEY HOAG, LLP Attorney for the Plaintiff 17 1301 Avenue of the Americas, Floor 25 New York, New York 10019 18 BY: STEPHEN YOUNGER, ESQ. 19 PARKER IBRAHIM & BERG 20 Attorney for the Plaintiffs BY: SANJAY IBRAHIM, ESQ. 21 SCOTT PARKER, ESQ. 22 NORTON ROSS FULBRIGHT Attorney for the Defendants 23 1301 Avenue of the Americas New York, New York 10019 24 BY: JUDITH ARCHER, ESQ. SEAN TOPPING, ESQ. 25 Karen Mangano, CSR Senior Court Reporter KM 1 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 2 Proceedings 1 THE COURT: Let's start with a appearances. 2 Good morning everyone. Beginning with the 3 Plaintiff. 4 MR. YOUNGER: Stephen Younger for the Plaintiff. 5 THE COURT: Anyone else for the Plaintiff? 6 MR. PARKER: Scott Parker also on behalf of the 7 Plaintiff with my partner Sanjay Ibrahim. 8 THE COURT: Good morning. And for the Defense. 9 MS. ARCHER: Judith Archer along with my colleague 10 Sean Topping. 11 THE COURT: Just for those in court, we are going 12 to have to use the microphones, and when we are doing the 13 argument, if we can do it from the lectern, that would be 14 good. 15 I have noticed that -- our scheduling, we do our 16 scheduling as motions come in, and we have you all on the 17 calendar for a couple of different hearings over the next 18 couple of weeks, I believe. 19 Do we have -- we have the motion today and then we 20 have one next week. And then do we have another one the 21 week after that? 22 MR. YOUNGER: I think the others are just for 23 sealing, and we were told by your Honor's law clerk that it 24 wasn't necessary to make an appearance. 25 THE COURT: Sealing motions, very unlikely we would KM 2 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 3 Proceedings 1 have an appearance. 2 MS. ARCHER: There are two. 3 MR. YOUNGER: Just two hearings today and then -- 4 MS. ARCHER: There is a hearing on Monday, but it 5 involves two motions, your Honor. 6 THE COURT: Okay. So it has been consolidated. 7 MS. ARCHER: That is my understanding, yes. 8 THE COURT: All right. Good. 9 We are having trouble hearing you. Maybe because 10 that's not loud enough or close enough to you. 11 Is the green button on? 12 MS. ARCHER: Now it is. I was just about to ask 13 you if you could hear me through the mask. 14 THE COURT: Now I can. All right. 15 So this is a motion for leave to renew the 16 preliminary injunction motion in reconsideration of an 17 earlier order. So I think first up it would be the 18 Plaintiff's then in support. 19 MR. YOUNGER: Thank you, your Honor. Thank you for 20 hearing us this morning. 21 I'd like to start just by emphasizing how 22 dramatically the posture of this case has changed just in 23 the last six weeks, and this is since the time that my 24 client Yasemin filed her initial injunction motion. 25 Most significantly, this is no longer a minority KM 3 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 4 Proceedings 1 shareholder case. With Yasemin's sister, it's now a 2 majority shareholder case. So what does this mean? 3 Two-thirds equitable shareholders believe that the 4 minority shareholders are not fit to run this company and 5 two-third equitable shareholders believe that Yasemin was 6 wrongly fired and ought to continue as a director or officer 7 of these companies today. This is a fundamental shift in 8 the nature of this case, and we hope, your Honor, will 9 consider that. 10 It wasn't until we were able to dig into the 11 evidence through discovery that we learned facts that 12 Defendants knew all along. These facts concern Yasemin's 13 improper firing but also the actions of her trustee 14 Defendant Billur. We believe that had those facts been 15 disclosed a year ago that the pendulum would have shifted 16 the other way and warranted an injunction so Yasemin will 17 still have a right to a say in business in which her trust 18 was one-third. 19 THE COURT: Well, the issue a year ago was before 20 the firing took place. 21 MR. YOUNGER: That's correct, but a motion to renew 22 speaks as of that date and much of it is based on facts that 23 were -- that the Defendants knew but we didn't know and only 24 learned of in discovery. 25 So at that time, your Honor observed that if our KM 4 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 5 Proceedings 1 description of the facts turned out to be correct, Yasemin 2 would prevail. We believe this evidence has come to light 3 through discovery. Your Honor also noted that defense 4 counsel's representations that Yasemin's firing was proper 5 and what they called a proper act -- I'm sorry -- 6 responsible act of corporate governance. We believe 7 discovery showed that this firing is anything but 8 responsible governance. 9 As well, your Honor expressed skepticism about the 10 conflicted roles that Yasemin's trustee Billur played given 11 her duty to protect Yasemin and a duty of undivided loyalty 12 yet her acting, you know, in concert with the other 13 Defendants in the firing. 14 Since then Billur didn't just go along with that 15 firing, she was an active participant in it and for 16 self-serving reasons that didn't protect Yasemin's 17 interests. 18 So since the injunction ruling, our concern is that 19 the Defendants have continued their abuse of the company at 20 great speed to advance their own personal interests. They 21 put on the market or sold six company properties worth 22 millions of dollars including a 35th Street property which 23 is right near Hudson Square and valued at -- Hudson Yards 24 valued at over $35 million. 25 This is a company that Billur described as one KM 5 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 6 Proceedings 1 where buying and selling is not very frequently done and 2 this is the problem we have had. Our client is no longer in 3 management. 4 Let me talk about that 35th Street property for a 5 minute. It is the crown jewel of this business. It's 6 managed by Bremen House and Yasemin's trust holds a 7 substantial interest in it. We wrote a letter earlier this 8 year complaining about that sale and immediately, literally 9 the next day the broker said despite this dispute -- he 10 called it a dispute -- the family is defiantly selling the 11 property. And more troubling, he said that they had a 12 whisper price that he was pushing of just $50 million, a 13 property that they had gotten a $75 million appraisal for, 14 and these are the sorts of decisions that are harmful to the 15 company from which Yasemin is being excluded. 16 So let me talk about the three factual bases that 17 support this motion. First is the cooperation of Yasemin's 18 sister Zeynep. She's a Bremen House director and officer. 19 She testified at her deposition that the week before the TRO 20 hearing in this case, she opposed Yasemin's firing. She 21 also testified that as was her mother's history of 22 retaliation, her mother pressured her, threatened to fire 23 her Zeynep too if she didn't go along with this firing. 24 It is remarkable that Zeynep -- that defense 25 counsel Norton Rose was on the phone for at least part of KM 6 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 7 Proceedings 1 these events, yet didn't disclose it to the Court. Instead, 2 told this Court it was a responsible act of corporate 3 governance. We think that it was anything but. 4 The second key fact is what was their motive. It 5 is virtually admitted through discovery that the only motive 6 for firing Yasemin was to take away funds so she couldn't 7 bring this lawsuit. And as Zeynep testified, her mother 8 believed that if she fired her, she wouldn't even be able to 9 bring this lawsuit. That's what she testified to at her 10 deposition, and as we'll get into a moment, that is not a 11 proper basis. 12 The third foot of the stool is Billur's active 13 involvement. Now, what has unfolded during discovery is 14 that Billur just didn't consent. She was at the table with 15 Yasemin's mother pressuring Zeynep to consent. According to 16 Zeynep, Billur was acting very aggressive. She said that 17 she shouldn't give Yasemin the funds to pursue this case. 18 Her words were -- this is Billur, Yasemin's a trustee. "You 19 can't give someone a loaded gun to use against you." That 20 has nothing to do with protecting Yasemin's interests of the 21 trustee. 22 So let me turn to why these facts support a 23 likelihood of success on fiduciary duty. First as to the 24 pressuring. What was not disclosed to Zeynep was they 25 needed her consent. KM 7 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 8 Proceedings 1 Section 3.8 of the Bylaws say you need unanimous 2 written consent to fire Yasemin. And instead, they led her 3 to believe let's all go along. They literally misled her, 4 and they did so for a motive that wasn't proper. It was 5 simply to discourage somebody from pursuing a lawsuit that 6 would expose a wrongdoing. 7 Now critically, what we get from the Defendants are 8 just conclusory denials, but I think most important, there 9 is no affidavit from Billur. She was there. There's no 10 affidavit denying any of this. So I think you have to 11 really credit these sworn statements. 12 Now, Defendants in their brief argue well, they 13 could fire Yasemin for any reason citing employment cases. 14 This isn't an employment case. This is a fiduciary duty 15 case, and the question is did they have any proper business 16 reason to fire Yasemin, and now, you know, that their sole 17 reason was to protect themselves to keep Yasemin from suing 18 them and really a classic breach of fiduciary duty. 19 Now you'll hear some post hoc justifications, 20 things like the Chick-fil-A store, which all have been 21 rebutted in the affidavit, but I think the more important 22 thing is the only reason Zeynep was told for firing Yasemin 23 was to discourage her from bringing this suit. 24 So let me turn then to Billur's fiduciary duty 25 brief. As this Court has previously acknowledged, she had a KM 8 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 9 Proceedings 1 sworn duty of undivided loyalty to Yasemin. And as the 2 proof has shown, she was an active participant in firing 3 Yasemin. And so her disregard for Yasemin's interests is a 4 classic fiduciary duty breach. She was acting to protect 5 herself. She literally said that when Yasemin asked her for 6 distributions, the only reason she disregarded it was 7 because Yasemin was suing them. She's her trustee. She has 8 to look out for Yasemin's interests, not her own interests 9 in weighing a lawsuit. 10 Discovery has also shown that Billur has benefited 11 for a huge amount of this scheme. She gets a $250 per month 12 sweetheart lease on an apartment. She has a caretaker, 13 driver services, lavish vacations, cruises, and I think most 14 importantly, a bonus that was designed to get her 15 cooperation with the Extell sale. And in the absence of a 16 Billur affidavit, none of this is denied. 17 So let me talk turn to an issue which your Honor 18 focused on at the prior hearing which is irreparable harm. 19 We believe the cases -- there are many that we cited in our 20 brief -- support the notion that the exclusion from 21 management is a classic irreparable harm. 22 For example, in the Post Broadway case, the 23 commercial division considered a real estate management 24 company very much like this, and the Court said that losing 25 management control over properties could result in KM 9 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 10 Proceedings 1 irreparable harm because the company could be bound to 2 undesirable arrangements, low rental rates -- 3 THE COURT: But she never -- she never had 4 management control; right? She was an employee. 5 MR. YOUNGER: She was a director of both companies, 6 and she was treasurer. 7 THE COURT: Right. I think most of those cases are 8 where somebody is, you know, being deprived of the right to 9 direct the operations. 10 You're saying that the right to be a director and 11 treasurer fits within those cases as well? 12 MR. YOUNGER: Exactly. 13 By the way, with Zeynep joining this case, and 14 you'll hear her motion next week, you have two-thirds of the 15 shareholders at the table, and clearly they want to fire 16 Zeynep as well. So what will happen is the minority, if 17 this injunction is not granted, will effectively take over 18 this company and have the ability to do whatever the heck 19 they want because there won't be any check on it. 20 The only other director is their lieutenant Billur. 21 So having a say in the company as a director is a critical 22 right of the shareholder. And now we have two-thirds of the 23 shareholders saying we want to make sure we have those 24 rights in this company. And by the way, it's not a 25 disruption of management. A Board of Directors is only KM 10 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 11 Proceedings 1 going to really check these major decisions like selling off 2 35th Street at a bargain basement price. That role as a 3 director is a critical one, and I think not all of the cases 4 that we cite involve majority control, but actually we have 5 majority control. We have two-thirds of the shareholders at 6 the table now and a minority is trying to keep them out of 7 the company. 8 So there is another fact in addition to the 35th 9 Street fact which gives me a lot of pause, and that is that 10 Berrin told Zeynep at the start of this case that she was 11 going to sell properties and hide the assets from Yasemin, 12 and that's exactly what we're concerned about. 13 It's not just that they're selling properties. We 14 don't know where the money is going to. They have not even 15 produced an annual financial statement for the last year, 16 and Yasemin is being denied information. 17 When she asked for information about the 35th 18 Street sale, she was told to get lost. Literally, get lost 19 by the Defendants. We were only able to get these documents 20 by subpoenaing the broker, and so it's not just being 21 excluded from management. It's being excluded from 22 information. 23 There is a second ground for irreparable harm. 24 Yasemin can no longer a afford fertility treatment. She's a 25 42-year old woman. Every day that she's denied those KM 11 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 12 Proceedings 1 fertility treatments which are not covered by insurance is a 2 day that she will not be able to have a child on her own. 3 The Defendants callously as they often do in their papers 4 make light of the situation. They refer to her nonexistent 5 future descendent. She deserves better than that, your 6 Honor, and the Court has the power to make sure that Yasemin 7 and her sister have a proper say in this company, and the 8 time is now to do that. 9 So let me talk about the final factor which is 10 balancing of the equities. As I said before, Yasemin and 11 Zeynep collectively hold two-thirds of this company. The 12 assets are supposed to go to three sisters. And yet, she's 13 treating this as this is her own sort of power grab as her 14 own company. And so we believe that far from undermining 15 governance as the Defendants would have, granting this 16 injunction would maintain the status quo as it existed on 17 the day your Honor first heard this summary judgment motion 18 over a year ago such that the two-thirds of the company will 19 be adequately represented. And with that, I appreciate you 20 taking the time, and I would ask you for the preliminary 21 injunction. 22 THE COURT: One thing I wanted to ask about, there 23 are some points made in your papers that shareholders of 24 this particular company as it's been run get their returns 25 through salaries for positions which they may or may not -- KM 12 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 13 Proceedings 1 well -- for salaries for positions as opposed to dividends 2 or other -- what is the distribution of profits to Yasemin, 3 for example, in the absence of a salary? I saw references 4 to pensions and the like, but I don't have a sense for what 5 is the cash flow to Yasemin in this business. 6 MR. YOUNGER: Your Honor, that's a critical 7 question. The pension has nothing to do with it. That was 8 money she set aside from her salary so she could take care 9 of herself when she retired. Sadly, she's drawing down now. 10 The distributions to Yasemin from this company are 11 zero. So she's a one-third owner of a company. She asked 12 her trustee once her salary was denied to make 13 distributions. Her trustee didn't even get back to her. 14 THE COURT: Make distributions from what? 15 MR. YOUNGER: From the company. 16 THE COURT: How can the -- how can -- in other 17 words, does the trust receive funds from the company? 18 MR. YOUNGER: The trust has not received funds, and 19 I believe this was based on Norton Rose's advice. And your 20 Honor's probably aware that there's more beneficial tax ways 21 to the company to base salaries than to pay distributions. 22 So historically, Ms. Billur's testimony at her 23 deposition is that the company pays salary, not 24 distributions. So the result of denying the injunction a 25 year ago and allow them to fire my client is she owns KM 13 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 14 Proceedings 1 one-third of a multi-million dollar company and gets zero. 2 THE COURT: Again, so there are no dividends to the 3 trust as shareholders? 4 MR. YOUNGER: Correct. And she asked for it, and 5 that request was denied as I said simply because she was 6 suing the company. 7 So right now Yasemin doesn't even own stock. She 8 has no information, no say-so in management, and she has no 9 discretion whatsoever from a company for which her trust 10 owns one-third, and that's just not right. 11 And Page 1 of their brief, they say this company is 12 for the benefit of all the shareholders. My client is 13 getting no benefit. None. 14 THE COURT: All right. Thank you. 15 MR. YOUNGER: Thank you, your Honor. 16 MS. ARCHER: Thank you, your Honor. 17 I will address some of those points as I go. Happy 18 to answer that question if you'd like now or I can address 19 it later. 20 Ultimately, you know, as we sit here, 15 months ago 21 your Honor denied Yasemin a preliminary injunction and 22 temporary restraining order on the grounds that she had not 23 established the likelihood of success on the merits and had 24 not established irreparable harm because any harm that was 25 being alleged could be redressed with money damages. KM 14 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 15 Proceedings 1 I think the case has not changed so drastically. 2 And in fact, the facts that have been put before your Honor 3 on this alleged motion to renew were largely before the 4 Court when you decided this to begin with; the issues with 5 respect to mismanagement of the company, the issues with 6 respect to the allegations that Billur B-I-L-L-U-R not 7 "Buller" have had a conflict. She has been deposed, and her 8 testimony is before the Court. And Mr. Younger has not 9 represented it accurately. But the motion to renew requires 10 that there being material facts that existed at the time but 11 that were unknown and that would have changed the result, 12 and we don't believe that standard has been met. We don't 13 believe that the Plaintiff has established anymore 14 likelihood of success based on blocking out a few documents 15 in a several hundred thousand document production or citing 16 to a couple of depositions when a number of depositions have 17 yet to take place including the broker and two of the 18 defendants who have not yet been deposed. 19 So we believe that, you know, this is -- this is an 20 effort to reinstate Yasemin in cooperation with her sister 21 Zeynep who has now switched sides and the -- 22 THE COURT: Do you agree just on the math that the 23 two trusts that Zeynep and Yasemin would hold two-thirds of 24 the equity? 25 MS. ARCHER: I agree that the two trusts hold KM 15 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 16 Proceedings 1 two-thirds of the equity, yes. I don't agree that that 2 changes anything. Ultimately, they're both employees of the 3 company. Zeynep has not been threatened with being fired. 4 We'll address that on Monday. 5 Yasemin was creating a situation that was so 6 problematic that led to her termination and ultimately was 7 likely secret recordings with employees and with accountants 8 and yelling at employees and taking positions that were 9 incredibly disruptive and dangerous to the way the company 10 was proceeding with respect to a large real estate sale and 11 with respect to turning exchange properties to be able to 12 create more income for the companies. 13 Yasemin hasn't asserted or established anymore of a 14 likelihood of success at this point given how much discovery 15 is still to be had and given how little they have actually 16 pointed to and I would say misrepresented drastically. 17 But also, there is still no irreparable harm. I 18 think your Honor correctly referred to the case law which is 19 very different than the situation here. This is not a 20 situation where the Plaintiff or any of the individuals have 21 a right to be employed forever. 22 In fact, Yasemin and Zeynep have done very little 23 for the company for a number of years. 24 THE COURT: Well, if you have a company where the 25 shareholders -- I mean, you can operate companies lots of KM 16 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 17 Proceedings 1 different situation. Generally speaking, in a typical 2 company, shareholders would share in the profits of the 3 company through distributions or dividends or whatever. But 4 the assertions made here that -- and we'll get into this. 5 This company has got some issues, it seems to me, but one of 6 them is that in lieu of that normal kind of shareholder 7 relationship, people get their money through salaries and 8 perks and the like so that these shareholders at the whim of 9 as you said -- you know, people can be fired from employee 10 positions, but if that in the way this company works is 11 literally the only way shareholders have any upside in the 12 company, doesn't that change the scenario a bit? 13 MS. ARCHER: Well, your Honor, the -- the three 14 daughters are not shareholders directly. They are 15 beneficiaries of three trusts. 16 THE COURT: Well, they're trusts. 17 MS. ARCHER: Which are shareholders. Each of those 18 trusts holds a more than $10 million note payable to them. 19 This was all an estate planning that Berrin did not have to 20 do, but she put these monies in trust, and there are 21 separate trusts that are much smaller percentage ownerships 22 was respect to the 35th Street property which is not owned 23 by Bremen House and which is owned by a company that your 24 Honor dismissed from this case. 25 THE COURT: So just so I'm clear, so the trusts KM 17 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 18 Proceedings 1 have 10 million in cash? 2 MS. ARCHER: No. The trusts owe $10 million because 3 that was the only way that the trust could and ultimately 4 the beneficiaries after Berrin's death which is what this 5 was supposed to be could avoid certain taxes. 6 THE COURT: Did they receive funds in exchange for 7 those notes? 8 MS. ARCHER: They received shares in the company. 9 THE COURT: Right. So all they have are illiquid 10 shares, no cash flow and a $10 million note -- 11 MS. ARCHER: That's right. 12 THE COURT: -- that they have to pay back. 13 MS. ARCHER: And that's the way these were set up, 14 all with their knowledge and consent because they were 15 getting -- 16 THE COURT: Well, at the time the way this business 17 seems to operate, and even your client seems to suggest that 18 she had this treasurer title which she didn't really do 19 anything, that just seems to be the way the compensation 20 model such as it is worked. And now taking, you know, 21 unilateral action to say, all right, we set it up this way, 22 the trusts aren't going to get any actual dividends when we 23 sell properties or whatever, but you'll make your money as 24 an employee and then you turn that off and now she's -- the 25 trust is not giving her anything. The company is not giving KM 18 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 19 Proceedings 1 her anything except for, you know, the property she's living 2 in. It is kind of a rug being pulled out from under them; 3 isn't it? 4 MS. ARCHER: Well, your Honor, there wasn't a 5 situation where they sat down and were promised oh, don't 6 worry, you'll get a salary forever. This was -- I mean, 7 they were supposed to be working at the company and 8 participating. And unfortunately, Yasemin and Zeynep 9 decided to do other things. And so Berrin continued to 10 support them in many ways, not just salary, but from her 11 personal funds with vacations that she paid for, with help 12 on fertility treatments that she had been willing to do at 13 the time. 14 I don't think it can be argued that, you know, 15 she's probably not being unreasonable in not continuing to 16 do that given what her daughter said about her. But this 17 was not a situation where there was documented -- where 18 there were promises. 19 The Bylaws of the company allow the employees to be 20 terminated under a certain process. And so, Mr. Younger has 21 mentioned that that process requires a consent from all of 22 the shareholders. It actually -- there are alternatives. 23 And while that was the process used at this point and Zeynep 24 willingly signed two consents; although she now apparently 25 says that that didn't happen or that she had a gun to her KM 19 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 20 Proceedings 1 head. That's not what she said in her deposition, by the 2 way. 3 THE COURT: What would stop these two 4 shareholders -- the two trusts if the beneficiaries couldn't 5 get the trustees to do it to insist on payment of dividends 6 or change the way the company works? Is there something in 7 the corporate documents that would permit the two-third 8 shareholders from -- through their representatives from 9 changing things? 10 MS. ARCHER: There are trust documents that lay out 11 what the obligations and the rights are of the beneficiaries 12 and the trustee, and the trustees are not required to make 13 distributions. And in this case, there wasn't anything to 14 distribute. 15 THE COURT: I'm not talking about that at that 16 level. 17 The trusts are the shareholders in Bremen House. 18 So why couldn't the two trustees for the two trusts -- I'm 19 not sure if they are the same person. But does the Zeynep 20 trust interest and the Yasemin trust, is the trustee the 21 same person? 22 MS. ARCHER: Yes. 23 THE COURT: So if counter to the facts that that 24 trustee decided for the benefit of the beneficiaries, would 25 they have the power, those two trusts together with their KM 20 of 66 FILED: NEW YORK COUNTY CLERK 02/14/2023 12:12 AM INDEX NO. 657193/2020 NYSCEF DOC. NO. 1239 RECEIVED NYSCEF: 02/14/2023 21 Proceedings 1 two-thirds voting interest, is there anything in the 2 corporate documents that would prevent them from changing 3 the way the company works? 4 MS. ARCHER: I believe that that's not -- I mean, 5 the trusts are in place and the beneficiaries receive the 6 benefits after Berrin's death. So these are grantor trusts 7 that are not -- the expectation and the documents don't 8 anticipate that they would be able to if their trustee -- 9 one or both of their trustees say we don't want to be 10 involved, we just want our money that they could then break 11 up the companies and distribute it to the trust. 12 THE COURT: Right. I'm trying to get at what the 13 corporate documents say. There are shareholders. And do 14 the shareholders not have the rights that shareholders 15 normally have? 16 MS. ARCHER: The shareholders have certain