Complaint,Petition: David L. Abramson M.D., Scot B. Glasberg M.D. v. 74th Llc, Ben Heller

On February 13, 2014 a Complaint,Petition was filed involving a dispute between David L. Abramson M.D., Scot B. Glasberg M.D., and 74Th Llc, Ben Heller, for Real Property - Other in the District Court of New York County.

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FILED: NEW YORK COUNTY CLERK 05/16/2014 INDEX NO. 151330/2014
NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 05/16/2014

SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
X

DAVID L. ABRAMSON, M.D. and : Index No. 151330/14
SCOT BRADLEY GLASBERG, M.D.,
FIRST AMENDED
Plaintiffs, VERIFIED
COMPLAINT
V.

74TH LLC and BEN HELLER,

Defendants.

Plaintiffs David L. Abramson, M.D. and Scott Bradley Glasberg, M.D. (collectively,

"Tenants"), by and through their attorneys, Pryor Cashman LLP, as and for their Verified

Complaint against defendants 74th LLC and Ben Heller (collectively, "Landlord"), respectfully

allege as follows:

NATURE OF THE ACTION

1. Tenants lease the ground floor and a portion of the basement (the "Premises") in

the building known as and located at 42 East 74th Street, New York, New York (the "Building").

2. At the Premises, Tenants operate one of the tri-state area's most successful plastic

surgery practices.

3. As evidenced by real estate listings and a notice sent to Tenants, Landlord, which

owns the entire Building, a townhouse, desired to sell the Building. Upon information and

belief, Landlord desired to rid the Building of Tenants prior to such sale, in order to present an

empty Building to any potential purchaser.
4. However, there are a number of provisions in the subject lease between Landlord

and Tenants with which Landlord must comply in order to be able to unilaterally terminate

Tenants' right to remain at the Premises, including a six-month notice-of-termination provision

and an associated fee equivalent to nine months rent, or approximately $111,000.00.

5. In order to proceed with the intended sale while avoiding the termination-related

pay-out to Tenants, Landlord has fabricated a pretextual set of circumstances in an attempt to put

Tenants in technical default under the lease, thereby allowing Landlord to terminate the lease on

a much shorter timeline without having to pay the termination fee.

6. Specifically, Landlord created, out of whole cloth, and for the first time, a claim

that Tenants suddenly owe allegedly unpaid taxes for each year going back to 2009, even though

Landlord had never before complained that Tenants failed to make additional rent payments or

demanded payment of such amounts. Indeed, Landlord admitted in writing that throughout the

lease Tenants never failed to make additional rent payments when they were due.

7. In short, Landlord invented additional rent charges from the past and accused

Tenants of being in default for failing to pay the made-up charges, for which Landlord never (in

13 years) requested payment, with the obvious intent to gain some perceived leverage by

escaping payment of the termination fee, avoiding the six-month notice of termination

requirement, and circumventing all of its other obligations as landlord of the Building (which

obligations, as explained below, Landlord has not met).

8. Landlord's unsuccessful attempt to terminate a long-standing commercial lease

agreement by demanding payment of incorrect additional rent amounts, to escape payment of the

termination fee, constituted a breach of the lease as well as a breach of Landlord's duty of good

faith and fair dealing.

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9. Due to all of the foregoing, on or about February 13, 2014 Tenants were forced to

initiate this action against Landlord. On March 5, 2014, subsequent to the commencement of

this action and after Landlord was served with Tenants' Complaint, Landlord's attorney

withdrew the notices demanding payment of additional rent payments, expressly admitting that

the Tax Statements that previously had been served by Landlord were incorrect and had been

prepared using incorrect information.

10. In fact, throughout the 14 years of the lease, Tenants complied with all their

obligations, and paid Landlord all the rent and additional rent for which they received statements

and underlying bills (the required procedure under the lease).

11. Also on March 5, 2014, Landlord served Tenants with a Notice of Termination of

the Lease (as defined below), stating that Landlord had previously notified Tenant on November

11, 2013 and November 27, 2013 that he was interested in selling the Property and offered them

the right to purchase the Property and Tenants had not elected to purchase the Building. In such

Notice of Termination, Landlord elected to terminate the Lease, effective on September 10,

2014, such date being six months after the delivery of the Notice of Termination of the Lease.

12. Thereafter, Tenants relied on the Notice of Termination of the Lease and acted

upon it. With the Notice of Termination of the Lease indicating that the lease would terminate

on September 10, 2014, Tenants engaged a broker and began an extensive search to lease new

medical office space in Manhattan.

13. However, on March 26, 2014, Landlord attempted to withdraw the Notice of

Termination of the Lease, in an unsuccessful attempt to revoke the termination of the Lease (to

avoid once again the payment of the termination fee equivalent to nine months of rent).

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14. Pursuant to Landlord's own determination, set forth in the Notice of Termination

of the Lease, the lease agreement will irrevocably terminate on September 10, 2014. Moreover,

and pursuant to Article 61 of the Lease, Landlord must pay Tenants the termination fee on the

date that Tenants vacate the Premises.

15. Finally, Landlord has failed to maintain the Building and the Premises in

accordance with the requirements of the lease for years, by, among other things, refusing to

repair its heating and ventilating system, causing a dangerous condition that routinely results in

temperatures exceeding 80 degrees in Tenants' treatment rooms, causing various of Tenants'

patients to pass out. Landlord's breaches have detrimentally affected Tenants' medical practice.

16. As more fully explained below, this issue has been a critical and worsening

problem for years.

17. Finally, in addition to failing to address the issue of the lack of ventilation,

Landlord has also failed to provide Tenants with full access to certain portions of the Premises,

despite collecting rent.

18. Landlord's breaches of the lease and tortious conduct have caused Tenants

significant harm and aggravation in the course of their medical practice and resulted in

significant damages for which Landlord should be held liable. Landlord's failure to perform its

obligations, coupled with its scheme to prematurely terminate the lease and then to attempt to

avoid the termination of the lease once the notice of termination had been served and to escape

still more obligations, constitutes improper conduct for which Tenants seek judicial intervention

and relief through this complaint.

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THE PARTIES

19. Tenants are natural persons and are both medical doctors licensed to practice and

currently practicing in the State of New York who maintain a place of business in the County,

City and State of New York.

20. Upon information and belief, Ben Heller is a natural person residing at 42 East

74th Street, New York, New York. Ben Heller is 74th LLC's predecessor-in-interest to the

Building.

21. Upon information and belief, 74th LLC is a limited liability company organized

and existing under the laws of the State of New York, with its principal place of business located

in the County, City and State of New York. Upon information and belief, 74th LLC is Ben

Heller's successor-in-interest to the Building.

JURISDICTION AND VENUE

22. Jurisdiction is appropriate pursuant to CPLR 302(a)(1).

23. Venue is appropriate pursuant to CPLR 507.

FACTUAL BACKGROUND

A. The Lease

24. On or about November 18, 1999, Tenants, as "Tenant" and Ben Heller, as

"Owner," entered into a written lease agreement for the rental of the Premises (the "Lease"). A

true, correct, and complete copy of the Lease is attached hereto as Exhibit A.

25. The Lease consisted of an initial 10-year term, which commenced on April 10,

2000, when Landlord delivered possession of the Premises to Tenants, and expired on March 31,

2010. (Exhibit A, p.1).

26. Article 61 of the Lease permits Tenants the right to exercise a single five-year

extension of the initial Lease term, commencing on April 1, 2010. (Exhibit A, Article 61).
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27. On or about April 13, 2009, Tenants timely exercised that right. A true, correct

and complete copy of Ben Heller's April 13, 2009 letter confirming the extension of the Lease is

attached hereto as Exhibit B.

28. Pursuant to Tenant's extension, the extended Lease is set to expire on March 31,

2015 (the "Extended Lease Term").

29. Upon information in belief, also in 2009 Ben Heller transferred his entire

ownership interest in the Building to 74th LLC and, consequently, 74th LLC became Ben

Heller's successor-in-interest to, and the de facto landlord under, the Lease.

30. The Lease requires Tenants to pay base rent which progressively escalated from

$8,000.00 per month during the first year of the Lease to $11,000.00 per month from April 1,

2010. The base rent increases 3% for each year of the Extended Lease Term. (Exhibit A,

Articles 38, 61(A)).

31. The Lease also calls for Tenants to pay "additional rent" which, among other

items, includes a portion of the Building's real estate tax charges and water charges. (Exhibit A,

Articles 40, 41(d)).

32. With respect to Tenants' real-estate tax and water payment obligations, the Lease

expressly requires Landlord to provide a statement of the charges accompanied by a copy of the

relevant bill. Provided Landlord properly complies with those preconditions, Tenants are

required to pay the stated amounts within 10 days after the statements and accompanying bills

are provided by the Landlord. (Exhibit A, Articles 40(C), 41(D)).

33. If Tenants fail to make any additional rent payments, Landlord must give Tenants

written notice of their failure to pay. (Exhibit A, Article 43(A)(3)).

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34. The Lease requires Landlord to "maintain in good working order and repair...the

building.. .heating and ventilation systems... serving the demised premises." (Exhibit A, Article

4).

35. The Lease further requires Landlord to provide an "air conditioning/cooling and

ventilating system," and in particular "ventilation will be furnished on business days" during

business hours unless air conditioning already is being furnished. (Exhibit A, Article 29).

36. The Lease also more generally gives Tenants the right to "peaceably and quietly

enjoy" the Premises, which right of quiet enjoyment Tenants maintain in any event as a matter of

common law. (Exhibit A, Article 23).

37. If Landlord desires to sell the Building during the term of the Lease, the Lease

grants Tenants a right of first refusal. Pursuant to that right, Landlord must provide Tenants with

written notice of any proposed sale prior to offering the Building for sale to any third party.

Under the Lease, the written notice must include the price and "other material terms and

conditions" on which Landlord wishes to sell the Building. (Exhibit A, Article 61(B)).

38. If Landlord desires to terminate the Lease prior to the expiration of the Lease, the

Lease requires that Landlord (i) provide written notice to Tenants at least six months prior to the

termination date and (ii) pay to Tenants a termination payment in the amount of nine times the

current monthly rent (the "Termination Fee") on the date that Tenants shall vacate the Premises.

(Exhibit A, Article 61(C)).

B. The Parties' Conduct and Landlord's
Failure to Repair the Systems of the Premises

39. Throughout the term of the Lease, Tenants have paid all rent charges in

accordance with the Lease.

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40. Throughout the term of the Lease, Tenants have paid all real estate tax charges

upon receipt of the required statements and accompanying bills.

41. Throughout the term of the Lease, Landlord never provided Tenants any

statements and/or bills with respect to the Building's water charges.

42. Beginning in or about 2011, Tenants began experiencing problems with the

Building's heating and ventilation systems, which problems had the effect of significantly

increasing the temperatures in the treatment rooms and in one of the staff rooms of Tenants'

medical practice to over 80 degrees Fahrenheit, directly affecting the safety and health of

Tenants as well as their patients and staff. Landlord transferred the heating system and certain

concomitant elements of the ventilation system to a different area of the basement of the

Building. After Landlord made that change, heat started emanating from the basement of the

Building to the first floor of Tenants' medical practice.

43. Tenants repeatedly complained to Landlord about the problems with the heating

and ventilation systems and explained to Landlord the detrimental impact that the heating and

ventilation problems were having on Tenants' medical practice, but Landlord did nothing to

remedy the issues with the systems.

44. Tenants continued to inform Landlord of the heat problem on the Premises and

continued to request that the heating and ventilation system be repaired immediately.

45. Landlord still refused to repair the problem.

46. Meanwhile, the temperature in the treatment rooms got increasingly worse.

Indeed, even with the heating system turned entirely off, the heat in the treatment rooms and the

affected staff room are regularly above 80 degrees Fahrenheit. On several occasions, Tenants'

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patients have passed out in the treatment rooms as a direct result of the excessive heat, requiring

emergency hospitalization.

47. Further, the heating issue has detrimentally and significantly affected Tenants'

medical practice. Patients prefer not to be treated by Tenants, due to the increasingly high

temperature that exist in all of Tenants' treating rooms.

48. Landlord finally agreed to hire consultants to analyze the problem. The proposal

prepared by one of the consultants determined that several installments needed to be made (for

the total cost of $9,500.00) to address the problem. However, Landlord again refused to fix the

problem and did not hire the consultants to perform the reparations. A true, correct and complete

copy of the proposal is attached hereto as Exhibit C.

49. On or about November 18, 2013, Tenants sent to Landlord a letter (the

"November 18 Letter") regarding the heating issue and advising Landlord that the issue was

significantly affecting the safety and health of the patients and staff:

Specifically, with ALL heating elements and devices fully turned off the
temperatures in our treatment rooms routinely run above 80 degrees
Fahrenheit. As you know, we are physicians treating patient in varying states of
health. These elevated temperatures are intolerable to both our patients and our
staff. On several occasions, we have had patients actually pass out in the
office due to these temperatures. You have acknowledged the problem and
even had multiple consultants come in to evaluate the situation. These individuals
have submitted to you at least two different courses of action to resolve this
heating issue. However, despite these plans presented by consultants hired by
you, you have neglected to address and ignored the issue. [Emphasis added; a
true, correct, and complete copy of the November 18, 2013 letter is attached
hereto as Exhibit D.]

50. Notwithstanding the gravity of the situation, to this date Landlord continues to

refuse to repair the heating problem at the Premises and the temperatures of Tenants' treatment

rooms have not been reduced, despite Landlord's obligation, pursuant to the Lease, to maintain

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in good working order and repair the heating/ventilating systems of the Building and the

Premises. (Exhibit A, Article 4).

51. Further, Landlord never installed a separately controlled heating, ventilating and

air conditioning for the general medical office space requirements, as set forth under Article 56

of the Lease (as part of "Owner's Work"- Exhibit B of the Lease). Accordingly, the provisions

set forth in Article 56 of the Lease are inapplicable.

52. Notwithstanding this, even if Article 56 of the Lease were applicable to the

heating issue of the medical office described above, pursuant to the same provision, Landlord

"shall be responsible for the repair and maintenance of the structural elements of the Building

and the building systems servicing the demised Premises except to the extent the same are

necessitated by Tenant's Failure to perform its obligations under this Lease." Therefore, and

even under Article 56 of the Lease, Landlord would still be responsible for the repair and

maintenance of all of the building systems servicing the Premises and consequently is liable to

Tenants for its continued failure to repair the heating issue in the Premises.

53. As the Lease sets forth, the Premises are used as the private medical office space

of Tenants, and the heating issue has substantially and detrimentally affected Tenants' medical

practice and Tenants' use and quiet enjoyment of the Premises. (Exhibit A, Article 23).

C. Landlord's Various Attempts to Avoid Payment of the Termination Fee

54. On or about November 11, 2013, Landlord notified Tenants by letter (the

"November 11 Letter") that Landlord had listed the Building for sale at a price of

$17,600,000.00:

Separately, note that the lease requires me to give you notice if I wish to sell the
building. This is to advise that I have just given the Edward L. Cave division of
Brown, Harris, Stevens the listing to sell the building at a sale price of

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$17,600,000.00. Should you desire to buy the building and have the financial
capacity to do so, please advise. [A true, correct, and complete copy of the
November 11, 2013 letter is attached hereto as Exhibit E.]

55. On or about November 27, 2013, Landlord delivered to Tenant a letter with the

subject line "Notice of First Opportunity to Acquire 42 East 74th Street (the "November 27

Notice"), which Landlord claimed was an official notice of sale that would trigger Tenants' right

of first refusal pursuant to Article 61(B) of the Lease.

56. The November 27 "Notice" specifically stated, inter alia:

Please take notice that Owner desires to sell the building, in its existing physical
condition, for $ 17,600,000.00, all cash. Accordingly, this document constitutes
the Offer Notice referenced in the Lease Agreement. In the event that you elect to
purchase the building for the price and material terms set forth above, you must
proceed in strict accordance with all of terms and requirements of the Lease, time
being of the essence. [A true, correct, and complete copy of the November 27,
2013 notice is attached hereto as Exhibit F.]

57. Though the November 27 Notice did not satisfy the requirements of Article 61(B)

of the Lease and was facially as an official notice of sale under that provision, Landlord

subsequently clarified and addressed those apparent defects.

58. In particular, by letter dated March 5, 2014, Landlord clarified the issues raised by

Plaintiffs in a way that left Plaintiffs satisfied that the notice was compliant with Article 61(B) of

the Lease (A true and correct copy of the March 5, 2014 Letter is attached hereto as Exhibit G).

59. Further, by additional notice dated March 5, 2014 (attached to the March 5, 2014

Letter), Landlord served Tenants with a "Notice of Termination of Lease" ("Notice of

Termination of Lease"), which constituted formal notice of termination of lease in accordance

with Article 61(C) of the Lease, by which Landlord elected to terminate the Lease effective

September 10, 2014 (such date being six (6) months following the date of the notice). A true and

correct copy of the Notice of Termination of Lease is attached hereto as Exhibit H.

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60. Specifically, pursuant to the Notice of Termination of Lease, Landlord proposed

to sell the Building to a third party and elected to terminate the Lease:

In accordance with article 61(C) of the Lease, Owner hereby elects to terminate
the lease effective on September 10, 2014, such date being six (6) months
following the delivery of this notice.

61. Once Landlord sent the March 5, 2014 Notice, Tenants commenced a search for

alternative medical office space pursuant to the Notice of Termination of Lease. Tenants

immediately engaged a broker and began an extensive search to lease a medical office in

Manhattan, and expended substantial amount of time and effort in their search.

62. However, almost a month later, Landlord served Tenants with a "Withdrawal of

Notice of Termination of Lease" (the "Withdrawal of Termination of Lease") dated March 26,

2014, in which Landlord purported to withdraw the Notice of Termination of Lease (presumably

to avoid once again payment of the Termination Fee). A true and complete copy of the

Withdrawal of Termination of Lease is attached hereto as Exhibit I.

63. However, pursuant to Article 61 of the Lease and the relevant provisions of the

law, Landlord may not simply unilaterally withdraw the Notice of Termination of the Lease

without Tenants' express consent.

D. Landlord Serves Tenants with a Defective Notice to Cure

64. Landlord has also fabricated unpaid additional rent charges in an attempt to put

Tenants in default under the Lease, thereby allowing Landlord to terminate the Lease without the

required six-month notice and without paying the Termination Fee.

65. Specifically, in the November 11 Letter, Landlord claimed that Tenants owed

payment for 2013 real estate tax charges in the amount of $13,250.00, although Landlord

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correctly admitted that Tenants had paid their real estate tax charges for every other year of the

Lease:

"The lease agreement is totally clear.. .that you must make monthly rental
payments plus pay "Tenants Proportionate Share" of all annual real estate tax
payment in the amount of 25%....You have made these payments each
year...You have been informed that this year the tax has increased from the
original $26,000 to $79,000. You owe 74th LLC 25% of the difference, 25% of
$53,000, or $13,250.00." [See Exhibit E; emphasis added.]

66. Tenants since have paid Landlord the $13,250.00 real estate tax charge due for

2013 and therefore are current with respect to their real estate tax obligations under the Lease. A

true, correct, and complete copy of Tenants' 2013 additional rent check, which Landlord cashed,

is attached hereto as Exhibit J.

67. In the November 11 Letter, Landlord also stated for the first time that Tenants

suddenly owed Landlord $1,000.00 for water charges for calendar year 2013, but failed to

provide any supporting documentation whatsoever to back up that amount, in contravention of

the terms of the Lease.

68. In the November 11 Letter, Landlord also admitted that throughout the Lease it

had never demanded that Tenants pay any portion of the Building's water charges.

69. On or about January 22, 2014, Landlord sent to Tenants a document entitled First

Notice to Cure (the "January 22 Notice"), which stated the following:

Take notice that you are justly indebted to the Landlord of the above described
Premises in the amount of $47,327.47 representing Tenant's Tax Payment for the
years 2009, 2010, 2011, 2012 and 2013 and you are justly indebted to Landlord of
the above described Premises in the amount of $836.22, representing Tenant's
Water Payment for the years 2010, 2011, 2012 and 2013. You are required to pay
the total sum of $48,163.69 on or before the expiration of the three days from the
day of the service of this Notice, or surrender up the possession of said Premises
to the Landlord, in default of which the Landlord will terminate the Lease and
commence summary proceedings to recover the possession of the Premises." [A
true, correct, and complete copy of the January 22, 2014 Notice is attached hereto
as Exhibit K.]

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70. Landlord followed up the January 22 Notice with a Notice of Termination dated

February 4, 2014 (the "February 4 Notice"), which purported to give Tenants notice that the

Lease would terminate in 5 days. A true, correct, and complete copy of the February 4, 2014

Notice is attached hereto as Exhibit L.

71. After serving the Complaint, Landlord withdrew the January 22 and February 4

Notices, expressly admitting that it had used incorrect information when preparing such notices

("It is true that the Tax Statements were prepared using incorrect information"). $ee Exhibit G.

72. However, Landlord's erratic conduct in repeatedly serving and then withdrawing

notices has significantly prejudiced Tenants by forcing them to spend time, effort and a

substantial amount of funds in attorneys' fees, which Tenants seek to recover.

E. Landlord Has Not Allowed Tenants to use the
Basement or Pantry Area as Specified in the Lease

73. Under the Lease, Tenants have a license to use a portion of the basement

identified in the Lease (the "Basement") for storage of files, record keeping and like matters.

(Exhibit A, Article 46(B)). In addition, Tenants were given a license to use the portion of the

basement located outside the Premises for warming and heating of food and the like for

consumption in the Premises and they were allowed to place a refrigerator in such area (the

"Pantry Area").

74. However, and despite Tenant's continuous complaints, to this day Landlord has

failed to remove all of its personal property from the Basement, thereby failing to provide

Tenants with full access to the Basement and, accordingly, a portion of the Premises.

75. To this date, Tenants are not able to use the Basement for the matters specified in

the Lease. Tenants can only store a limited amount of files in the Basement because the rest of

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the Basement space is occupied by Landlord, who even transferred the heating system and

certain concomitant elements of the ventilation system to the Basement (thus preventing Tenants

from using the Basement). Photographs of the Basement and Pantry Area are attached hereto as

Exhibit M.

76. Further, the Pantry Area was never properly conditioned by Landlord, so it was

never used by Tenants for any of the uses specified in the Lease.

AS AND FOR A FIRST CAUSE OF ACTION
(Declaratory Judgment)

77. Plaintiffs repeat and reallege the allegations contained in paragraphs 1 through 76

above as if fully set forth herein.

78. By Notice of Termination of Lease dated March 5, 2014, Landlord terminated the

Lease effective on September 10, 2014, in accordance with article 61(C) of the Lease.

79. Landlord's subsequent Withdrawal of Notice of Termination of Lease dated

March 26, 2014 is defective and a nullity because Landlord is not allowed to unilaterally

withdraw the Notice of Termination of Lease.

80. Upon information and belief, Landlord believes it has the legal and contractual

right to withdraw the Notice of Termination. In other words, upon information and belief,

Landlord disputes these contentions.

81. Tenants are not in default under the Lease.

82. Tenants have no adequate remedy at law.

83. By reason of the foregoing, Tenants are entitled to a declaration that (a) the

Notice of Termination of Lease dated March 5, 2014 terminated the Lease effective on

September 10, 2014; (b) Landlord must pay Tenants nine (9) times the monthly Base Rent, as set

forth in Article 61(C) of the Lease upon Tenants' vacatur of the Premises on September 10,

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2014, in accordance with Article 22 of the Lease; (c) the Withdrawal of Notice of Termination of

Lease dated March 26, 2014 is defective, null and void; and (d) Tenants are not in default of their

obligations under the Lease.

AS AND FOR A SECOND CAUSE OF ACTION
(Breach of Lease)

84. Plaintiffs repeat and reallege the allegations contained in paragraphs 1 through 83

above as if fully set forth herein.

85. The Lease constitutes a legally binding and enforceable contract.

86. Tenants have fully complied with all of their obligations under the Lease.

87. Landlord has breached the Lease by serving incorrect Tax Statements to Tenants.

88. Among other provisions as noted above, Article 4 of the Lease requires Landlord

to "maintain in good working order and repair...the building...heating and ventilation

systems...serving the demised premises."

89. As detailed above, the heating and ventilation systems at the Premises were so

defective as to have a significantly negative impact Tenants' medical practice and, as a direct

result, caused Tenants to lose patients and significant revenue.

90. As required under Article 4 of the Lease, Tenants gave Landlord "prompt notice"

of the defective condition of the Building's heating and ventilation system and its negative

impact on the Premises.

91. Landlord has breached Article 4 of the Lease by failing, after receiving notice of

the defective condition of the Building's heating and ventilation system, to repair that defective

condition.

92. Article 23 of the Lease gives Tenants the right to "peaceably and quietly enjoy"

the Premises.

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93. As required under Article 23 of the Lease, Tenants have paid all rent and

additional rent and have observed and performed all terms, covenants, and conditions on their

part to be observed and performed.

94. Landlord has breached Article 23 of the Lease and Tenants' common right to

quiet enjoyment of the Premises by failing to rectify the Building's defective heating and

ventilation system which is having a significantly negative impact on Tenants' medical practice.

95. Upon information and belief, Landlord has breached Article 61 by purporting to

withdraw the Notice of Termination of Lease and attempting to avoid payment of the

Termination Fee.

96. Further, Landlord has breached Article 46(B) of the Lease, by failing to allow

Tenants to use the Basement and Pantry Area by failing to remove its personal property, and thus

not allowing Tenants to use the Basement for storage of files, record keeping and like matters.

97. Landlord is liable to Tenants for all damages, including lost profits, resulting from

its various breaches of the Lease in an amount to be determined at trial, but in no event less than

$300,000.00, plus interest.

AS AND FOR A THIRD CAUSE OF ACTION
(Breach of Covenant of Good Faith and Fair Dealing)

98. Plaintiffs repeat and reallege the allegations contained in paragraphs 1 through 97

above as if fully set forth herein.

99. As party to the Lease, Landlord owes to Tenants an implied duty of good faith

and fair dealing.

100. Upon information and belief, the January 22 Notice and the February 4 Notice—

which requested payment of unsupported and previously undisclosed real estate tax and water

charges—were sent to Tenants in an attempt to create an event of default under the Lease, which

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event of default was intended to allow Landlord to terminate the Lease without following the

termination provision set forth in Article 61(C) of the Lease.

101. Landlord's attempt to withdraw the Notice of Termination of Lease is in bad faith

and is an attempt to injure Tenants' right to vacate the Premises on September 10, 2014 and to

receive payment of the Termination Fee, as set forth under Article 61 of the Lease, and thus

Landlord has violated its implied duty of good faith and fair dealing.

102. Landlord is liable to Tenants for all damages resulting from its breach of the

covenant of good faith and fair dealing in an amount to be determined at trial, but in no event

less than $300,000.00, plus interest.

AS AND FOR A FOURTH CAUSE OF ACTION
(Attorneys' Fees, Costs and Expenses)

103. Plaintiffs repeat and reallege the allegations contained in paragraphs 1 through

102 above as if fully set forth herein.

104. Pursuant to Article 44 of the Lease, Landlord agreed to indemnify and save

harmless Tenant from and against any and all liability arising from or in connection with

Landlord's failure to perform its obligations, including the payment of reasonable attorneys'

fees, court costs and disbursements.

105. Landlord is thus liable for the payment of the reasonable attorneys' fees, costs and

expenses incurred by Tenants due to, among other breaches, Landlord's delivery of incorrect tax

and additional rent statements, their attempt to withdraw their Notice of Termination of Lease

and to avoid payment of the Termination Fee, their failure to repair and maintain the Building's

systems, and their failure to comply with all their obligations as Landlord pursuant to the Lease,

as set forth herein, all in an amount to be determined at trial, but in no event less than

$50,000.00.

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WHEREFORE, Tenants request that judgment be entered against Landlord:

(a) On the first cause of action, Tenants are entitled to a declaration that (a) the
Notice of Termination of Lease dated March 5, 2014 remains in full force and effect; (b)
Landlord must pay Tenants nine (9) times the monthly Base Rent, as set forth in Article
61(C) of the Lease upon Tenants' vacatur of the Premises on September 10, 2014, in
accordance with Article 22 of the Lease; (c) the Withdrawal of Notice of Termination of
Lease dated March 26, 2014 is defective, null and void; and (d) Tenants are not in default
of their obligations under the Lease;

(b) On the second cause of action, a money judgment against Landlord and in favor
of Tenants in an amount to be determined at trial but in no event less than $300,000.00,
plus interest;

(c) On the third cause of action, a money judgment against Landlord and in favor of
Tenants in an amount to be determined at trial but in no event less than $300,000, plus
interest;

(d) On the fourth cause of action, Tenants' attorneys' fees, costs and expenses in an
amount to be determined at trial but in no event less than $50,000.00; and

(e) Such other and further relief as this Court deems just and proper.

Dated: New York, New York
May 11, 2014
PRYOR CASHMAN LLP
Attorneys for Plaintiffs'

By:
Eric D. Sherman
Cecilia M. Orlando Stighetti
7 Times Square
New York, New York 10036
(212) 421-4100

19
VERIFICATION

STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )

SCOT BRADLEY GLASBERG, M.D., being duly sworn, deposes and says:

I have read the foregoing First Amended Verified Complaint and know the
contents thereof The same is true to my own knowledge, except as to the matters therein stated
to be alleged upon information and belief, and as to those matters, I believe them to be true.

PATR1C!A A. MATTI
Notary Public, State of New York
No. C1C16103487
Qualified in Queens County
SCOT BRADLEY ,ASBERG, M.D.
Commission Expires Dec. 29, 201&

worn to before me this
day of May, 2014

Not Public
VERIFICATION

STATE OF NEW YORK
) ss.:
COUNTY OF NEW YORK)

DAVID L ABRAMSON, M.D., being duly sworn, deposes and says:

I have read the foregoing First Amended Verified Complaint and know the
contents thereof. The same is true to my own knowledge, except as to the matters therein stated
to be alleged upon information and belief, and as to those matters, I believe them to be true.

PATRICIA A. CINATTI
Notary Public, State of New York
No. C1CI6103487
Qualified in Queens County DAVE) L. ABRAMSON, M.D.
Commission Expires Dec. 29, 201t,

SW M to before me this
of May, 2014
1,

Case Info

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Manuel J. Mendez Track Judge’s New Case

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Document Filed Date

May 16, 2014

Case Filing Date

February 13, 2014

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Complaint,Petition: David L. Abramson M.D., Scot B. Glasberg M.D. v. 74th Llc, Ben Heller

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