A Jenner & Block team led by Partner Stephen Ascher won summary judgment in a long-running real estate dispute for client Greystone Special Servicing (f/k/a C-III), who handles defaulted loans in a commercial mortgage-backed securities trust.
One of these loans was to the owner of Clark Tower, also known as the “Empire State Building” of Memphis. The owner/borrower sued Greystone (and the trust) for refusing to consent to a proposed refinancing, claiming that Greystone’s refusal was unreasonable and caused them to default on the loan, which then led to foreclosure and ultimately caused them to lose the $25 million of equity in the property.
In granting summary judgment to our client, a New York State court held that Greystone proved a prior material breach by the borrower, namely, that it failed to maintain rents from the property in a separate “lockbox” account. As a result of this “antecedent breach,” the owner/borrower’s breach of contract claim was dismissed as a matter of law.
Earlier in the case, a New York state appeals court held that a New York court could not enjoin a foreclosure in Tennessee.
The team included Associates Billy Goldstein and Emily Mannheimer. Partners Ali Arain and Jason Hipp and Associate Cayman Mitchell also assisted.
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