The Manhattan Supreme Court has dismissed a lawsuit by 3,000 former Empire State Building stakeholders against Peter and Anthony Malkin.
The ruling, made public Monday and reported by the Associated Press, is a major victory for the father-and-son real estate investors and their Empire State Realty Trust.
The plaintiffs had accused the Malkins of costing them $400 million in potential profits when they took the tower public last October instead of selling it to a private bidder.
Supreme Court Justice O. Peter Sherwood argued that the plaintiffs have no right to sue due to a prior $55 million settlement between the Malkins and stakeholders. “The settlement agreement … contains a covenant not to sue,” he wrote.
Lawyer Stephen Meister, who represents some of the plaintiffs, told AP that he plans to appeal the ruling.
On October 1, 2013, the Empire State Building went public along with 17 other Malkin-controlled properties as Empire State Realty Trust, for $13 a share. The Malkins, who controlled the Empire State Building through their stake in the building’s profitable 114-year lease, had previously won the necessary approval of 80 percent of the investors.
The plaintiffs allege that the Malkins received several private bids for the skyscraper starting in June 2013 of up to $2.3 billion – significantly more than the $ 1.89 billion it ended up fetching through the IPO.