Posted April 1st, 2014.
As it appeared on Law360
Law360, New York (April 01, 2014, 6:04 PM ET) — Tenants at Gateway Plaza in New York filed a $100 million class action Tuesday alleging companies in charge of the Battery Park City complex have exposed tenants to frigid temperatures by failing to provide adequate insulation and profited from residents using excess electricity to run heaters.
Members of the class, which numbers nearly 5,000, suffered through sub-55 degree interior temperatures and had to scrape frost from the insides of windows to avoid water damage, according to the complaint.
Despite those conditions, the defendants continued to raise rents — and benefited from the additional electricity needed to power interior heaters, since defendants purchase electricity from Consolidated Edison Inc. and sell it to the tenants, the complaint alleges.
“Gateway is inadequately heated, and tenants endure oppressively cold conditions. Because of this, plaintiff Koetz and class members must suffer freezing cold during the winter months,” the complaint states. “The defendants … have failed to maintain residential units fit for human habitation. … In Battery Park City, [New York’s Real Property Law] is honored more in the breach than in the observance.”
Plaintiff Maureen Koetz, a resident at Gateway Plaza, was vice president of Gateway Plaza Tenants Association until 2012.
Gateway Plaza Management Corp., one of four named defendants in the complaint, says its heating system is up to code and denies the allegation that defendants have benefited from alleged increases in electricity usage.
“All equipment at the property is capable of meeting all code standards for climate comfort. … The property is eminently habitable, and many residents enjoy long tenure at Gateway,” Gateway Plaza Management said in a statement emailed to Law360. “The plaintiff clearly enjoys living at Gateway because she herself renewed her own lease in December 2013. The property ‘owner’ does not benefit in any way from collecting and passing through resident electrical charges. … We will defend this lawsuit vigorously as it is baseless and without merit.”
The property opened in 1986, and some residents have lived there continuously since that time, according to Gateway Plaza’s statement.
Starting monthly rents at Gateway range from $2,350 for a studio to $5,800 for a three-bedroom, according to the apartment complex’s website. The six-building complex comprises more than 1,700 units.
“You have people shivering … and as a result, they can’t really use all the space of their apartment,” Jeremy Heisler, counsel for the plaintiffs, told Law360 in an interview. “Square footage in Manhattan is the most expensive in the country and among the most expensive in the world. We think $100 million, based on the magnitude, is certainly reasonable.”
The named defendants in the suit are Marina Tower Associates LP, Gateway Plaza Management Corp., Battery Park City Authority and The LeFrack Organization, which owns the six buildings at issue in the suit.
Robin Forst, vice president for external relations at Battery Park City Authority, told Law360 Battery Park has no comment, and additional defendants couldn\’t be reached for comment Tuesday.
The New York Legislature passed a landlord tenant law in 1975.
Plaintiffs are represented by Jeremy Heisler, Jenifer Rajkumar and Jennifer Siegel of Sanford Heisler LLP.
Counsel information for the defendants was not immediately available.
The case is Koetz v. Marina Tower Associates LP, index number 651023/2014, in the Supreme Court of the County of New York.
–Editing by Philip Shea.