Our office previously circulated an update that the United States District Court for the Southern District of New York in the case of Melendez, et al., v. The City of New York, et al., (the “Melendez Case”) declared that New York City’s Guaranty Bill is unconstitutional and violates the United States Constitution’s Contracts Clause. The Guaranty Bill rendered personal guaranties associated with certain commercial leases unenforceable for the period from March 7, 2020 through June 30, 2021.
Recently our firm obtained a favorable and important decision in the case of Kensington House NY LLC v. Nicholas Emil Accardi (link to decision here) in which a judge in the New York County Supreme Court applied the Melendez Case and held that the Guaranty Bill is unconstitutional. This appears to be the first case from a New York County Supreme Court judge that has held that the Guaranty Bill is unconstitutional. Brian Bendy led the case for BBG.
The decision is important because even in light of the decision by the Federal Court in the Melendez Case, it is still unclear whether New York State courts will follow the Melendez decision, which is considered persuasive authority.
If you wish to discuss how any aspect of this decision may apply to your case(s) or if you had any claims previously barred, contact us.