As previously reported, 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”), 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.
In another significant legal victory, BBG secured yet another favorable decision that adopts the holding of Melendez and finds the Guaranty Bill unconstitutional. This ultimately resulted in our client being granted summary judgment in excess of $875k against the guarantor. BBG attorney, Brian Bendy, worked on the case.
This is significant because despite the Federal Court’s ruling in the Melendez Case, it is still not apparent whether New York State courts will heed the ruling, which is regarded as compelling authority.
A copy of the full decision can be found here.
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 your BBG attorney of record or contact us.