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Turtle Bay High-Rise Tenants Sue Landlord for Rent Overcharges

By Mary Johnson | November 11, 2011 1:41pm

TURTLE BAY — Several tenants of a Turtle Bay high-rise have banded together to sue their landlord for allegedly overcharging on rents, marking yet another battle for a building plagued by controversy.

Nine residents of 350 E. 52nd St., a 130-unit tower near First Avenue, filed a class-action lawsuit against landlord William Koeppel last month, claiming he has been charging illegally high rents for apartments that should be rent-stabilized.

In the new lawsuit, the tenants at 350 E. 52nd Street claim that Koeppel received J-51 tax benefits for two decades but still charged higher rents on some apartments as they became vacant.

Under the J-51 program, if a landlord performs qualifying work on a building — which could include maintenance work, like roof repairs or waterproofing — the building can apply for a real estate tax abatement, said William Gribben, an attorney representing the tenants in the case.

Residents at 350 E. 52nd Street filed a lawsuit filed on Oct. 17, 2011, alleging overcharges on their rent.
Residents at 350 E. 52nd Street filed a lawsuit filed on Oct. 17, 2011, alleging overcharges on their rent.
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DNAinfo/Mary Johnson

If the building receives those tax benefits, the landlord must treat all the apartments in that building as rent-stabilized, Gribben added.

“Defendants have wrongfully treated and continue to wrongfully treat plaintiffs and the putative class members as market rent tenants, denying them a variety of benefits to which they are legally entitled, as well as charging them amounts in excess of the legal rents for their units,” read the lawsuit, filed Oct. 17 in Manhattan Supreme Court.

The case comes on the heels of the recent ruling in Roberts v. Tishman Speyer, which involved the apartments in the 80-acre Stuyvesant Town and Peter Cooper Village complex. The judge in that case ruled that buildings participating in the J-51 tax abatement program have to maintain rent-stabilized apartments, despite many residents there being charged market rates.

The new suit is just the latest in a series of disputes at the building.

Koeppel, who reportedly pled guilty in 1996 to pressuring tenants and brokers to contribute to the Giuliani campaign, refused last year to sign a new contract with 32BJ, the city's doormen’s union.

Since then, tenants said security problems have increased and that the rotating crew of new doormen are not as vigilant as their union counterparts. One resident even reported that a guest was given a key to an apartment without that resident’s permission, tenants and advocates said.  

In addition to the security problems, residents have publicly complained about problems with rats, mice and maggots in and around the building.

There is even a snarky blog, titled the 350 E. 52nd Street Reality Show, set up to chronicle the building's dramatic tale as it unfolds.

In August, the tenants held a press conference with several elected officials, including State Senator Liz Krueger and Public Advocate Bill de Blasio, calling for an end to the deteriorating conditions.

But Kirk Swanson, one of the tenants involved in the suit, said the recent legal action is unrelated to the ongoing complaints.

"This is a complete, straightforward legal issue," Swanson said, noting that the suit would not have any impact on the doormen's strike or the quality-of-life issues.

“We filed a class-action lawsuit, and we are going to get rent refunds," he added. "We are going to get stabilized leases, and we are going to get reduced rent through the legal process."

Koeppel, however, called the suit “frivolous.”

“It is much to do about nothing," the landlord said. “What they’re asking for in the lawsuit is that the building be re-registered as rent-stabilized. It’s been done.”

Koeppel said that, upon the advice of his attorney, he hired a consultant to come in and help him bring the building’s apartments into compliance with the law.

“Anybody who’s properly entitled to money back from an overcharge will be getting it,” Koeppel added.

But the tenants' attorney, William Gribben, said that the landlord has still not fulfilled his legal requirements.

Gribben said he has also advised tenants not to sign any new leases that Koeppel distributes in the building because they may not be legal.

That means residents like Swanson will continue paying their current rents until the case is resolved.

“[Koeppel is] trying to retroactively register these apartments after breaking the law for all these years,” Swanson said. “This is why we have to take him to court.”