A minority partner’s lawsuit against two Harlem developers has resulted in an arbitration award of more than $1.9 million, according to a release from Lowey Dannenberg Cohen & Hart, which represented the plaintiff.
In a lawsuit, Walter Edwards and Carlton Brown – managing members of both 1400 5th Commercial LLC and Full Spectrum 116th Street Development LLC – were accused of transferring or diverting minority partner Rick Lassiter’s distribution of money to a third party over the past five years. The arbitrator found that Edwards and Brown benefited from the distributions and “stripped” Lassiter of his right to vote. They then diverted $1.8 million in mortgage loan proceeds last year without giving Lassiter his share, the arbitrator said.
The limited liability companies were behind the condo building at 1400 Fifth Avenue and a nearby commercial building at 116th Street. It was not disclosed in the release who represented Edwards and Brown. Edwards is chairman of the Harlem Business Alliance.
The arbitration award is pending before state Supreme Court Justice Barbara Kapnick. — Mark Maurer