Chelsea Hotel Still Making News – in Court

MANHATTAN (CN) - The company that bought New York City's storied Chelsea Hotel in 2011 claims the seller defrauded it by claiming that 22 pieces of art and photos on its walls were part of the deal.

Chelsea Dynasty LLC sued Chelsea 23rd St. Corp. and Stanley Bard in New York County Supreme Court.

A designated historical landmark, the lower Manhattan hotel provided lodging for Mark Twain, Dylan Thomas, Arthur Miller, and a host of more modern artists.

Leonard Cohen wrote a song about his tryst with Janis Joplin there, called "Chelsea Hotel No. 2." The girlfriend of punk rocker Sid Vicious was found stabbed to death in Room 100, which the hotel later divided into two units.

In its 12-page complaint, Chelsea Dynasty claims it paid $78.5 million for the property because it was led to believe the art, worth more than $1 million, came with it.

However, "After plaintiff's purchase of the Chelsea Hotel, a claim was asserted against plaintiff by Ms. Colleen Weinstein, the widow of Arthur Alan Weinstein, asserting that the Weinstein artwork that was on display in the Chelsea Hotel belonged to her. Ms. Weinstein also claimed that some of the artwork had been damaged. She demanded the return of the artwork and damages," the complaint states.

"After Ms. Weinstein submitted her claim, and in direct contradiction to his and Chelsea 23rd's prior representations to plaintiff, Bard admitted in writing that the Chelsea Hotel had never owned the Weinstein artwork."

Weinstein's widow filed a lawsuit in Manhattan Surrogate's Court demanding the return of 22 pieces of her husband's works of art, which she valued at $500,000.

On Aug. 15, the court ordered the hotel to give the widow her all of husband's art.

"Among those pieces of artwork is the painting 'Dutch Masters' by Larry Rivers," which was valued at $500,000 by itself, according to the complaint.

"The Larry Rivers foundation, as successor to the rights of the Estate of Larry Rivers, has claimed ownership of the painting and represented that the painting had been lent to the Chelsea Hotel for display."

Artist Philip Taafe demanded the return of his work, and David Remfrey removed his work "Bunny" after the new owners assumed control of the property, the complaint states.

None of the artists or their representatives is a party to the complaint.

The prior owners also exaggerated the monthly rents they collected, and falsely claimed that a closet belonging to one tenant was a rentable unit, according to the complaint.

"[A]fter plaintiffs' purchase of the Chelsea Hotel, a tenant at the hotel, [non-party] Mr. George Chemche, made plaintiff aware that a closet on the first floor of the premises was actually part of the apartment he rented and thus could not be leased out separately," the complaint states.

Chelsea Dynasty demands $2.1 million in compensatory damages and $2 million in punitive damages.

It is represented by Joseph Zelmanovitz with Stahl & Zelmanovitz.

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