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Friday, May 24, 2024 | Back issues
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N.Y. Wheel Developers Grind Gears in Court

MANHATTAN (CN) - A driving force behind a project to build the world's largest Ferris wheel in Staten Island, N.Y., sued Thursday to regain his spot on the project's corporate board.

Plaza Capital Management CEO Meir Laufer says that he got the idea for the New York Wheel when he visited the London Eye in 2008.

Standing at 443 feet tall, the Eye holds the record for the "world's tallest cantilevered observation wheel," but Staten Island developers hope to dwarf that with their own 625-ft. structure.

Laufer's petition in Manhattan Supreme Court comes one day after local trade publication The Real Deal chronicled tumultuous infighting that resulted in Laufer's ouster from New York Wheel LLC, which formed in 2012 with former Bear Stearns executive Richard Marin serving as its president.

Five separate funders and interests, primarily two other corporate entities called Wheel Estate and 57 NYW, made up the LLC.

Laufer, a Hasidic Jew, says his "garb and ethnic appearance" made him the target of discrimination from fellow board members, who also ran power plays to dilute his 33 percent share of the company by nearly a third.

Wheel Estate went to state court on Aug. 5 to have its interest dilutions endorsed by a judge, Laufer lobbed counterclaims through his corporate entity, New York Wheel LLC.

The petition filed Thursday says efforts to drive Laufer off the board escalated during a telephone conference on Jan. 7.

"In the meeting, Marin informed the board that statements made by Laufer as part of his defense in the dilution action, were 'against the best interests' of the company," Laufer's petition states. "Marin claimed that these statements (and those mentioned in the press) have been damaging to the company's fundraising process. Marin did not identify any specific damage to the company attributable to Laufer."

Marin accused Laufer of disclosing "confidential and proprietary business information of the company" and making "false and defamatory statements to the public about the company's business and [board]," according to the 10-page petition.

Laufer insists that he made only "accurate" statements readily available in court documents.

He says that his "removal notice" suspending him from the board is dated on the same day as that telephone conference.

"The removal notice contains conclusory allegations of misconduct, but does not identify any specific acts or conduct that could plausibly establish 'fraud, gross negligence or willful misconduct,'" the petition states.

Laufer says that board also violated their agreement mandating a 30-day notice period before removal.

He is represented by Sari Kolatch of the Manhattan-based firm Cohen Tauber Spievack & Wagner P.C.

Both of the parties to the lawsuit declined to comment.

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