The clients were awarded a $3.1 million jury verdict and$ 644,000 in prejudgment interest on their counterclaim.
“The plaintiff, after nine years of litigation, recovered nothing,” said Kreitzer, who chairs Bilzin’s litigation group, and worked with associate Shalia Sakona. “We recovered every dollar that we asked for.”
The dispute pitted joint venture partners 2377 Collins Resort L.P. and West Collins Land Investors L.P. against Miami Springs contractor JVP Drywall & Finish Inc. over work done at a Miami Beach condo hotel.
JVP worked for the joint venture partners’ predecessor, Construction Source L.C., installing drywall and wallboard at 1 Hotel South Beach, formerly Gansevoort Miami Beach Hotel Spa and Residences. That relationship soon deteriorated. Construction Source refused to pay the contractor, claiming JVP Drywall used noncode compliant materials and incorrectly installed bathrooms, causing water leaks and millions in damage. JVP Drywall denied any wrongdoing. Its attorneys—Thomas Jablonski, Bradshaw Lotspeich and Houston Saffold Park—instead filed a notice of lis pendens on Dec. 18, 2008, seeking to foreclose on a mechanic’s lien on the properties at 2301 and 2377 Collins Ave.
Bilzin’s clients—linked to Starwood Capital Group and billionaire developer Richard LeFrak—later purchased the properties in 2012 and stepped in as substitute defendants. Defense attorneys said it seemed to outsiders like a David-versus-Goliath showdown, only with Bilzin’s client cast as the giant.
“From our perspective, you had a very small Hispanic contractor who claimed that not being paid for this work had ruined his company and ruined his life. From a jury perspective, his case had a lot of appeal,” Kreitzer said. “His lawyers tried to position us as the big bad developer that could take advantage of the little guy.”
At trial, Kreitzer, Pallett-Vasquez and Sakona worked to overcome that perception and reframe the narrative as they defended the claim and prosecuted one of their own. Their clients faced steep losses as JVP Drywall’s lien for about $443,000 would have accumulated about $300,000 in interest and attorney fees surpassing $1 million.
Pallett-Vasquez said a key part of the litigation strategy centered on proving to the jury that JVP’s subpar work damaged a prime piece of real estate, forcing the investors to spend millions on repairs. They focused on the details, showing photographs of wallboards improperly fastened to shower pans and holes that permitted water to leak in bathrooms across the property. They pushed forward with a counterclaim against JVP, asserting breach of contract, negligence, violation of the building code and contractual indemnity.
Another hurdle: The investors lost their only eyewitness, who died three months before the start of trial. The expert had performed destructive testing to determine the extent and cause of the water damage for the property’s previous owner, and had given four depositions. He was an architect and engineer who had spent years on the litigation.