Wednesday, April 21, 2010

DDDB's Goldstein settles for $3M (or less after attorney's fees), agrees to leave May 7, will take a step back from anti-AY activism

Also see Goldstein's statement and my analysis.

After hours of negotiations following some brief but charged arguments in Kings County Supreme Court today, Daniel Goldstein, the spokesman for Develop Don't Destroy Brooklyn agreed to accept $3 million from Forest City Ratner--far more than the original low-ball $510,000 offer for his three-bedroom condo--in exchange for leaving by May 7 and reducing his prominent role in the Atlantic Yards opposition.

"The agreement today was in part about the value of my apartment, but more so it was about them, ESDC [Empire State Development Corporation], wanting me out quickly," Goldstein said. "They paid to get me out quickly."

Goldstein and his family are the last remaining occupants of a 31-unit building at 636 Pacific Street, in the heart of the arena block. His neighbors also made deals as a group in 2004, taking a significant profit (thanks to public funds reimbursing Forest City Ratner) and agreeing to a gag order.

"I cannot retain the title of spokesman," said Goldstein, who has long been DDDB's most prominent public face and activist, calling attention to "failure of democracy" with the project. "I can do whatever else I want, and it is stipulated that I can maintain my First Amendment rights."

After the settlement made by Freddy's Bar & Backroom, it's an acknowledgment by a vocal opponent of the inevitability of the arena, if not the project as a whole, and the power of the state in eminent domain cases in New York. The courts had already rejected eminent domain lawsuits and transferred title to the ESDC.

Here's coverage in the Times's City Room blog, the Times, the Daily News, and the Brooklyn Paper. Here's Brownstoner's comment:
We don't in the slightest bit doubt the sincerity with which Goldstein devoted himself to opposing the project nor can we blame him for his final move in the giant poker game given the options, but it's hard not to have some feelings of ambivalence about the way it all ended. After all, it was never supposed to be about the money.
Impact on litigation

In doing so, Goldstein withdrew from existing litigation, which makes it ever less likely that a longshot lawsuit aiming to get the Empire State Development Corporation to issue new eminent domain findings will be successful. A hearing is scheduled for May 12.

(Three plaintiffs in that case remain; two are entities owned by Henry Weinstein, who has not yet settled in the pending condemnation case but has agreed to vacate his property in exchange for an advance payment. He surely would be required to drop other litigation if he settles.)

An appeal in another lawsuit is pending. Supreme Court Justice Marcy Friedman faces motions for reconsideration from a coalition led by Develop Don't Destroy Brooklyn as well as BrooklynSpeaks constituent groups challenging the accuracy of the assumption of a ten-year project buildout.

While Goldstein's settlement does not formally affect that case, it may well be cited as another example of the project's forward motion--examples of which Friedman cited in her ruling in March, writing, "At this late juncture, petitioners’ redress is a matter for the political will."

What about the Development Agreement?

So that makes it less likely that the Development Agreement--which, kept under wraps by the ESDC until late January, sets a 25-year deadline for the project--will receive tough judicial scrutiny. (It is the linchpin of both the new case and request for reconsideration.)

Most of the press has ignored the blatant disconnect between the public profession of a ten-year timetable and the plain fact of the document.

Value to FCR/ESDC

Was the settlement fair? From the perspective of Forest City Ratner, which claimed delay was costing them $6.7 million a month, it was surely worth the cost, given that they are tamping down a vocal opponent and weakening DDDB. (The developer, according to various news reports, sought a full gag order, which Goldstein resisted.)

Beyond that, he agreed to leave faster than had been previously requested and much faster than in most eminent domain cases.

According to a legal motion filed earlier this month, Forest City Ratner claimed it had spent $280 million to buy property for Atlantic yards; unmentioned was that city taxpayers had contributed $131 million.

From the perspective of the ESDC, whose eminent domain counsel was funded by FCR and which worked hand-in-glove with the developer, surely it's worth it.

$3 million man?

Goldstein, who paid about $590,000 for the apartment in 2003, will not take home $3 million. While I don't know the cut for attorney Michael Rikon (and Goldstein wouldn't specify), another eminent domain attorney told me that the fee is typically one-quarter to one-third of the settlement beyond the initial offer.

With an original offer of $510,000, the additional sum is $2,490,000. Thus, the attorney's fee would be either $622,500 or $821,700.

That would leave Goldstein $2.18 million or $2.37 million. That's approximately double what a commensurate apartment would cost.

So, it might be framed this way: beyond the apartment, Goldstein's getting a $1 million-plus in exchange for activism--with impact much beyond Atlantic Yards--over six years that was barely compensated, plus "punitive damages" for "pain and suffering."

Fighting the good fight or selling out

While some online commenters have lauded him for fighting the good fight against a government and developer with enormous resources, some sneer that he was in it for the money. That's hard to believe, given the amount of work he put in.

Some may think he should've held out to the bitter end. He might've gotten far less money in the legal process--and, I'd add, it's hardly comfortable for someone with a wife and child living alone in a building next to a construction site.

Goldstein told Crain's “there was nothing more I could possibly do to fight this project.” Given that he did more than anyone, it's hard to fault his decision, but the settlement, as noted, likely weakens pending litigation that already faced an uphill battle.

Will Goldstein donate any piece of the settlement to DDDB? I asked but didn't get an answer, so we'll see. That may depend on what exactly DDDB becomes, which is unresolved.

If Goldstein continues meaningful work on the issues DDDB and he have highlighted, such as reform of eminent domain and land use processes, he will write his own legacy.

Selected comments from CityRoom

SELL OUT.

I guess it was about money all along, eh?

— Collin Deweger

Sad news, but Dan Goldstein did more than anyone else to try and prevent what will be looked upon in decades to come as one of the most brazen land grabs in recent history.

It’s a double shame that the NY Times didn’t make an effort to expose Ratner for the way in which a stadium we don’t want or need (plus lots and lots of luxury Condos in skyscrapers) was railroaded though by his rich friends in power such as Mayor Bloomberg. Years of construction, with no real chance of low income housing PLUS massive traffic jams for years to come is the real outcome. Anyone been to new London Connecticut lately?

— Dr, Brian

“There’s no end to the criticism and opposition to the project,” he said.

Yeah, right. As with all the sellers, Forest City bought you out, and made you stop talking. Enjoy the Nets broadcasts from your upstate farm.

— ClearWindow

Mr. Goldstein spent seven years of his life fighting for something he believed in. This is more than most people will ever do in their entire lifetimes.

Like many people who fight the good fight, the battle was lost but I think the war will be won. The Atlantic Yards project has come to symbolize the embarrassing abuse of eminent domain in NY. People have started to take notice. Columbia’s plans look unlikely to come to fruition and future projects will face scrutiny.

Mr. Goldstein’s critics quixotically have no problem with developer Bruce Ratner profiting from hundred of millions of dollars in tax money but instead focus on whether Mr. Goldstein’s condo sold for more than it was worth. One can only marvel at their contention that his secret plan was really to spend seven years fighting the mayor, the state and a billionaire developer all to make some money on his condo.

Thank you Daniel for giving so much time and effort to the cause.

— Seth

It’s impossible to know what motivated Mr. Goldstein, but I would not be so quick to portray him as “Goldstein the Gold-digger.”

Sure he profited from this, and why not. If someone was taking my home away as a means to make huge sums of money I would want just compensation.

And Goldstein did push the limits of the debate about the use of eminent domain, the planning — or lack thereof — that surrounds real estate development in NYC, and a host of other important issues that most elected officials avoid examining.

I, for one, am grateful for “Goldstein the Gadfly”, and wish there were more like him.

— DK

t’s awfully easy to criticize from the sidelines….I would venture a guess that most of those who view Goldstein’s decision as selling out never attended a rally, called their representatives in government or did much of anything to actively oppose this awful project. Daniel Goldstein fought this tooth and nail from day one, until every legal option had been exhausted. Saying that he was supposed to hang on in his house until he was dragged out by police and take whatever lowball offer the state gave him is easy when it’s someone else making the last stand. — Owen Hughes

If Goldstein hadn’t agreed to the sale, if I’m reading this correctly, he also wouldn’t have had to submit to the gag order — and would’ve been free to continue railing against the project. In his shoes, I dunno. I probably would have taken the $3 million too. But it definitely smells like hush money.
— stjames

Everyone has a price. I guess they finally found out what his was. — George

For all those attacking Daniel Goldstein, I would predict that you have never stood up for anything or stuck your neck out for anyone. And therefore you seek to find any way you can to prove that all of Mr. Goldstein’s efforts match your own vision of the world where everything is a sham and everyone has a price. Sorry but I don’t care if he squeezed every dollar he could from Ratner — it doesn’t take away everything he did for Brooklyn.
— Jamie

Daniel was most likely going to be forced to sell his place, especially as all the other remaining footprint residents/businesses had cut deals. So, his choice was either take the money now, or wait and see what the state was going to offer when the sheriff came knocking.

As someone who’s worked along side Daniel and others, I don’t have a problem with his buyout agreement. I’m grateful that he and others have fought so long and hard in spite of the threats, insults and bile slung their way. This fight has exposed many in business and government, has created alliances and coalitions, will possibly change legislation and land-use policy. I’m happy for him and his family.

However, it is a sad day for Prospect Heights, Brooklyn, New York City and State. It was always about the money, and I’m not talking about Daniel.

R.I.P. Prospect Heights. It was nice while it lasted.

— tracy collins

Goldstein should be denounced. Many people have donated their time and their funds for the Atlantic Yards cause, under his leadership. Goldstein could have arrived at some publicly-shared concession from the developer, or he could have had the developer donate that money to some other worthy cause. Instead, Goldstein keeps his $2.5 million in profit as a personal gain. He has ridden on the backs of the idealistic to conclude a seven year project of becoming a multimillionaire.
— Disgusted

Many of us will necessarily have mixed feelings about Daniel’s settlement. Even though it comes very near the end of much of the most pertinent litigation it slightly weakens the ongoing and essential fight against the Atlantic Yards mega-monopoly boondoggle. But Daniel deserves congratulations for a seven year fight well fought and ought to be congratulated on getting a sum that is not insultingly small. When I first met Daniel, I told him that there might come a day when he might have to make a decision like this that was right for him and that was O.K. Under the circumstances, he held on quite long enough. If he had held on for a more protracted fight that would have cost him much more I would have supported him in that too but I certainly would not have required it of him. Among other things, I would have loved to see the issue of truly adequate compensation go to the U.S. Supreme Court because it is developer windfall that drives these land grabs and truly adequate and fair compensation for all involved would help take the wind out the sails of a very corrupt process.

Meanwhile, we miss Daniel’s eloquence and level head as an “official” spokesperson for DDDB. Now, if just a few of us follow his example with a modest fraction of his commitment and integrity we can accomplish the jobs that, as of yet, are still ahead of us: the “Atlantic Yards” mega-monopoly needs to be taken away from Forest City Ratner, properly redesigned (along the lines of the UNITY plan) and divvied up among multiple developers who will acquire their parcels the way they should, by competitive bid- Like Battery Park City.

And we need investigations into the corruption that led to the mess that Forest City Ratner has made of Prospect Heights.

Michael D. D. White
Noticing New York
http://noticingnewyork.blogspot.com/


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