Attorney General James Secures $6.5 Million from One of New York City’s Worst Landlords

NEW YORK – New York Attorney General Letitia James today announced a $6.5 million settlement with Lilmor Management, LLC (Lilmor) and its principal, Morris Lieberman, for repeated and egregious lead paint, mold, and housing maintenance code violations. Lilmor also engaged in deceptive business practices when leasing units by misrepresenting the building’s condition to current and prospective tenants. Lilmor is a property management company that owns or manages at least 49 buildings with over 2,500 rent-stabilized units in Brooklyn and Queens. Lilmor and its agent, Jason Korn, were among the top offenders on the New York City Public Advocate’s “Worst Landlord” list in 2019 and 2020. The settlement was negotiated in partnership with the office of United States Attorney for the Southern District of New York (SDNY) Damian Williams.

As a result of the settlement, Lilmor and Lieberman will pay $6.5 million to the Office of the Attorney General (OAG) and SDNY, including over $2.9 million in restitution that OAG will distribute to impacted tenants. Lilmor must also improve its units to resolve all outstanding condition issues, a process which will be overseen by an independent Housing Specialist chosen by Attorney General James and U.S. Attorney Williams.

“Lilmor Management rented out apartments in hazardous condition to unsuspecting tenants, putting thousands of people in harm’s way,” said Attorney General James. “Tenants in Lilmor’s buildings, including children, were forced to live with leaks, mold, infestations, and elevated levels of lead. I expanded and strengthened the Worst Landlord list when I was Public Advocate specifically to take on bad actors like Lieberman and Lilmor Management. Now, as Attorney General, my office continues to hold these predatory landlords accountable because New York renters deserve better. Morris Lieberman’s days of harming tenants and their families are over.”

The OAG opened an investigation into Lilmor in June 2021 after receiving complaints from tenants and advocates reporting extremely poor conditions and elevated lead levels found in children who lived in Lilmor buildings. Lilmor’s portfolio has had more than 30,000 Housing Maintenance Code violations from the New York City Housing Preservation and Development (HPD), the most serious of which include chronic and recurring water leaks, mold, lead paint, and vermin infestation. All of these hazards pose severe health risks for tenants, especially young children.  

The OAG’s investigation determined that Lilmor violated several provisions of New York City’s Childhood Lead Poisoning Prevention Act. Specifically, Lilmor:

• Repeatedly failed to adequately determine if a child under the age of six lived in any of its apartments;
• Failed to conduct annual inspections in apartments and buildings where it knew a child under the age of six lived; and
• Failed to undertake legally required measures to inspect for and address any lead paint hazards in between tenancies;

Lilmor’s non-compliance resulted in residents’ exposure to lead-based paint hazards, including more than 100 children under the age of six who tested positive for elevated lead levels in their blood. Lilmor also repeatedly and persistently violated local laws related to proper abatement of mold and vermin. The OAG’s investigation found that Lilmor addressed mold and vermin issues only in response to the placement of city and state housing code violations and failed to take any of the legally required proactive and ongoing steps to inspect for or prevent these hazards. Specifically, Lilmor:

• Failed to ask all tenants about mold and pests every year, as required by law;
• Did not annually inspect all apartments for indoor allergen hazards (mice, roaches, rats, and mold);
• Did not document compliance with law that requires that vacant units be thoroughly inspected and properly cleaned before new tenants moved in; and
• Failed to demonstrate that it established an Integrated Pest Management plan, not just to exterminate for pests in a single unit, but to address extermination throughout the buildings.

The majority of Lilmor’s buildings are located in Midwood and Flatbush in Brooklyn and Rockaway and Elmhurst in Queens. Lilmor also has buildings in Inwood, Manhattan and Crown Heights, Gravesend, and Prospect Lefferts Gardens, Brooklyn. HPD has documented over 30,175 Housing Maintenance Code violations across Lilmor’s portfolio, an average of over 500 violations per building. There are currently more than 880 open violations across Lilmor’s entire building portfolio. A small sampling of Lilmor’s portfolio reveals at least 89 mold violations placed between 2016-2021 in just eight buildings. 

In addition to these hazards, OAG found that Lilmor engaged in deceptive business practices by failing to disclose lead paint and other conditions within its buildings and misrepresenting the habitability of its apartments to new tenants and at lease renewals. Lilmor’s concealment of the poor conditions of its buildings misled countless renters choosing to rent Lilmor apartments and in some cases, contributed to serious health consequences for tenants and their young children. 

Lilmor will pay $3.25 million to OAG and $3.25 million to SDNY, for a total of $6.5 million. Of the $3.25 million paid to OAG, 90 percent will be returned to Lilmor tenants impacted by the mismanagement and poor conditions of the buildings. All tenants will receive a notice informing them of the settlement. The remaining 10 percent will go to HPD to cover a portion of the civil penalties that Lilmor incurred for failing to timely and properly remediate violations. In addition, Lilmor must remove or replace lead-based paint from all chewable, friction, and impact surfaces and replace, remove, permanently enclose, or permanently encapsulate all other surfaces where lead-based paint is found throughout its portfolio. These are heightened abatement requirements which exceed local law requirements. 

This work will be overseen by an independent “Housing Specialist,” selected by OAG and SDNY and paid for by Lilmor, who will serve as an independent monitor and project manager for the remediation project with the ability to conduct apartment inspections, and, if necessary, step in, to complete remediation and repair work if not properly done by Lilmor. The Housing Specialist will also act as a liaison for tenant and advocate concerns. Both OAG and SDNY will have oversight over the Housing Specialist. 

Current tenants will be entitled to partial rent abatements while remediation and repair work is being conducted in their units. Any rent increases that occur while repair work is ongoing will only be collectable once the work is complete. 

Lead is a highly toxic metal that can cause serious and irreversible adverse health effects. Children who have been exposed to even very low levels of lead are at risk for neurological and physical problems during critical stages of early development. Lead poisoning in New York City is highest among children of color and children living in high-poverty neighborhoods. Lead paint has been found in approximately 43 percent of all of New York dwellings. The vast majority of older, painted buildings contain some paint with lead high levels. The New York City Childhood Lead Poisoning Prevention Act requires owners of apartments and houses built before 1960 to take critical safety measures to prevent lead poisoning in young tenants.

Attorney General James thanks NYC HPD Commissioner Adolfo Carrion Jr., Deputy Commissioner of Enforcement and Neighborhood Services AnnMarie Santiago, and Assistant Commissioner of Housing Litigation Marti Weithman for their invaluable assistance.

This matter was handled for OAG by Assistant Attorney General Jane Landry-Reyes of the Housing Protection Unit under the supervision of Unit Chief Brent Meltzer. The Housing Protection Unit is part of the Division for Social Justice, which is led by Chief Deputy Attorney General Meghan Faux and overseen by First Deputy Attorney General Jennifer Levy.