RFR Holding has filed a lawsuit in New York County Supreme Court against entities led by Claudio Del Vecchio, the Luxottica heir and former Brooks Brothers CEO, seeking damages related to the sale of 346 Madison Avenue. The legal action follows RFR’s claim that it performed significant due diligence on the property, which was then allegedly used to facilitate a sale to another buyer.
According to the lawsuit, Del Vecchio began looking to sell both the Brooks Brothers store at 346 Madison Avenue and an adjacent office building at 11 East 44th Street before the pandemic. The properties were listed for sale in 2021 through JLL.
RFR asserts that after initial struggles to sell the buildings, it entered into an exclusivity and confidentiality agreement with the seller and shared detailed information obtained during its due diligence process. A purchase and sale agreement was reportedly put in place between RFR and the sellers.
However, once RFR’s exclusivity period expired, the company alleges that “the agreement was allegedly ‘duplicated into the name of another buyer and executed.’” While RFR did not specify who this other buyer was, SL Green recently entered into contract for a $160 million acquisition of the property.
The complaint states that confidential data from RFR’s due diligence was uploaded to a third-party site accessible by competitors. This alleged breach allowed SL Green to secure a deal soon after RFR’s exclusivity window closed. RFR described this breach as akin to a “Trojan Horse.”
JLL listing broker David Giancola is accused by RFR of using their interest in order to maximize value from any potential deal; however, Giancola is not named as a defendant in this case.
RFR declined comment on ongoing litigation when contacted by The Promote. Del Vecchio could not be reached for comment by The Real Deal.
It remains uncertain how this lawsuit might impact SL Green’s plans for new office development near Grand Central Terminal. The site may support an 800,000-square-foot project adjacent to 350 Madison Avenue—a property owned by RFR.
