On October 28, 2021, the United States Court of Appeals for the Second Circuit ruled on a challenge to The Commercial Tenant Harassment Law and The Guaranty Law, two laws that were passed by the New York City Council at the height of the COVID-19 pandemic to protect small business tenants. The Harassment Law expanded the definition of unlawful harassment by a landlord to include threats against a residential or commercial tenant based on their COVID-19 status. The Guaranty Law bars landlords from enforcing personal guaranty provisions in certain commercial leases for the period of time between March 20, 2020 and June 30, 2021. In its ruling, the Court of Appeals upheld the Commercial Tenant Harassment Law and remanded the Guaranty Law for further factual development by the District Court. Click here to read the full Court decision (PDF) and Dissent (PDF).
The VOLS Microenterprise Project has played a pivotal role in representing and advocating on behalf of NYC’s small business owners throughout the pandemic, many of whom are directly impacted by the Commercial Tenant Harassment Law and the Guaranty Law. Considering the Project’s leadership role and legal expertise within the NYC small business community, VOLS submitted an amicus brief in support of the laws in August 2020 at the District Court level. Our brief was cited by the Hon. Ronnie Abrams, United States District Judge for the Southern District of New York, when the Court dismissed the lawsuit that threatened these protections. When the Plaintiffs appealed the District Court decision, VOLS co-counseled with pro bono partners Michael Harris and Jonathan Herstoff of Haug Partners LLP, submitting an additional amicus brief imploring the appellate court to affirm Judge Abrams’ decision.
VOLS co-counsel Michael Harris and Jonathan Herstoff at Haug Partners said of the opinion: “We are pleased that the Court of Appeals upheld the Commercial Tenant Harassment Law, which provides commercial tenants with important protections against harassment based on their status as having been impacted by the COVID-19 pandemic. New York City’s small business owners were some of the hardest hit by the pandemic, and this law was properly designed to ensure that in their zeal to enforce commercial leases, commercial landlords do not overstep the bounds of reasonable and lawful conduct. With respect to the Guaranty Law, we believe that further factual development in the district court will reveal that the Guaranty Law is both reasonable and appropriate to mitigate the economic emergency inflicted upon small business owners by the pandemic.”
Small business owners in NYC who are unable to access the legal support they need due to low household income or underserved socio-economic background should please contact the VOLS Microenterprise Project at microenterprise@volsprobono.org.