New York Observer: Power Broker, “He has built a remarkable law firm. I don’t think everyone understands that what he has done is a huge accomplishment”
By Daniel Geiger
February 21, 2012
Adam Leitman Bailey strode into the lobby of his lower Manhattan law firm dressed in a dark blue suit and blue shirt, his extended cuffs all but dangling from his jacket. No sartorial misstep, Mr. Bailey would explain. The cuffs protruded noticeably beyond his jacket sleeves for a reason.
“It’s essential,” said Mr. Bailey, the attorney who last year garnered national attention as counselor for the Ground Zero mosque developer Sharif El-Gamal. “I’ve studied everything about the court room. It’s a subconscious thing, but this shows a jury you have nothing to hide.”
As if to prove his point, Mr. Bailey awkwardly tucked the sleeve of his shirt back inside his jacket. “See?” said the attorney, who takes the nuances of his dress code so seriously that every new associate at the law firm shops for their first suit with him so that he can personally give them a lesson in proper courtroom attire. “You’re hiding something.”
As the nameplate on Mr. Bailey’s firm suggests, this is Adam Leitman Bailey’s world.
Unlike most law firms, which reward their top performers and veteran executives with equity, there’s only one partner at the eponymous Adam Leitman Bailey PC. Yet a quick tour through Mr. Bailey’s firm yields droves of young, attractive associates who offer almost cultlike praise of the company and its culture.
More impressive, however, is the ring of senior lawyers sitting in the windowed offices along the periphery. Despite having a hairline that retreated rapidly through his 30s, Mr. Bailey is a youthful-looking 41, an image enhanced by the energy and force of his personality. Yet he has been able to recruit veteran attorneys, some decades older than himself, to handle important portions of the firm’s growing caseload.
“He has built a remarkable law firm. I don’t think everyone understands that what he has done is a huge accomplishment,” said Joshua Stein, a retired partner at the large law firm Latham & Watkins who has since started his own firm.
In the span of about a decade, Mr. Bailey has not only grown Adam Leitman Bailey PC into a bustling real estate law practice, expanding from just himself in 2000 to more than 40 employees today, he has personally become one of the industry’s most visible litigators as well. And not just in the city. Last year, Mr. Bailey represented Mr. El-Gamal, the mosque developer, in lawsuits against the controversial project. He did the work pro-bono, he said, because of his passion for the constitutional right of religious freedom.
Yet when the mosque riled sentiments beyond the city and popped up in national headlines, Mr. Bailey expertly rode the wave of attention. Appearing on The O’Reilly Factor, Mr. Bailey showed up ready to scrap, quickly pushing the show’s host Bill O’Reilly into a debate on his opposition of the project. Mr. El-Gamal, meanwhile, has slipped into serious arrears on his rental payments at the site and is in danger of being evicted. In hindsight, for all the storm of debate the mosque story generated and all the airtime it earned Mr. Bailey, the project now seems like little more than a pipe dream.
The episode wasn’t Mr. Bailey’s only foray onto the national media scene. Last year he released The Uncommon Deal, a how-to book for homebuyers looking for a bargain. Since it appeared on The New York Times best-seller list, he has been a more frequent guest on the cable news-show circuit as a real estate expert and pundit.
To his critics, Mr. Bailey is a marketer and self-promoter more than a legal virtuoso.
“He is amazing, first of all, how he gets all of this publicity, it’s just incredible,” said Stuart Saft, a partner at the large firm Dewey Laboeuf and the global chair of its real estate department who has faced off against Mr. Bailey in the courtroom. “Watching him go, he’s nonstop. There’s no one else like him in our field.”
And yet, there is no doubt that Mr. Bailey has carved out an impressive string of victories.
Mr. Bailey began his rise to prominence starting in the early 2000s, representing homebuyers who had purchased units in defective condominium buildings. It was a fertile area for cases. The real estate market in the city was heading upward and more developers were getting into the business of building apartments or converting existing structures into housing. Not every project was administered by skilled hands. Bad buildings were erected and tenants were left with uncomfortable problems like leaky roofs, cracked facades and shoddy plumbing. A natural showman, Mr. Bailey knew how to milk these defects for maximum courtroom drama. And when a case bogged down, unlike most attorneys, Mr. Bailey usually knew all the right levers to pull.
“There’s three prongs in the law these days,” Mr. Stein said. “You have your discovery period, the litigation itself, and increasingly the media is a tool, too. Mr. Bailey is obviously an expert with it.”
In 2004, at the 27-story building 90 Washington Street, a condo developed by landlord Joe Moinian where tenants alleged faulty work, Mr. Bailey said he brought the conditions to the attention of state officials, who had allowed the project to use low-cost Liberty Bond financing.
“The problems were immediately fixed,” Mr. Bailey said, declining to discuss specifics because of confidentiality documents he signed in the settlement. Mr. Moinian didn’t respond to a request for comment by press time.
Mr. Bailey’s biggest legal home runs have come more recently. When the real estate market collapsed in 2008, it left scores of condo buyers with deposits on properties that were suddenly worth much less than the amount they had negotiated to pay. Enterprising lawyers may have been eager to tap into this suddenly captive pool of clients, but they would need a legal mechanism to wield any leverage. It was Mr. Bailey who shot to the forefront of these disputes using an obscure federal law called the Interstate Land Sales Full Disclosure Act (ILSA), which Congress passed in 1968. Mr. Bailey wasn’t the first lawyer to employ ILSA, but he was the first with the bombast and vision to employ it in major cases.
Beginning with the Brompton, a high-end condo built by the real estate development company Related, Mr. Bailey showed in court that the company, which had refused to negotiate with buyers who had contracts, had failed to notarize ILSA documents, a seemingly minute oversight. The decision sent shock waves through the residential real estate industry. Buyers could overturn contracts even for developers who had made seemingly insignificant ILSA filing errors. By then, only two buyers in contract at the Brompton were left to benefit from the decision, Vasilis Bacolitsas and Sofia Nikolaidou, two wealthy individuals with the wherewithal to pay Mr. Bailey’s retainer fee until the end. But as the case had progressed and the perception of its argument as a mere long shot began to shift, Mr. Bailey said he was able to negotiate settlements that allowed buyers to recoup increasingly generous portions of their deposit payments or negotiate discounts to the purchase price of their units. Related, of course, disputes this. Joanna Rose, a spokeswoman for the company, said that no bargains or refunds were offered. Because the settlement agreements are confidential, it’s impossible to tell with objective certainty what the terms of all the deals were.
Regardless, with that decision in hand, Mr. Bailey moved onto other properties, repping buyers at the Trump Soho, a large condo-hotel, and Sky View Parc, a condo project in Flushing, Queens.
At Sky View Parc, Mr. Bailey got back 75 percent of buyers’ down payments. John Desiderio, one of Mr. Bailey’s most senior attorneys, quarterbacked a successful litigation with Mr. Bailey at Trump Soho, utilizing components of the ILSA law.
Mr. Bailey’s clients won back 90 percent of their down payments in November, another victory for the firm.
Spokespeople for The Trump Organization and Bayrock did not immediately return calls for comment.
Ironically, the Brompton decision that affirmed ILSA is currently being re-evaluated in an appeals court.
It’s possible that next month, a judge might overturn the whole ruling. To Mr. Bailey, the outcome doesn’t matter. A quick-moving opportunist, he used ILSA while it worked, never expecting it to be an enduring tool he could utilize in future suits.
“ILSA is over,” Mr. Bailey said. “It was something that was good for that moment in time. Any developer who builds going forward would obviously abide by the regulations now so it’s no longer a loophole.”
The sunset of ILSA cases and faulty condo suits brings up the question of what’s next for Mr. Bailey.
Recently divorced, he is back on the dating scene and said he wants to have children, though there is some part of him that also seems conflicted about balancing familial responsibilities with professional ambitions.
“I was destined to run this company,” he said.
Though he has won fame for representing tenants and buyers, the depiction of Mr. Bailey as a nemesis to landlords infuriates him. Mr. Bailey said that his firm is increasingly doing business with large owners, lenders and corporate clients. According to Mr. Bailey, who said that much of his career has been dedicated to “defending underdogs,” his firm now handles foreclosures, fraud and mortgage work for a long list of major investment firms and banks in the city, though he said he couldn’t identify the clients by name.
“We’re doing work with Fortune 500 companies, with Fortune 10 companies,” Mr. Bailey said. “You just never hear about it.”