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BY TERESE LOEB KREUZER | Joey Demane didn’t know that the two orders of shrimp and chips he prepared late last Thursday would be the last meals served at Simply Seafood, a restaurant that had been on Pier 17 since 1995 and in the Seaport since 1982.
He thought that even though Simply Seafood had lost its court case against its landlord, The Howard Hughes Corporation, he might still be able to stay open for the weekend.
But the marshals arrived to evict Simply Seafood early Friday, Nov. 15.
Judge Shlomo Hagler of the New York State Supreme Court ruled that Simply Seafood had deliberately and intentionally misreported its gross sales, a percentage of which was due to the landlord, and had not paid its utility bills for a decade.
John Demane, 69, Joey’s father and the owner of Simply Seafood, denied both allegations but said that he didn’t have the money to appeal. He said that the judge’s decision was “unexpected. We thought we had a good chance.”
Demane said that when he first took space on the pier, his lawyers told him to pay use and occupancy charges, which he paid. Meanwhile, gas and electricity charges accumulated.
“I didn’t know anything about them,” Demane said, “so I never paid them, and they accumulated to $200,000.”
He said he never received a gas and electric bill from the landlord.
In addition, there was the issue of Simply Seafood’s gross sales. Between 2004 and 2007, Demane said, he sold fish wholesale and retail from his Pier 17 space. He also operated his fast food restaurant from that space.
“I didn’t have to report my retail and wholesale sales to the landlord,” Demane said.
He said that he reported all of his sales to the government and wasn’t trying to hide anything. “In my lease,” Demane said, “it’s spelled right out that the landlord only wanted fast food sales. However, the judge didn’t see it that way.”
A related case in front of Judge Hagler has not yet been settled. Simply Seafood along with several other Pier 17 tenants, sued the landlord for failing in its fiduciary duties at the Pier. The plaintiffs claim that the landlord’s actions damaged their businesses.
“The court’s decision to eject Simply Seafood from Pier 17 and subsequent order speaks for itself,” Hughes Corp. said in statement. “Simply Seafood’s lease was originally terminated in 2005 due to non-payment of rent and other monies owed according to the lease terms. Since that time, it had been an illegal, hold-over tenant. While The Howard Hughes Corporation inherited this situation from the previous landlords, we are pleased that it has been resolved after a long and arduous process.”
Ironically, New York City Comptroller John Liu called Hughes on the carpet for similar infringements. In a press conference on July 25, Liu said that his office had found that Hughes underreported its square footage and “has shortchanged the city on its rent. My office estimates that over the last six years, The Howard Hughes Corporation underpaid the city by about $1.3 million and owes another half a million in interest.”
The city’s Economic Development Corp. declined to pursue the matter.