1165 Broadway Corp. v. Dayana of N.Y. Sportswear, Inc.

Police officers executed search warrants for different rooms located at 1165 Broadway in New York City and recovered counterfeit goods in each premises. The commercial landlord, 1165 Broadway Corporation (Broadway) (plaintiff), leased the rooms to Dayana of N.Y. Sportswear, Inc. (Dayana) (defendant), manufacturers and sellers of apparel and sportswear. Broadway commenced summary holdover proceedings against Dayana at the request of the New York county district attorney’s office. Broadway claimed that Dayana was using the leased premises for the manufacture of counterfeit trademark clothing in violation of state penal law. Broadway argued that Dayana’s possession for the sale of counterfeit trademark items was an illegal trade, manufacture, or business that voided the lease under New York Real Property Law § 231(1) and entitled Broadway to immediate possession in a summary proceeding brought under New York RPAPL 715(1). Broadway sought possession of the commercial premises in the summary proceeding. Dayana moved to dismiss the summary proceeding on the grounds that the state legislature did not intend for these laws to be used to prohibit the illegal manufacture and sale of counterfeit trademark goods. Dayana argued that these statutes applied only if the commercial premises were being used to promote moral wrongs dangerous to the other tenants in the building or in the neighborhood.