Triple Five has replaced its director of business development and point person on the $40 million sale of 1,643 acres at the Enterprise Park at Calverton, according to Riverhead Supervisor Laura Jens-Smith, who said she requested the change in the wake of a report by RiverheadLocal revealing that Stuart Bienenstock was convicted in 2016 in a New Jersey court of forging documents in a real estate transaction.
“After this ruling came to light, it would have been difficult for the town to work with Mr. Bienenstock,” Ms. Jens-Smith said in a release. “I communicated to Triple Five that this would not be acceptable and, as a show of good faith to Riverhead, they have agreed to replace him on this project.”
Four of the five Town Board members said in interviews last week that the disclosure would not affect the proposed sale to Calverton Aviation and Technology — the joint venture between Triple Five and Luminati Aerospace — because Mr. Bienenstock was not a principal in that company. Councilman Jim Wooten could not be reached for comment.
Officials said they were never made aware of the ruling against Mr. Bienenstock by Triple Five or CAT.
“Riverhead is placing great faith in Triple Five to develop one of the town’s most precious resources and to be a good neighbor,” Ms. Jens-Smith said in a release. “In light of this, it was necessary for Triple Five to replace Mr. Bienenstock.”
She said “residents need to be able to trust through handing this sale, and through this gesture, it seems they understand.”
Mr. Bienenstock is an employee, but not an owner, of Triple Five, which owns 75 percent of CAT. However, he was the point person on the company’s dealings with the town regarding EPCAL. Last year, he also guided Triple Five’s purchase of 105 acres at the former Dowling College campus in Brookhaven for $14 million.
Ms. Jens-Smith said Triple Five director of development Amy Herbold will replace Mr. Bienenstock on the EPCAL project.
In January, a New Jersey appeals court upheld a lower court’s $1.3 million judgment against a group including Mr. Bienenstock based on claims of fraud and breach of covenant.
Mr. Bienenstock was not employed by Triple Five at that time, according to his LinkedIn profile.
The lawsuit pitted plaintiffs Chicago Title Insurance and the company it represented, Golden Union, LLC, against defendants Union Avenue Holding LLC, Ariel Gantz, Mr. Bienenstock and Judah Bloch.
A lower court found the defendants guilty on July 14, 2016, and only Mr. Bloch appealed that ruling.
On Jan. 9, 2019, the Appellate Division of the Superior Court of New Jersey issued a ruling upholding the lower court decision. That ruling was picked up by the media in late February because Mr. Bienenstock’s name remained on the case, even though he did not seek an appeal.
The lawsuit involved Union Avenue Holding’s sale of an apartment building to Golden Union. The sale was based on the condition that all liens on the property be satisfied prior to or at closing.
Two companies, West 58th Street, LLC and TSR Group LLC, held an outstanding mortgage on the property, unbeknownst to the buyer, which then took legal action.
The appellate ruling also says that in 2012, Mr. Bienenstock provided an executed discharge for the West 58th Street mortgage and a termination of the TSR assignment of rents.
But four months after the closing, Ronald Herbst, the attorney for West 58th Street, claimed the executed discharge of the mortgage was forged.
The lower court judge, Stephanie Mitterhoff, wrote that while Mr. Bienenstock denied bringing the documents to court or even seeing them until after the closing, he admitted that the handwriting on the discharge of the assignment of rents looked very similar to his.
The judge found Mr. Bienenstock’s “denial that he brought the [forged] documents to the closing” was undermined by a Golden Union official’s testimony that Mr. Bienenstock did deliver the discharges at closing.
The judge also found it “highly likely that Bienenstock forged the document himself, based on his own admission that some of the handwriting on the discharge looked remarkably similar to his own.”
She later wrote, “Regardless of who forged the document, the court finds that both Bloch and Bienenstock knew that to induce the buyer to close, the discharges had to be executed and presented to the buyer at closing.”
The appeals court wrote that “Judge Mitterhoff’s factual findings are well-supported by the competent evidence in the record and her interpretation and application of the law are unassailable. Thus, we find no basis on which to intervene.”
Mr. Bienenstock could not be reached for comment as his voicemail was full.
Photo caption: Nader Ghermezian (left) and Stuart Bienenstock of CAT at an earlier qualified and eligible sponsor hearing before the Riverhead Town Board. (Credit: Tim Gannon, file)