In Re: Rock 51 LLC
- Subramanian
- 1:25-cv-03027
- U.S. District Court · Southern District of New York
- 4
In Rock 51 v. Pref 7, Judge Subramanian denied Rock 51’s request to pause its appeal, finding its lease-notice argument weak.
Rock 51 LLC and Pref 7 West 51st Street LLC, the parties to the lease dispute and the motion to stay pending appeal.
What happened
Rock 51 LLC appealed and asked the court to pause the proceedings while the appeal continued. In Rock 51 LLC v. Pref 7 West 51st Street LLC, the dispute involved whether a notice about unpaid rent adequately warned Rock 51 that its lease could be terminated.
Rock 51 argued that the notice did not clearly connect its failure to pay with possible lease termination. The court disagreed, pointing to the notice’s references to the lease’s default provisions, the deadline to cure, and Pref 7’s right to use its remedies under the lease.
Judge Arun Subramanian denied Rock 51’s motion to stay pending appeal. He concluded that Rock 51 had not shown a strong likelihood of success or irreparable harm, while Pref 7 could be harmed by a stay.
The detailed version
- In Re: Rock 51 LLC · No. 1:25-cv-03027
- Subramanian
- June 23, 2025
Background
Rock 51 LLC, the appellant, asked the district court to stay, or pause, the matter while its appeal proceeded. The court reviewed the record, the parties’ submissions, the Bankruptcy Court’s orders, and the parties’ arguments at a June 20, 2025 hearing. The Bankruptcy Court had previously denied Rock 51’s request for a stay.
Rock 51’s motion focused on one argument from its underlying appeal: that Pref 7 West 51st Street LLC’s notice of default did not adequately warn Rock 51 that Pref 7 could terminate the lease if Rock 51 failed to cure its payment default.
Legal standard
The court applied the Second Circuit’s four-factor test for a stay pending appeal: whether the applicant is likely to succeed on the merits, whether it will suffer irreparable harm without a stay, whether a stay would substantially harm other interested parties, and where the public interest lies.
Court’s reasoning
The court agreed with the Bankruptcy Court that Rock 51 had not shown a strong likelihood of success on appeal. It also found that Rock 51 had not shown irreparable harm because Rock 51 retained the right to seek damages for an allegedly wrongful lease termination. The court further found that Pref 7 would be harmed by a stay because Rock 51 was unlikely to be able to pay damages that Pref 7 incurred while the appeal was pending.
The court separately addressed the strength of Rock 51’s lease-notice argument. The notice cited Section 20.1(A) of the lease, identified the payment default, gave Rock 51 a cure deadline of July 29, 2024, and stated that Pref 7 could exercise its rights and remedies under the lease and applicable law if Rock 51 did not cure. The court explained that Section 20.1(A) defined an uncured payment default as an “Event of Default,” while Section 20.2(A) identified termination as a remedy for that event. In the court’s view, these provisions sufficiently connected the default to the possibility of termination.
The court relied on decisions holding that, in a commercial setting, a default notice is sufficient when it refers to the lease’s termination provision or summarizes its terms. It rejected Rock 51’s argument that the notice needed to use more explicit language tying the demand to the lease’s forfeiture provisions.
Disposition
The court denied Rock 51’s motion to stay pending appeal. The Clerk of Court was directed to terminate the motion at Dkt. 11.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.