Court orders sale of Masaschi home to partially satisfy debt

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A state Supreme Court justice has ordered the sale of the $1.4 million home of Thomas and Kara Masaschi for the purpose of partially satisfying $2.6 million debts owed to a Brighton-based short-term, high-interest lender.

Justice J. Scott Odorisi last week granted a request filed in state Supreme Court in Monroe County by U.S. Income Partners for the appointment of a receiver and sale of the home at 3565 Elmwood Ave. in Brighton.

Proceeds of the sale — minus a statutory $75,000 homestead exemption to the homeowners — would be used to pay outstanding debt on loans from 2014 and 2017 that were personally guaranteed by the Masaschis, who are husband and wife.

U.S. Income Partners filed a petition in September asking the court to grant a sale of the home and find Kara and Thomas Masaschi in contempt for failing “to provide information concerning their finances and real property that could be used to satisfy the judgments.” The contempt order was granted.

The loans in question are just part of nearly $30 million in judgments U.S. Income Partners and its lending affiliates have against Thomas Masaschi and/or business partner Jason Teller, their former development company DHD Ventures, Kara Masaschi and 53 LLCs connected to their real estate development endeavors, court papers show.

Appeals were filed in April and May pertaining to the majority of those judgments. The appellate division has yet to issue a ruling.

There is no appeal on the court-issued judgment regarding the loans from 2014 and 2017. U.S. Income Partners, through attorney Jeremy Schulman, allege in court papers that the homeowners “knew they could not repay their debts as early as 2018 and began trying to protect their real property from their creditors.”

That included the formation of TKLW Holdings, LLC on Aug. 18, 2018, “for the purposes of protecting real property owned by the Masaschi family and protecting the judgment debtors’ assets from outside creditors.”

Court papers say TKLW Holdings has three members: Kara Masaschi, owner of 450 units, and the trusts of their sons, Will and Luke. The trusts own 9,550 units, but Kara Masaschi has sole authority to control a sale, transfer or other transactions, the filing states.

In September of 2018, the property was transferred via “quitclaim deed” to Elmwood LLC for $10. But that did not provide protection from creditors, the rulings says, because U.S. Income Partners was able to show that the Masaschis “constructively own the Elmwood property through Elmwood LLC.”

Justice Odorisi’s ruling goes on to state that “because Elmwood LLC is the alter ego of judgment debtors, its assets are subject to turnover” pursuant to New York State Civil Practice Law and Rules.

US Income Partners provides short-term, high-interest, hard asset-based loans for acquisition, development or rehabilitation of commercial real estate. The firm began loaning Masaschi, Teller, DHD Ventures and/or related LLCs beginning in 2007.

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