The jury found Mr. Gundlach and three co-defendants liable for breaching their fiduciary duty to Trust Company, known as TCW, not their fiduciary duty to investors.
"This is a very powerful provision," he said, explaining that without it a new owner could potentially avoid responsibility for future damages caused by improvements or could hold the co-op liable for disturbing improvements in order to gain access to pipes inside walls.
"The purpose of this action is to hold Adidas America … and its criminal co-conspirators liable for the harm they have wrought on the life and career of Brian Bowen II," the complaint said.
Even though the work being done is usually under the supervision of the shareholder or his contractor, and not the co-op board, courts often find co-op corporations liable for these injuries.
For example, Mr. Siegler said, many management contracts contain "indemnification clauses" that could make the co-op ultimately liable for the negligence of the managing agent.
Supermarket company Kroger Co was held liable for the other 20%.
If the proprietary lease provides that the co-op is not liable for deliveries, Mr. Brucker said, the letter writer would probably have no basis for seeking reimbursement.
In 1999, the co-op was found liable for racial discrimination and found in violation of the federal Fair Housing Act of 1968 and the state Human Rights Law.
And in such a situation, the holder of the property — in this case, the co-op corporation — is liable for its loss only if there is bad faith or gross negligence.
Government prosecutors say Mr. Siegelman, as a co-guarantor, was personally liable for the debt; his lawyers say that Mr. Siegelman's signature was a formality and that he would never have been expected to personally pay back the loan.
