Hundreds of residents in Tribeca’s Independence Plaza North apartment complex may be in line to have their rents rolled back, thanks to a state Supreme Court judge’s decision this week that favored the tenants in a five-year legal battle with their landlord.

State Supreme Court Justice Marcy Freidman ruled on Monday that the owner of Independence Plaza North—a 1,331-unit development along Greenwich Street—illegally deregulated rents in the complex six years ago, and that residents living there at the time should have had their rents stabilized.

As a result, more than 170 residents at IPN who have formally claimed to have been overcharged thousands of dollars since 2004 could see their money refunded, and hundreds more could have their monthly rents reduced and stabilized, according to Edmund Rosner, vice president of the IPN Tenant Association.

“We won because we’re right on the law, we're right on the facts, and justice is on our side,” said Rosner.

Seven IPN residents sued landlord Laurence Gluck in 2005 after Rosner discovered the owner was still receiving a J-51 tax abatement associated with the Mitchell-Lama rent stabilization program, more than a year after removing the apartment complex from the program.

The tenants association had claimed that because Gluck continued to receive the tax breaks—which carry a requirement for rent stabilization—the city’s housing laws should have protected the hundreds of tenants whose rents were increased after the complex was removed from Mitchell-Lama.

Gluck, in turn, argued that he was given the tax breaks purely by accident and that stabilization laws should not apply. After he stopped accepting the breaks in 2006 and repaid the money he owed—about $17,900—the city's Department of Housing Preservation and Development retroactively changed the apartment complex's tax record to indicate that the breaks stopped on the same day as the termination of its Mitchell-Lama rent regulations. Gluck's attorneys said that the city's action freed the landlord from any obligation to stabilize rents at IPN. Ultimately, Friedman disagreed.

“The court holds that each plaintiff’s apartment is subject to rent stabilization coverage until the vacancy of that apartment by the tenant, based on the defendants’ failure to comply with statutory and regulatory requirements,” Friedman wrote in her decision. “[Gluck’s] claim that [he] never received J-51 benefits after the exit date is a mere legal fiction.”

Stephen Meister, Gluck’s lead attorney, said in a statement released Tuesday afternoon that he was confident Friedman’s decision would be reversed on appeal.

“The fact remains that both the [state] and the [city] have already concluded that Independence Plaza North is not covered by rent stabilization,” Meister said.

Freidman’s decision overturns an earlier, advisory ruling by the state’s Division of Housing and Community Renewal. Friedman had asked the agency in March to evaluate the legitimacy and net effect of the city’s decision to retroactively erase Gluck’s receipt of the tax breaks. The DHCR said that rent stabilization laws never attached to the apartment complex because, as far as city and state housing authorities’ records were concerned, Gluck never received the tax breaks in the first place. It did not, however, address the legality of the city’s action.

Following news of Judge Friedman’s decision, the mood among residents of IPN was one of cautious jubilation.

“It’s good to see that a judge really looked beyond the agencies’ input and decided to look at the situation and make up her own mind,” tenant association president Diane Lapson told the Trib. “[Gluck] is probably going to appeal, but Judge Friedman wrote a really tight decision. She really understood a lot of the issues we’ve been bringing up.”

At a press conference on the plaza outside IPN on Tuesday, Manhattan Borough President Scott Stringer called the decision a victory not only for IPN tenants, but for residents all over the city struggling to maintain their rent-stabilized apartments.

“This developer did not play by the rules,” Stringer said. “Rent stabilization is a solemn trust, not a relationship of convenience.”

Exactly how Judge Friedman’s ruling, should it survive appeal, affects tenants at IPN will vary based on the circumstances of individual lease agreements. Most long-term tenants could see a roll-back and stabilization of their monthly rent at their 2004 rates. Newer tenants who moved in after the buildings were removed from the Mitchell-Lama program, and have been paying far higher market-rate rents, could have their rents rolled back and stabilized to whatever rate they were paying when they signed their leases. Both groups may also be entitled to rebates on rent already paid.

“It’s a huge relief,” said Susan Greenberg, one of the seven tenants who moved in after 2005 at market rate and are plaintiffs in the suit against Gluck. With her 9-year-old daughter about to enter the 4th grade at nearby P.S. 234, Greenberg said she had been worried that she would be priced out of her apartment at IPN. Friedman’s decision, she said, gave her reason to believe she will not have to relocate.

“It’s been five years that I haven’t known what my future in this neighborhood was going to be,” Greenberg said. “Now I know that I can probably stay here, and raise my daughter here.”

IPN also has a significant population of tenants with Section 8 federal subsidies based on household income. Since the buildings were removed from the Mitchell-Lama program, Section 8 residents have become wary of even small fluctuations in that income, fearful that it could affect their monthly rent.

“We have a lot of families with children of working age that are afraid, they don’t want them to get jobs,” said Marnee May, a resident on Section 8 and a vice president of the tenant association. May said Friedman’s ruling could possibly open the door for Section 8 tenants to leave the program in favor of a stabilized lease without worrying about changes in household income.

“This will really mean they can live a better life,” May said, “and continue living in IPN.”