Real estate lawyer alleges former partner’s exit caused firm to collapse

Alvin Schein’s law firm was a preeminent leader in the more arcane parts of New York real estate law.

Seiden & Schein worked with some of the city’s largest developers on tax issues, zoning and inclusionary air rights to help jigsaw together new towers across New York. 

But Schein said his firm fell apart after his former partner and once-trusted mentee, David Shamshovich, left with a group of Seiden & Schein’s lawyers and clients for Belkin Burden Goldman. The result made it impossible for Seiden & Schein, the firm Schein founded in 1996, to stay in business.

“He killed the firm,” said Schein in an interview. 

Schein’s lawyer, Adam Leitman Bailey, recently filed a lawsuit in New York County Supreme Court alleging Shamshovich engaged in an “intentional, willful, and malicious scheme to drive Seiden & Schein into financial ruin.” The complaint further alleges Shamshovich stole confidential information from his former law firm.

A lawyer for Shamshovich denied Schein’s allegations in an emailed response. He said the attorney left Seiden & Schein for better professional opportunities.

“He looks forward to vigorously defending himself in court and, through the litigation process, exposing the plaintiffs’ falsehoods that are designed to intimidate and besmirch,” said Preston Ricardo of Vedder Price. “More important, Mr. Shamshovich is proud and honored that so many prominent developers have chosen to continue working with him — as well as his four colleagues who also left the former firm — to help them navigate New York City’s complex tax and zoning incentive programs for real estate housing projects.”

News of Shamshovich’s departure for Belkin and the subsequent lawsuit by Schein are making the rounds in New York’s close-knit real estate legal community. The news was first reported in Law360. 

Schein has since joined Adler & Stachenfeld, where he will co-chair the firm’s NYC real estate tax and zoning incentives practice group with YuhTyng Patka. 

From mentee to enemy

Schein hired Shamshovich as an associate attorney in 2016. At the time, Shamshovich had no knowledge of the firm’s key areas of law, but Schein mentored him and trained him in the firm’s inclusionary housing practice, according to the lawsuit.

Schein said people often assumed Shamshovich was a son-in-law or nephew. 

“I took care of him and gave him a lot of independence,” said Schein.

By November 2023, as one of Seiden & Schein’s founding partners contemplated retirement, a succession agreement was reached. Shamshovich and two other associates became shareholders in the firm. Shamshovich was not required to contribute any money to the firm and was expected to remain at the firm on a long-term basis, according to the lawsuit 

But, according to the suit, Shamshovich was already allegedly embarking on a scheme to breach his fiduciary duties to Schein and the firm.  

Around this time, Schein alleges Shamshovich promoted his own interests instead of the firm’s. 

One example, the lawsuit notes, is that Shamshovich started a podcast, which the firm financed. But Shein alleges the podcast, “Shaping the NYC Skyline,” was a vehicle for Shamshovich to promote himself. This resulted in a heated argument between Shamshovich and Shein, in which Shamshovich finally agreed to mention the firm on the podcast’s download page.

Schein alleges that Shamshovich verbally abused other attorneys while at the same time convincing another shareholder to join his new law firm. He also claims Shamshovich began communicating with Schein’s most important clients without including Schein in these conversations. 

In late February, Shamshovich submitted his letter of resignation. But prior to his departure, Schein accuses Shamshovich of soliciting and urging the firm’s clients to transfer their business to Shamshovich’s new law firm. The lawsuit alleges Shamshovich took proprietary information from the firm, including the client and attorney information from the firm’s secure files. 

Shamshovich “had few, if any, clients of his own and knew that the only way he could succeed as a partner in another firm was to take firm clients with him,” according to the lawsuit.

On one of his last days, Shamshovich’s departing words to Schein were “see you in the next life.” Shortly after, Shamshovich left Seiden & Schein. Four of the firm’s lawyers joined him at Belkin.

Seiden & Schein was soon rendered insolvent and forced to dissolve, according to the lawsuit.