Paul W. Nochumowitz, who has been one of Baltimore's biggest ground rent owners, has agreed to a $1.53 million settlement of a lawsuit that accused him of living lavishly from ground-rent income while claiming he was too poor to compensate former tenants harmed by exposure to lead paint.
The settlement ends a contentious court fight between Nochumowitz and bankruptcy trustee George Liebmann, who accused the ground rent owner in U.S. Bankruptcy Court in Baltimore of concealing his wealth to escape liability for lead paint injuries in rental housing he owned.
"Those concerned feel it is a satisfactory result," Liebmann said Thursday.
Liebmann said most of the money would be divided among more than a dozen families suing Nochumowitz and a business partner, alleging lead paint poisoning of their children during the 1990s. The money will be paid by Nochumowitz, the business partner, and members of their families.
Nochumowitz and his bankruptcy case were highlighted in a 2006 series on ground rent in The Sun. The investigation found that the Nochumowitz family filed hundreds of lawsuits to seize homes whose owners fell behind on rent payments for the land under the homes, often by only a few hundred dollars or less.
In dozens of cases, Nochumowitz family firms won court judgments allowing them to take possession of houses, which they often sold to rehabbers for quick profits during the real estate boom.
Nochumowitz filed for Chapter 7 bankruptcy in October 2005. He claimed in his petition that he earned just $14,000 a year as a bondsman at Big Boyz Bail Bonds on East 25th Street.
That assertion prompted Liebmann to sue Nochumowitz in July 2006, accusing him of a "complicated but fraudulent" asset concealment scheme that included transferring co-ownership of hundreds of ground rents to his wife. Liebmann asserted that Nochumowitz's income from real estate business ventures and ground rents was $50,000 per month.
According to Liebmann, the Nochumowitz family enjoyed a "lavish" lifestyle that included shopping sprees and frequent jaunts to Miami Beach, where Paul and his wife, Amie Sue, owned a $1 million high-rise condominium on Biscayne Bay.
The lawsuit accused Nochumowitz of funneling ground-rent income into his children's custodial accounts and withdrawing $130,000 from them to pay for marble floors and a custom-built entertainment center for the Florida condo. Nochumowitz's lawyers accused Liebmann of "attempted intimidation" of the family to "destroy their reputations."
