Two brothers shared a savings bank, a nephew ran it, a son was installed beside him, and it took the Milsteins ten years and a buyout to stop suing one another.
The Milsteins were very good at owning New York apartment buildings and, for about ten years, conspicuously bad at owning a savings bank together. The bank was Emigrant, and the owners were the families of two brothers, Paul and Seymour Milstein. American Banker, which covered the business closely, described what followed as a discord that ended up pitting the two patriarchs’ families against each other “in a bitter and public feud”.
On one side stood Paul and his sons, Howard and Edward. On the other stood Seymour’s son, Philip, with his sister Constance close by in the family’s property affairs. Cousins, in other words, and cousins are the people you expect to see at weddings, not in a court caption.
1993, and a nephew in the corner office
Philip Milstein was named chief executive of Emigrant Savings Bank in 1993. His uncle Paul was the chairman. For a family business this is a perfectly ordinary arrangement. The older generation keeps the chair, a younger man gets the desk, and everyone agrees to talk about it at dinner rather than in writing.
The agreement did not hold. According to the complaint Paul’s side later filed, Paul soon became “dissatisfied” with his nephew’s performance and installed his own son, Howard, as co-chief executive. Families invent the title co-chief executive for exactly this kind of situation, and it seldom survives one.
There were now two men at the top of the same bank, related by blood and divided by branch. One had been put there by his uncle. The other had been put there by his father. The complaint is one party’s account, and it stayed an allegation, but its outline is the outline of everything that came next.
The late 1990s, after the surgery
The Real Deal, looking back on the family in February 2010, offered a theory of the case. It described Howard as the “strong-willed” head of Milstein Properties and Philip as the “more low-key” of the cousins, and it put the friction down to Howard’s “bombastic personality”. Those are the magazine’s adjectives and they read like the magazine’s adjectives. Nobody describes himself as bombastic.
The turn, in The Real Deal’s telling, came when Paul became less active in the late 1990s after heart surgery. With the patriarch stepping back, Howard tried to assert his dominance, and the result was a run of lawsuits that “ultimately tore the family apart”. The magazine prefaced all this with “the story goes”, which is a reporter’s way of saying the family has a version and the family is not the one telling it.
The same account carries a detail that has travelled well at New York dinner tables ever since. When Howard sold Douglas Elliman, the brokerage, The Real Deal reported that he refused to give his cousin a share of the proceeds. It is a single report, The Real Deal’s alone, and it should be held with the same light grip the magazine used.
What the episode does show is how a family argument changes shape once the oldest man in the room steps out of it. Brothers who built something together tend to have a way of settling things between themselves. Their sons, who inherited the buildings without the shared memory of buying them, often do not.
The end of the 1990s, in court
Then the paperwork arrived in earnest. American Banker reported that the feud had “took an ugly turn” when Emigrant’s chairman, Paul, filed a lawsuit to remove his own nephew as chief executive. Howard and Edward joined their father in the action. In their court papers they argued that Philip was unfit for the job, which was their allegation and never a finding.
In a family company the letter to shareholders and the family newsletter tend to be the same document. Paul used his when, writing to shareholders one March about his nephew, he said he found him “increasingly dictatorial, although at the same time not sure of what he is saying or doing”, as American Banker reported. It is the sort of sentence an uncle might mutter over coffee. Here it went out on letterhead to the people who owned the bank.
Philip did not let the traffic run one way. At one point, American Banker reported, Seymour’s son filed a suit of his own, alleging that Howard and Edward had mismanaged a family-owned insurance company. That was his allegation, as theirs had been theirs. By now each branch had accused the other of running something badly, in a court filing, under its own surname.
The two sides had also arrived at the one thing a feud like this needs to keep going, which is a second front. A dispute over who runs a bank can, in principle, be settled by deciding who runs the bank. Once an insurance company is involved, and the cousins are arguing about the past rather than the next board meeting, it becomes a dispute about the whole estate of grievance.
April 2003, the settlement
On 16 April 2003 the New York Times reported that a wealthy real estate family had settled a decade-long feud. A decade, counted back from that spring, lands almost exactly on 1993 and the nephew’s appointment.
The headline did not need to name the family. Readers of the Times metro pages knew which wealthy real estate family had been feuding.
Settlements of this kind rarely make anybody happy. They make everybody finished, which in a family is often the better outcome, and it allows the two branches to stop meeting each other in lawyers’ waiting rooms and go back to meeting each other at funerals.
December 2003, and Seymour’s estate sells
The settlement had a sequel, and it was written in shares rather than in court papers. In December 2003, American Banker reported, Howard and his father bought the 45 per cent stake in Emigrant held by the estate of Howard’s late uncle, Seymour, and three other investors.
Seymour was by then dead. His estate’s holding in Emigrant went to the nephew whose cousin had once been chief executive there, and to the brother whose lawsuit had tried to remove that cousin. The bank that had been fought over now sat with Paul’s branch.
American Banker, writing about the bank’s new strategy under Howard, called Emigrant a $9.6 billion-asset company, and profitable with it. It was a sizeable thing to have argued over, and a sizeable thing for one branch to walk away with. Whatever the precise terms of the April settlement, the December purchase settled the more practical question of who would be running the bank for the next generation.
2010, the buildings on the other side
Seymour’s children kept the bricks. Philip and his sister Connie, The Real Deal reported in 2010, had founded their own company, Ogden Cap Properties, to manage their share of the family’s holdings. The list of addresses reads like a walking tour of the Milstein years in Manhattan: Normandie Court, Windsor Court, One Lincoln Plaza, Dorchester Towers and the Milford Plaza.
That same February, The Real Deal had the family “back in fray”, this time over a tenant lawsuit concerning 30 Lincoln Plaza. It was a quieter sort of fight, the kind any big residential landlord in Manhattan has with somebody in most years. After the Emigrant decade, a Milstein dispute that involved tenants rather than cousins counted, by the family’s standards, as a calm patch.
The name Milford, incidentally, turns up on both sides of the family’s paperwork. The Milford Plaza sat in Ogden Cap’s portfolio. Milford Management sat under Howard. Families divide the assets more readily than they divide the words.
After Paul
When Paul Milstein died, Columbia Business School’s tribute called him a real estate legend and philanthropist, and listed those he left. There was his wife, Irma, his sons Howard and Edward, his daughters Roslyn Milstein Meyer and Barbara Susan Milstein Zalaznick, his sister Gloria Flanzer, 11 grandchildren and one great-grandchild.
The same tribute described Howard as running Milstein Properties and Milford Management and as chairman of New York Private Bank & Trust. A tribute is not a cap table, but the line reads like a settlement in prose. Paul’s branch had the bank and the management companies. Seymour’s had Ogden Cap and its buildings.
A tribute also tends to leave out the lawsuits, which is what tributes are for. The list of survivors does not say who sat next to whom.
December 2021, Malta
The most public Milstein job of recent years went to Seymour’s side. In December 2021, Jewish Insider reported, President Joe Biden announced the nomination of the philanthropist and businesswoman Constance Milstein as ambassador to Malta. The report described her as the daughter of the New York developer Seymour Milstein, and as the co-founder, with her brother Philip, of Ogden CAP Properties.
It is a neat piece of family geography. Her uncle’s branch kept the bank her brother once ran. Her own branch kept the apartment buildings, and in time she was nominated to a post that has nothing to do with either.
The Milsteins had spent ten years arguing over who should speak for one savings bank. In December 2021 the White House asked one of them to speak for the United States in Malta.
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Cover photograph via Wikimedia Commons.
