The Landa lawsuit is a lender action filed in November 2024 by Viola Credit and L Finance in New York State Supreme Court that accused Landa Holdings of defaulting on more than $35 million in loans, resulted in a court-appointed manager taking over 119 single-family rental properties, and left the fractional real estate platform’s app frozen and thousands of retail investors unable to withdraw funds or sell shares.1Index No. 659157/2024, Supreme Court of New York, Commercial Division The case is still open as of April 2026, and no class action by retail investors has been publicly identified.
Who Sued Landa and Why
On November 19, 2024, Viola Credit GL I, L.P. filed suit against Landa Holdings and a group of its Series LLCs in the Commercial Division of the New York State Supreme Court. The complaint targeted two sets of financing agreements: bridge loan refinancing agreements from April 2023, and a broader financing agreement dating to August 2021. The lenders alleged “numerous defaults” on more than $35 million in outstanding debt, including missed interest payments, and said they had notified Landa of defaults three times during 2023 before sending a formal default notice on October 29, 2024.
The complaint went beyond missed payments. It alleged Landa had failed to pay property taxes on some homes (leading to forced sales), neglected maintenance, and failed to collect rents. John Sordillo, later appointed chief restructuring officer, testified that many of the 119 houses in the litigation were “vacant and in a state of disrepair and neglect.” A contractor had placed liens for unpaid work on at least 12 of the properties.
What the Court Ordered
A temporary restraining order issued on November 26, 2024, replaced Landa as manager of the affected Series LLCs and installed Anna Phillips, a restructuring professional, as interim manager. In December 2024, Judge Jennifer Schecter issued a full preliminary injunction ordering Landa to hand over control of all 119 properties, along with their rents and bank accounts, to Phillips.
What followed intensified the fight. According to Sordillo’s sworn testimony, Landa executives drained nearly $750,000 from the properties’ bank accounts over three days in December 2024. The lenders further alleged that Landa instructed tenants to redirect rent payments into newly opened, unauthorized accounts, and that CEO Yishai Cohen tried to sell or refinance properties already subject to the court order.
On January 22, 2025, Judge Schecter threatened the Landa entities with contempt if they did not submit to depositions and stop violating the injunction. By early February, Landa agreed to turn over financial records and accounts. The agreement gave the new management team the right to sell all 119 properties to satisfy the $35 million debt and barred Landa from objecting to those sales. Cohen agreed to sit for a deposition on March 5, 2025.
Landa’s Countersuit and Current Docket
In early March 2025, Landa asked the court for its own restraining order against Viola Credit and L Finance, arguing the independent manager had been “installed unlawfully.” Judge Schecter denied the request and ordered Landa to pay nearly $100,000. Landa then filed a formal countersuit against the lenders.
The case remains open. Motion practice continued through late 2025 and into 2026, with the most recent docket update logged on April 28, 2026. A decision and order on Motion #007 was filed in December 2025, and a January 2026 return date was set for further proceedings. No trial date appears in the docket. In November 2025, attorney Michael S. Gordon informed the court that no replacement counsel had appeared for the defendants, which suggests representation problems on Landa’s side.
What the Lawsuit Means for Investors
Landa let retail users buy fractional shares of individual rental homes for as little as five dollars through a mobile app, with monthly dividends paid from net rental income at the company’s discretion. Each property was held in its own Delaware Series LLC, and investors bought membership interests in that specific entity under a Regulation A offering.
Since the lawsuit, that structure has produced hard consequences for shareholders:
- Dividend payments stopped in late 2024 or early January 2025.
- The app became inoperable by spring 2025, and the investor portal has shown a maintenance message for over a year.
- Users report being unable to sell shares, withdraw money, or get substantive responses from customer service, with waits of 12 to 18 months for a reply.
- More than 130 complaints have been filed against Landa with the Better Business Bureau; one user reported investing over $8,000.
- On April 9, 2025, Landa filed a Form 1-U with the SEC citing a “service disruption” caused by its server provider. Cohen told TechCrunch the site would be back up. By late May 2025, he had stopped responding to press inquiries.
In practical terms, retail investors sit as junior claimants in a liquidation. Because each investor holds membership interests in a specific property-level entity rather than a general claim on the platform, recovery depends on what is left after each individual house is sold and the lender debt, taxes, fees, and costs are paid. Lenders sit above equity holders in the capital stack. Landa’s own disclosures warned that in a bankruptcy scenario, a court could apply assets from one Series LLC to satisfy the liabilities of another, weakening the isolation the structure was designed to provide. The investments carry no FDIC insurance.
Recovery Prospects and Where to Check
As of mid-2026, Landa is functionally non-operational. The app and investor portal remain frozen, no new offerings are active, and both deposits and secondary trading are suspended. Landa’s SEC filings through April 2026 consist mostly of foreclosure notices and property disposition reports, and its auditors have repeatedly flagged “substantial doubt about our ability to continue as a going concern.”
No class action by Landa retail investors has been publicly identified in court records or reporting. The primary litigation is still the lender suit, and properties are being liquidated under court supervision. Investors tracking the situation can monitor Landa’s filings with the SEC under CIK 0001815103 and check the Stanford Securities Class Action Clearinghouse for any investor suit that may later appear. Recovery, if any, is expected to be partial and to arrive slowly as individual properties sell through the wind-down.