Empire State Building investors filed a lawsuit against real estate magnates Peter Malkin and his son Anthony Malkin on Tuesday. According to the suit, investors lost more than $300 million because of Malkins’ decision to take the skyscraper public despite receiving a much bigger all-cash offer.

Empire State Building IPO

Why Empire State Building IPO was not good for investors

Malkins had turned down the $2.3 billion all-cash offer. Instead, they took the Empire State Building public at $13 a share or $1.89 billion. The suit has accused Peter and Anthony Malkin of putting their own interest above those of thousands of investors. The Malkins bundled the Empire State Building with 17 other properties in their portfolio into Empire State Realty Trust Inc. (NYSE:ESRT). Many investors were already against the IPO and had filed a lawsuit. But Malkins settled the case for $55 million before taking it public on October 1. The father-and-son duo gained about $300 million from profit sharing provisions and fees. The lawsuit says the IPO was only in the best interest of the Malkins. A bidding war for the building would have been better for investors, but the IPO enriched the Malkins by hundreds of millions of dollars.

Plaintiff Marc Postelnek is seeking class-action status for the lawsuit. Marc is representing more than 2,800 investors of the Empire State Building Associates LLC, which is supervised by Malkin Holdings LLC. John Rizio-Hamilton, the lawyer representing Marc Postelnek said in a statement that the Malkins had control and authority over the Empire State Building. It was their primary duty to act in the best interest of investors. But the Malkins breached their duty by failing to maximize the building’s value.

Empire State Building investors seek the money they lost

The lawsuit seeks to recover the amount investors have lost due to Malkins’ refusal to sell the iconic building at a higher price when offers were pouring in. Empire State Realty Trust Inc. (NYSE:ESRT) said on behalf of Malkins that the claims have no merit.

The Empire State Building was opened in 1931, and it remained the world’s tallest tower for almost four decades. The Empire State Building is a cultural landmark, and is featured heavily in entertainment, such as in the movie Sleepless in Seattle starring Tom Hanks and Meg Ryan.

Shares of Empire State Realty Trust Inc. (NYSE:ESRT) were down 0.20% to $15.30 on Thursday closing.