An attorney who brought a lawsuit against several law firms and real estate development firm Bayrock Group is promising to challenge the dismissal of the case, even while he reportedly remains under a criminal contempt investigation.

The now dismissed suit, filed in Manhattan Supreme Court in 2015 and unsealed last year, was brought as a whistleblower action under New York's qui tam law and filed by solo practitioners Frederick Oberlander and Richard Lerner. The state of New York declined to intervene.

Defendants in the qui tam suit included Kramer Levin Naftalis & Frankel; Akerman; Nixon Peabody; Duval & Stachenfeld; and Roberts & Holland. Other defendants included Bayrock Group and ex-Bayrock executive Felix Sater. The suit claimed that certain law firms facilitated an alleged tax fraud.

Their lawsuit alleges certain defendants failed to account for $100 million of income and failed to account for and pay a real estate transfer tax. When the case was unsealed last year, Oberlander and Lerner had said President Donald Trump, who worked with Bayrock on real estate deals, was a “material witness” in the matter.

Oberlander and Lerner were previously co-counsel on a similar suit filed seven years ago in federal court and in the meantime have faced intense scrutiny by federal court judges, including one who referred them to authorities for a criminal contempt investigation. They have been accused of disclosing sealed information about Sater's cooperation with the government.

Despite the contempt investigation being initiated several years ago, the investigation hasn't ended, according to Sater's defense attorney, Robert Wolf, a partner at Moses & Singer. “I called and spoke to the assistant United States attorney in the district that's conducting the grand jury investigation, and he confirmed that it's still pending,” Wolf last month told Manhattan Supreme Court Justice Charles Ramos at a court conference in the qui tam case.

Defense attorneys during the conference in the state case argued the complaint incorporated large portions of the federal suit, which ultimately had to be revised because, they said, it included privileged information that Oberlander improperly obtained from an ex-Bayrock employee. “You cannot take the fruits of your wrongdoing and use it for the basis of your complaint,” said Walter Saurack, an attorney to Bayrock, during the conference before Ramos. Saurack is a partner at Satterlee Stephens.

“The movant [the defense] is taking the position that the complaint in this action … is predicated in part, or in whole, upon the 400 stricken allegations in the federal case, the Southern District case. Is that true?” Ramos said to Oberlander. “How could I hear it, or entertain it?”

“Obtaining this information, whether you did anything wrong or not, those documents were privileged,” Ramos told Oberlander at another point. “The complaint is dismissed in its entirety. On the merits. I never want to see this case again.”

Ramos expressed impatience toward the case during the conference. “Cases like this I like to drop back 15 and punt the ball,” he said, according to the transcript.

According to a Monday order, the judge dismissed the case without prejudice to the rights of the state.

In an interview, Oberlander said “there seems to be no clearly discernable basis” for the dismissal and he intends to challenge the order “by any and all means appropriate,” such as through reargument, reconsideration or an appeal.

Saurack, Bayrock's attorney, said in a statement that he was gratified by the ruling and he has “maintained throughout that the lawsuit was without merit and based on stolen confidential materials.”

Wolf, Sater's attorney, said the case's dismissal “reflects the court's recognition that the tax fraud claims were a baseless perpetuation of extortionate litigation efforts.”

A spokesman for the U.S. Attorney's Office for the Northern District of New York, which has reportedly handled the contempt investigation, declined to comment.