In August 2010, the New York City Board of Standards & Appeals ruled that Benjamin Shaoul must removed four cabin-like structures on the seventh floor of his adjoining buildings at 514-516 East Sixth Street in the East Village.

Mr. Shaoul had added the sixth and seventh floors to the two buildings in 2006 and 2007 and tenants sued the Department of Buildings for issuing permits for the additions, according to an Augusts 4, 2010 article in The New York Times by Cara Buckley.

The tenants said that the additions violated the state s 1929 multiple dwelling law by flouting fire and elevator rules that required updating fireproofing and installing passenger elevators for buildings higher than six stories.

In November 2008, the Board of Standards and Appeals ruled that the Buildings Department did not have the authority to authorize variances on the multiple dwelling law, the article said, adding that "Mr. Shaoul then appealed to the Board of Standards and Appeals for a variance, and got one that permitted the sixth-floor apartments to remain. The seventh-floor cabins are connected to the sixth-floor apartments, forming duplexes that have never been occupied because of the legal fight. Mr. Shaoul did the same thing with the building he owned at 515 East Fifth Street."

"When the tenants of 515 E. 5th St. and 514-516 E. 6th St. brought their appeal to the BSA (Board) opposing the DOB's allowance of the construction of two extra floors the Board agreed and issued a unanimous ruling revoking all permits, a commenter on the article said, adding that "The owners then appealed to Supreme Court. That Judge tabled her decision and told the owner's they had not exhausted their administrative remedies, i.e. they could seek their own variance at the BSA. The owners then went back to the BSA to do so but only on 514-516 E. 6th Street leaving the 5th St. building in limbo."

"The owners," the commenteer continued, "claimed to have provided 'alternative' fire and safety provisions equal to or better than those required by the MDL but these claims were not been vetted in any way. The Board accepted the owner's claims at face value. The MDL explicity requires a 3 hr. fire rated enclosed central stairwell. This should have necessitated the removal of all highly flammable wood studding and plaster lathing from the interior stair walls, the installation of four layers of fire-proof gypsum board drywall, two on each side of the stair walls (apt. and stair sides), the removal of wood studding from floors, a stairwell at least 3 ft. wide in all places, etc. That's why these vertical enlargements have not been tried all over the city. To strictly comply would be impossible in an occupied building because it most certainly would require a complete gutting of the building interior and total reconfiguration of apts. The BSA has now ruled that simply by saying you have fire-proofed a building and adding a sprinkler system owners may circumvent these MDL restrictions, in place since 1929."

Shaoul, president of Magnum Real Estate Group, was an active residential developer in the boom, building projects such as the Yves in Chelsea at 166 West 18th Street, the A Building at 421 East 13th Street and 636 East 11th Street.