Real estate developer Mohamed Hadid’s current court battle over a key plot of land nestled between Los Angeles and Beverly Hills might have been dismissed by observers as a multimillion-dollar private feud—if it didn’t involve part of Franklin Canyon, one of the city’s most popular hiking spots.
For years, Hadid—father of models Gigi and Bella—has been trying to develop a series of megamansions on the land, which he says is worth $131 million, attracting a barrage of unflattering coverage regarding a bankruptcy and building code violations. (In Bel-Air, he’s in the throes of a totally separate battle over an unfinished megamansion the city has ordered be demolished.) He’s currently accusing former friend and would-be business partner Prince Alexander von Fürstenberg, son of fashion designer Diane von Fürstenberg, in a fizzled deal he claims was part of an effort to preserve a portion of his land as a hiking trail and park, and it’s bringing new court scrutiny to the already high-profile saga. It’s a continuation of the same battle that resulted in an appellate court in 2016 ordering hikers off a portion of the Hastian Trail that runs onto Hadid’s property.
A judge’s tentative support for Hadid led to the cancelation of a foreclosure auction set for April 29 involving the Franklin Canyon properties. As Hadid tells it in court papers, von Fürstenberg agreed to buy a portion of the land for $20 million, then backed out in favor of a debt-buying scheme that targeted the entire six-lot property.
On the opposing side of this argument is Ronald Richards, a Beverly Hills attorney who describes himself as a hopeful preservationist for the Franklin Canyon hillside. Through an LLC called Give Back, he’s leading a group of debt buyers as they try to foreclose on Hadid’s ownership in two separate LLCs that own the land, and, according to Richards, ensure it stays undeveloped forever.
But Hadid contends Give Back LLC is truly the work of von Fürstenberg, and that Richards is helping von Fürstenberg in a years-long attempt to essentially pull the land out from under him. Richards flatly denies that and says any allegations about von Fürstenberg are irrelevant.
“I honestly don’t even know what he’s talking about. That person is not a member or manager of my company,” Richards said. Von Fürstenberg couldn’t be reached for comment.
Hadid’s attorney said he’s not sure preservation is part of Hadid’s official development plans.
Hadid’s lawyer, Jeff Reeves, told Los Angeles magazine Hadid has always wanted to dedicate some of the land for public, though he said he’s not sure preservation is part of Hadid’s official development plans. Still, Reeves said that shouldn’t matter: He believes Hadid “is being prejudiced, in a way, by having let the public roam freely on his land for so long.”
“Now they want to deny him his rights to develop his own private property as the authorities and courts have already found that he is free to do,” Reeves said.
For the advocacy group Hillsides Against Hadid, Give Back’s involvement is a god send.
The group’s website describes it as a collection of “canyon community neighbors who seek to protect our precious hillsides, hiking trails and wildlife habitat from further destruction by Mohamed Hadid and others like him.” It calls Give Back’s involvement in the saga and its preservation commitments “obviously great for Franklin Canyon and the public.”
“Whoever is behind ‘Give Back’ and its astonishing generous philanthropy (we have some theories…), we all owe them a serious debt a gratitude,” the website says.
In court documents, Hadid blames von Fürstenberg for “a negative public relations campaign to malign me and any plans to develop the Properties.”
“To me it is obvious that Alex’s and Give Back’s real goal is to take ownership and control of the entire project and leave me with nothing after my two decades of fighting for these properties,” a declaration Hadid filed in Los Angeles County Superior Court says.
Hadid references quotes from Richards in a February New York Times article in which Richards says if Hadid doesn’t pay his debt on the land, “we’ll have the right to do whatever we want. And that’s to let the grass grow.”
Hadid now says he can pay his debt to Give Back, but he’s trying to determine the correct amount, and Richards won’t give him a full accounting because Give Back’s “intention is to obtain the ownership of the Properties, not to get repaid.”
Reeves went to court April 23 to try to stop the foreclosure auction regarding Hadid’s membership interests in the LLCs that are indebted to Give Back. In a motion for a temporary restraining order, Reeves said Give Back was essentially trying to suppress interest in the auction by withholding key debt information and “at a bare minimum, is ensuring that it possesses critical insider information over any such potential bidders.”
In court documents, Reeves goes so far as to say it’s “in the public’s interest” that Hadid keep the land for his development plans.
“He has expended significant time, funds, and resources to make this dream come true…Hadid has a clear plan for the development and it is in the public’s interest to permit him to see that plan through,” Reeves wrote in court documents filed April 22.
But Reeves tells Los Angeles that Hadid still wants to preserve the land, and that he’s still willing to sell it to von Fürstenberg or another buyer if he can get a fair accounting. Some of his evidence includes text messages between Hadid and von Fürstenberg in which Hadid tells von Fürstenberg: “our legacy will make us Heroes to our kids and grandkids.”
“We both trying not to be greedy about our needs,” Hadid told von Fürstenberg.
In a phone hearing, Los Angeles County Superior Court Judge Elaine Mandel said she intended to grant Hadid’s request for a restraining order on the sale “for a short period of time” while she considers the request for a permanent injunction. She encouraged the lawyers “to see if there are more creative ways to address some of these issues.” She’s also tentatively granted a summary judgment motion in Richards’s favor, which concludes Hadid owes Give Back $25 million.
As Richards tells it, her final decision on that is much more important. He acknowledged canceling the sale was extraordinary, but he said it was a strategic move to focus on securing the final $25 million judgment.
But Reeves appears ready for a continued fight, because he believes Give Back’s “inflated and inconsistent demands” mean Hadid won’t resolve his debt even if he pays the $25 million judgment.
“This is hardly the end of the story,” Reeves told Los Angeles.
Update: Reeves and Richards stipulated to a $26.3 million judgment, so Judge Mandel won’t need to finalize her summary judgment order. But the fight over how much Hadid actually needs to pay to settle his Give Back debt remains unresolved.
Meghann M. Cuniff is a freelance journalist focused on legal affairs. She’s on Twitter @meghanncuniff.