Court orders tech billionaire to open up Martins Beach

By Paul Rogers | | Bay Area News Group

PUBLISHED: August 10, 2017 at 2:31 pm | UPDATED: August 11, 2017 at 12:33 pm

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A Silicon Valley billionaire who locked the gates at a popular Northern California beach must open them to the public, a state appeals court has ruled.

In a decision that could have far-reaching impacts on other coastal access cases, the First District Court of Appeals in San Francisco ruled 3-0 that venture capitalist Vinod Khosla violated the California Coastal Act when he ended decades of public access to Martins Beach, south of Half Moon Bay, after he purchased the 89-acre property surrounding the beach.

Upholding a 2014 ruling by the San Mateo County Superior Court, the appeals court judges, in a 50-page ruling released Thursday, ordered Khosla to open the gates immediately.

SJM-Martins-0811-WEB”This is one of the most important issues of the day,” said Joe Cotchett, of Burlingame, an attorney for the Surfrider Foundation, an environmental group that filed the lawsuit. “Can wealthy individuals buy up our beautiful beaches and say, “˜Screw you, you can’t walk to the water any more?'”

Khosla’s attorneys, who have argued the case is a violation of his private property rights, are expected to appeal to the state Supreme Court, and eventually perhaps, the U.S. Supreme Court.

The challenge could go to the heart of the California Coastal Act, passed by voters in 1972, and redefine when and how the public can access California beaches. Khosla’s lawyers did not respond to requests for comment Thursday. A woman who answered the phone at Khosla Ventures, his venture capital firm on Sand Hill Road in Menlo Park, simply replied “no comment.”
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Apart from the legal battles, the State Lands Commission has been in negotiations with Khosla, who has an estimated net worth of $1.5 billion, to purchase an easement to allow public access over the private road. Because the secluded beach is flanked on both sides by high cliffs, the road is the only access point to the beach.

The commission, whose three members include Lt. Gov. Gavin Newsom, a Democratic candidate for governor in 2018, could use eminent domain to take the property, but they would need money from private donors or the Legislature to fund the purchase.

Khosla’s lawyers said a year ago that he would sell an easement to pass through his land for $30 million, nearly as much as he paid for the entire property. The commission’s staff estimated that rights to use the path, totaling 6.4 acres, have a market value of $360,000. They remain at a stalemate.

“This is a dispute concerning principle, and Mr. Khosla is unwilling to be coerced into giving up a vested constitutional property right,” Khosla’s attorney, Jeffrey Essner of San Jose, said in December at a meeting of the State Lands Commission.

Advocates for reopening the beach, which Khosla has opened a few times in recent years briefly, only to close the gates again, say the issue is not about taking his property. It’s about restoring access, they contend, that families, surfers and fishermen enjoyed and established over generations when they traveled down the two-lane private road to the shoreline.

The court agreed in Thursday’s decision, citing a provision of the Coastal Act that requires Coastal Commission permits not only for people who want to build along the coast, but for “change in the intensity of use of water, or of access.”

“This is not about closing the gate to your house, or to your backyard,” said Cotchett. “It is closing the gate to an access road, or path, that allowed people for all these years to put their feet in the water, catch fish or go surfing.”

Khosla, 62, is an engineer who co-founded Sun Microsystems in Santa Clara. In July 2008, he bought the Martins Beach property for $32.5 million.

By September 2009, Khosla locked a gate that had provided public access to the shoreline. He posted guards, put up a “Beach Closed” sign and set off a furious controversy. The land’s prior owners, the Deeney family, for generations had allowed the public to visit the beach for much of the year in exchange for a parking fee.

The Surfrider Foundation sued Khosla in 2013. It argued that Khosla’s two holding companies, Martins Beach LLC 1 and 2, needed a permit from the California Coastal Commission because they had changed the terms of public access in violation of the Coastal Act.
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Last September, Khosla fired back, suing the coastal commission and State Lands Commission in federal court. In that lawsuit, which is still pending, he accused them of “a concerted effort by state and local officials to single out, coerce and harass one coastal property and its owner for refusing to cede its private property rights.”

Khosla claims the agencies have gone after him for “purely personal and political reasons.”

On Thursday, Cotchett said he expects Khosla to open the gate immediately, given the appeals court ruling, unless he is able to obtain an injunction from the California Supreme Court.

“I think the public is going to get access just they way they have had it for 70 years,” he said. “If he doesn’t open it, I will ask the court for a contempt citation, and maybe we’ll have to get the sheriff to put his ass in jail.”

Thursday’s decision was written by appeals court Justice Mark Simons, an appointee of Gov. Gray Davis. The other two judges who concurred were appointees of Republican Gov. Arnold Schwarzenegger, justices Henry Needham and Terence Bruiniers.

The California Coastal Commission, which filed a brief in support of the Surfrider Foundation’s lawsuit, along with the Stanford University Environmental Law Clinic, said it is watching the case closely and has an active enforcement investigation still open.

“There is still a long road ahead, but we are encouraged by this decision, ” said Jack Ainsworth, executive director of the California Coastal Commission. “We are hopeful that the day will come when the locks are cut off the gates and the public can once again walk across the sand at Martins Beach and go for a swim at the beach.”

On the other side, numerous prominent organizations lined up to file briefs in support of Khosla’s position, including the Pacific Legal Foundation, California Farm Bureau Federation, California Cattlemen”˜s Association, California Association of Realtors and California Business
Properties Association.