The Orange County Superior Court issued a temporary restraining order to Mo Honarkar on May 5 restricting the local real estate developer, and those acting on his behalf, from coming within 200 feet of Hotel Laguna, 14 West and several other properties, currently disputed between investor group Continuum Analytics and Honarkar’s Laguna Beach Company until the end of this month.
The judgment comes after armed security guards representing both groups clashed last week, prompting City Manager Shohreh Dupuis to close the two hotels out of concern for public safety.
City officials agreed to reopen the properties last Friday under the condition that any onsite security personnel would be unarmed and there were no more threats to public safety. The investor group is now allowed access to and can resume hotel operations until court’s ruling on the request for a preliminary injunction, currently set for May 30.
Much Law Firm’s Issac Zfaty, counsel to Mo Honakar and the Laguna Beach Company, said there are multiple lawsuits pending over the dispute and that the firm is currently looking into financial irregularities they identified earlier in the year with their investors.
“There are tens of millions of dollars in liens that Mr. Honarkar did not know about and which, at a minimum, should have been disclosed,” Zfaty said in a statement to the Indy. “We hope that Mr. Honarkar’s investors will cooperate and explain their actions without any further aggression. They have made various misstatements in their filings that we hope were the product of carelessness and not a deliberate attempt to mislead the court. We will, of course, dispel any false claims at the injunction hearing on May 30.”
In the meantime, however, Zfaty said there were no plans to appeal the temporary restraining order.
“We will abide by the Court’s decision to simply stay away from the hotels for three weeks so that he can sort out the relationships,” he said.
Representing the investor group, lawyer Marc Cohen said it’s “business as usual” at the two hotels.
“At the end of the day, the judge ruled in our favor,” Cohen said. “We have restarted operations and will continue to do so despite Mr. Honarkar’s recent aggressive and inappropriate tactics.”
Last week’s conflicts were related to an ongoing civil dispute over the control of operations and management at the hotel properties between Honarkar and a group of investors who claim to have bailed out Honarkar from foreclosure two years ago.
As part of the bailout, Honarkar contributed all of his assets to a group of investors represented by Cohen Law Group, which includes properties such as Hotel Laguna, the Art-A-Fair building, Cliff Village LLC, Terra Laguna Beach, several vacation homes and the 14 West hotel.
However, on May 2, the Laguna Beach Police Department responded to claims of trespassing and physical altercations between two armed security guard teams at 14 West (formally the Holiday Inn). The police responded to another disturbance at Hotel Laguna in the afternoon and again later at 14 West that evening. The incidents led the city manager to issue a nuisance abatement order late that evening, citing unsafe conditions for the public and Laguna Beach police.