Opinion: When Cheating Becomes a Sacrament


By Paul Freeman

Editor’s Note: Freeman is a former paid consultant for companies managed by Mohammad Honarkar. He has no pending claims against his former client.

Jonathan Sacks writes, “If your faith makes losing a sin, then cheating becomes a sacrament.” This sadly sums up much of contemporary American politics. It’s apropos what’s happening in Laguna.

Three months ago, the former city manager, issuing yet another stop-work order for Mohammad Honarkar’s funny business, this time at Hotel Laguna, wrote: “For this stop-work order to be lifted, you must first obtain the necessary land use entitlements.” No comprehensive plans have been submitted, much less entitlements granted—yet Honarkar’s new Hotel Laguna restaurant is reportedly opening soon.

What changed? Team Honarkar, even as his financial house of cards again looks close to collapse, seems stronger than ever, in City Hall. A new city manager and the council majority allow him to keep circumventing any public process. Look—everyone is anxious for the hotel to re-open. But it turns my stomach to see the drivel on social media celebrating Honarkar for cheating, with the City’s help, to open a restaurant that mainly benefits him, and does nothing to re-open the hotel.

Honarkar claims he’s met all his obligations. Yet local tradesmen are still owed money. Another developer—Honarkar agreed to sell him Hotel Laguna’s lease, then allegedly reneged—has sued him for fraud. His former architectural firm Architects Orange is suing him for more than $679,000 in damages plus attorney’s fees. His current major lender is suing him for $175 million, saying he’s in “monetary and non-monetary default,” that in obtaining his loan to (temporarily, I hope) keep the wolves at bay, he made material misrepresentations.

Equally outrageous is the City granted Honarkar’s Terra Laguna Beach a temporary certificate of occupancy on July 1, 2021, which allowed it to reopen with the Festival of Arts. This opening was 21 days before the restaurant and bar passed an OC Health inspection.

Just last week, Allen Matkins Leck Gamble Mallory & Natsis LLP sued Honarkar claiming unpaid legal fees totaling $270,000 and presenting evidence of the same. Additional lawsuits involve bad faith, misrepresentations, and failure to meet obligations. And then there’s his $5 million-plus in COVID relief funds, for payroll: given his limited payroll, people should examine his use of taxpayer dollars.

All of which begs a question for city leaders. Knowing all this, moreover knowing there are well-financed, capable, successful developers waiting in the wings, why are they going out of their way to help this no-account? No, it’s not to re-open Hotel Laguna. The hotel is not re-opening. There are no such plans—I mean that literally. City leaders are bending over backward, bending rules or disposing of them altogether, to help Honarkar open a restaurant.

Oh, right: he’s improved the look of the place. That’s hardly setting the bar very high. Oh, right: he’s got a world-class chef. Well bully-bully. This plays like some grotesque combination of Donald Trump and the Kardashians. Lies. People stiffed. A victory of celebrity and gesture over substance.

And oh, by the way—the cat is out of the bag about Brown Act violations. But no, I don’t mean by Toni Iseman and George Weiss. That the Council in closed session discussed and voted on matters that cannot lawfully be discussed in closed session: that was the first and primary Brown Act violation. Iseman and Weiss are effectively whistle-blowers. The relevant question is why should the City Manager, City Attorney and Council majority get away with making deals and decisions behind closed doors?

The real shame is this further polarizes an already divided community.

Predictably, a citizens’ anti-development initiative is circulating. Its passage is a smart-money bet. Why? Because faith has been lost in City Hall. The initiative would require any new project within 750 feet of Coast Highway or Laguna Canyon Road that would generate 200 vehicle trips daily (not merely in busy times) to automatically go to the ballot.   Even if a project would generate less traffic than that, but when added to another new project within a short distance would bust the applicable limits, they both must go to the ballot. Oy vey.

This is a recipe not for smart or limited growth, but, most likely, no new projects. Remember the bad opera over the Montage? Montage generates more than 200 vehicle trips a day and I defy anyone to tell me they feel that traffic impact. By the way — and I know the current Council majority may find this all too radical—there were plans for Montage before construction began, after many hearings.

Wake up, Laguna! The adverse impact of visitors is from day-trippers, not hotel guests. Hotel guests don’t clog the streets, and they pay their way. Plus hotel guests buy local art, meals, and more. Quality  developers can create spaces that residents enjoy as much as visitors. Shady no-accounts like Honarkar, especially when conspiring with City leaders, can do real, lasting harm.

Ends rarely justify means, but when people in power decide losing is a sin, cheating becomes a sacrament. Never thought I’d see that in Laguna. But City Hall today is inept, at best. Not that I find comfort in the opposition, as indicated. It recalls for me the brilliant headline over The Economist’s endorsement of John Kerry over George W. Bush in 2004: “Incoherence is Preferable to Ineptitude.”

Paul is a former Laguna Beach mayor.

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  1. Mr. Freeman, you are embarrassing yourself. Slinging mud yet again because you are no longer on their payroll? Time to bury the hatchet and move on.

  2. For several months, Paul Freeman worked on the inside as a consultant to Mo Honarkar’s Hotel Laguna project. He observed first hand how the man operates. Freeman quit, disgusted with the Honarkar’s ineptitude and lack of a moral compass. Freeman’s first hand knowledge of the facts surrounding the Hotel Laguna project and Honarkar’s “house-of-cards” financial shenanigans are indisputable. We would be wise to listen.

  3. @JoeBecker

    Mr Freeman speaks his opinion, sharing his interpretation of events as a third party. One cannot conclude that the entirety of his column is factual. The man clearly holds a grudge. If I am not mistaken, he was Moe’s highly paid political consultant. Makes sense he is now using politics to tarnish the reputation of his ex-employer.

  4. Paul. You have many years in and around public service. You do know the facts even tho you failed to mention the most important fact. There is a process for whistleblowing. Telling ONE citizen information from a closed door session doesn’t meet the standard for that process. George admitted he did it and after 7 months in office is befuddled by clear rules, and doesn’t care enough to learn. Toni. Who knows why she would subject herself to this? She should know better. Either way they violated the law. And that’s a fact by their own admission

  5. I appreciate Mr. Freeman’s perspective on our City’s treatment of Developer Mo Honarkar. His insider’s view is valuable. But, I’d like to set the record straight with regards to some of Mr. Freeman’s comments regarding the Laguna Residents First ballot measure that he mentions in his piece:

    He states that “The initiative would require any new project within 750 feet of Coast Highway or Laguna Canyon Road that would generate 200 vehicle trips daily (not merely in busy times) to automatically go to the ballot.”

    Actually, the traffic “trigger” states that a project that “worsens traffic by causing 200 or more additional Average Daily Trips”. Additional. More than the parcel currently imposes. Nuance is important.

    He also completely misses the “cumulative effect” trigger. The BI states: “(e) “Cumulative Effect” means the development project, when considered together with other Cumulative Properties, will cause more than 800 Average Daily Trips or will cause the construction
    of more than 88 ,000 square feet of gross floor area. Cumulative Effects shall be calculated by summing the square footage of the gross floor area and summing the average daily trips of the applicable Cumulative Projects with those of the development project under consideration.”

    In short, cumulative effect looks at a current proposed project, PLUS other in-process or recently completed projects, to assess the total cumulative nuisance that a particular neighborhood has had to endure, to determine if the current proposed project needs to go to a vote, before being allowed to proceed. Unlike what Mr. Freeman states: “they both must go to the ballot”, No. If the previous nearby project has been given the go-ahead, then it continues to go-ahead. Only the current proposed project might be forced to go before the voters, again, taking the nearby neighborhood’s quality-of-life into consideration.

    For full transparency, there are other triggers that proposed commercial developments within the 750′ range of LCR or PCH might hit, which would also force them to go before the voters for approval: parking requirements, parcel combinations, proposed sq footage and proposed height. For those interested in the details, please visit:
    http://www.lagunaresidentsfirst.org where you can read the entire ballot measure (its only about 9 pages long).

  6. Thank you Mr. Freeman for sharing your up-close and in-depth knowledge of what has transpired on our landmark Laguna Hotel at the hands of Mo Honarkar/LBC and our City Staff. Wow -if there was ever a time to be concerned about our city governments lack of transparency and private investor activities and actions it is right now.

    IMO – One of the most concerning statements you make is this one: “And oh, by the way—the cat is out of the bag about Brown Act violations. But no, I don’t mean by Toni Iseman and George Weiss. That the Council in closed session discussed and voted on matters that cannot lawfully be discussed in closed session: that was the first and primary Brown Act violation. Iseman and Weiss are effectively whistle-blowers. The relevant question is why should the City Manager, City Attorney and Council majority get away with making deals and decisions behind closed doors?”

    If I am interpreting this statement right – our entire City Council is involved in a Brown Act Violation and possibly our City Manager and City Attorney. If so, a BA violation claim should be filed against all. It is confusing for sure. IMO – until we examine and confirm whether or not the city Laguna Hotel business stop work orders and/or approval to resume discussion and vote was legal to have in private (closed session) rather than remaining public like all other city construction business projects under no formal legal claim or active lawsuit, it would seem inappropriate for Mayor Whalen and City Attorney Phil Kohn to pursue a separate Brown Act violation against two of the Council members for discussing the topic. It’s beginning to sound like there may have been an insider attempt by some members of the Council and City staff to hold the discussion in a “closed session” to limit the ability of other CC members to ever discuss the Hotel Laguna status with openly concerned and inquiring public which put them in a staying silent or a whistleblowing situation. This must be fully investigated. Especially if any action is taken by the Mayor, Mayor Pro-Tem Kempf and Peter Blake at the August 10th City Council meeting. I support city government transparency and public official’s who put honesty and integrity first and will risk themselves to uphold these qualities.

  7. Michael m
    This ballot measure is ill conceived and unnecessary. This would undo years of work towards creating long term solutions for a downtown specific plan. The promenade and parking/circulation. The party of NO is unhappy because the city finally has a council that will try to plan for the future. AND do it legally George Weiss your compatriot has broken the law. There was a way to be a whistleblower instead he chose to be lawbreaker. There may be more than a censure coming out of this. I doubt if citizens want this nonsense from groups like yours

  8. “The people of this State do not yield their sovereignty to the agencies which serve them. The people, in delegating authority, do not give their public servants the right to decide what is good for the people to know and what is not good for them to know. The people insist on remaining informed so that they may retain control over the instruments they have created.” The Brown Act (1953)

  9. I know and have worked both collaboratively with and against Paul many moons ago, yet I do have one concern I don’t see being addressed. And full disclosure, we often run into each other at the postal annex, we’re always civil, respectful and I bear him no ill will.
    I would, as a consultant and advisor myself though, point out something obvious I haven’t as yet seen addressed: In many instances, we sign NDAs and/or Confidentiality/Proprietary Agreements as part and parcel of professional advisory services.
    It’s difficult for me to imagine under the heated and controversial circumstances these past few years that the Honarker’s wouldn’t have made that enforceable demand, damages/arbitration methodology usually in the fine print.
    Being righteous in a complaint(s) doesn’t necessarily==Have the right to breach such private agreements. It’s NOT public government and this wasn’t Paul’s first developer rodeo, he worked for Harry Segerstrom for years.
    I’m not sure if Paul signed such a legally-binding document, but if he did then he has left himself open to litigation—–possibly expensive for him. This might end up a GO FUND ME situation as Paul (possibly) took one for the team (the people of Laguna). Who could or maybe more likely not help him $$$-wise for legal counsel. A comment, Op-Ed or LTE costs nothing, isn’t commitment.
    Let’s see, but if I were him, I wouldn’t depend on it: Success has 1000 fathers, failure an orphan.
    Martyrdom isn’t in my Scope of Services, and as a former activist it’s not of much value………..nor have I in 20 years seen such a compensatory sacrificial clause in my land use and enviro-consultant/advisory contract history as I transitioned from General Contractor.
    Knowing the constantly shifting sands of fealty, patronage and power in Laguna, I’m wondering if I’m the only one who views this as bringing out, forcing, exacerbating yet more suspicion and polarization too?
    Think about it: Note how many shove people like us out front, then abandon us and fail to follow up with the mute button or no more than a flaccid comment or LTE.
    There’s a lot of ingratitude for the bold warriors.
    When I was a GC, I had many a leery, burnt-before client that distrusted construction people period.
    Paul’s actions & opinions might be due to REAL outraged altruism, but another perspective is its undermining of boutique, small sole proprietors like myself.
    Fiduciary relationships aren’t just about the City and its history of obvious favoritism/nepotism, to the victor go the spoils of election wars, political hanky-panky: They’re also about business practices.
    To me it’s no different than your doctor, your dentist, your real estate agent, your landlord, your bank—-whoever you have expected and/or acknowledged, binding trust with regarding personal information.
    Having grown up in tough neighborhoods (LA HARBOR), daily barrio life for a white dude was like a mosh pit. Laguna’s starting to look a lot like the vicious gauntlet of the parking lot at Phineas Banning High (Wilmington).

  10. To Cindy Shopoff— You talk about Toni and George violating the Brown Act, because they failed to follow the proper protocol for whistle-blowing, and you chide me for failing to emphasize that point. Okay. Let’s say they blew their whistles badly. But so sorry, Cindy, don’t you dare pretend to be standing up for proper protocol much less principle when you fail to acknowledge that the Council discussed a stop-work order, and discussed and voted to approve a Temporary Use Permit, in closed session — clearly violating the Brown Act. Plus they failed to announce their actions, another violation of the Brown Act. Therefore if one or two Council members deserve censure, or worse, then they all do, along with the City Manager and City Attorney. And you know that as well as I do. The unfortunate irony is that by employing such a double standard, by being so hypocritical, you are helping the very people whom you say, in some cases correctly, are putting up unreasonable roadblocks to quality redevelopment in Laguna.

  11. To Mr. Johnson — I’m slinging facts, not mud. My grudge is not with MH, it’s with the city management and city council majority who are enabling him, including via illegal means. If it doesn’t bother you, sir, that regular citizens are regularly fried by city hall, whereas someone of MH’s ilk gets a green light on his business in a closed session with no comprehensive plans and not a single public hearing, then congratulations: you’ve got precisely the sort of local government you deserve.

  12. I am letting everyone to know I am here and observing everything that is communicated among you all.
    I am not a resident of Laguna Beach however, I have a lot to contribute to the subject of what’s going on, and will talk when the time is right.
    Sincerely yours

  13. Hi, Mohammed B Mardeban again.
    I forgot to let you all know that I know Mr, Mohammad Honarkar and his family very closely very well ever since 1989.
    I also know that every time he falls into the holes, how he get himself out of it!
    Most likely, he will take himself out of this one too. How he does, it will be very interesting!!!!!
    Since I know Mr, Honarkar that well, As said before i am more optimistic where Mr, Paul Freeman standing in this matter.
    Good Bye.

  14. Oh, I am also going to write a book about my life events which going to be very eventful and exciting entirely.
    And in it, I am also going to dedicate a chapter about HONARKAR’s family in my life from day one to this day and everything and anything happened in it.
    Best Regards

  15. And in my book that I am going to write, A person will be called the MASTER OF DECEPTION!
    Because to the best of my knowledge and as far as I remember, from day one to this day of my life, this person has done anything and everything to manipulate my life and the others to get what it wants.
    And it only had negative results on my life as well as the others most of the time.

  16. Hi, it’s me again, Mohammad B Mardeban.
    Two corrections on my previous notes.
    First correction, It was the beginning of the year 1988 when I first met MH with his brother-in-law in my office and not in 1989.
    Second correction, the results of the manipulating of the subject person in my as well as the other’s life has not only been negative, it’s been much worst than than that, it’s being devastating.
    As I said before unless Mr, Paul Freeman doesn’t want me to, I like very much the way he feels about the funny ways that Mr, MH started to do business in Laguna Beach.
    Sincerely Yours

  17. This quote from the author says it all: “Ends rarely justify means, but when people in power decide losing is a sin, cheating becomes a sacrament. Never thought I’d see that in Laguna. But City Hall today is inept, at best.”


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