Tech billionaire Khosla loses battle over public beach again – and still grants no access

Law slowly shutting down Sun cofounder's legal campaign

Fake garage doors

Most famously, residents of Malibu Beach, just west of Los Angeles, have been battling with security guards, hidden entrances and even fake garage doors in order to access billionaire beaches.

But Khosla's efforts have taken shamelessness to a new level. Khosla does not own the beach but did buy the land next to it and, critically, the land on which the access road to the beach stands, back in July 2008.

Initially, Khosla maintained the same system as the previous owners – allowing access, charging a small parking fee and even running a small store at the beach – but then, in September 2009, he locked the gates and embarked on a wide-ranging legal battle to ensure he doesn't have to open them again.

California residents did not take the matter lying down, and one lawmaker even proposed and passed a specific piece of legislation in 2014 that forced the State Lands Commission to "consult, and enter into any necessary negotiations, with the owners of a specified property known as the Martins Beach property… to acquire a right-of-way or easement for the creation of a specified public access route to and along the shoreline, including the sandy beach."

Khosla continued to fight, paying lawyers to stall and stymie negotiations with the commission, and suing both the commission and its commissioners personally.

When he finally offered to sell the land on which the access road stood for a staggering $10m – when the land is only worth $380,000 – commission staff said they had had enough and recommended to the commissioners that they use the very rarely used power of eminent domain to force Khosla to sell the relevant piece of land.

Caved

But at a meeting in December, Lieutenant Governor Gavin Newsom killed that proposal out of fear that upsetting Silicon Valley billionaires would damage his chances to win the Californian governorship in 2018.

Instead of resolving the issue once and for all, Newsom pleaded with Khosla to negotiate – even though the commission's own staff explicitly said that any such effort was almost certain to prove fruitless given its two years of prior negotiations.

Newsom then pointed to the lawsuits, and argued that "there are three pending lawsuits that could resolve this more quickly than we could."

That is debatable since it has now been eight months since the commission's decision, and only this week has the first lawsuit's appeal decision been delivered. It is very probable that Khosla's legal team will now appeal that decision to the Supreme Court. And it will definitely appeal any decision against him on whether he has to grant access as far up the legal system as possible: a process that could take another ten years.

What is more likely is that once the governor race in 2018 is over and Newsom not longer fears political blowback, that the next Lieutenant Governor on the State Lands Commission of California will take a stronger position and force Khosla to sell his land.

Because so far in the seven years of battling over Martins Beach, Khosla has proven himself more than willing to spend small amounts of his fortune hiring lawyers to aggressive fight any effort to let the public on the beach.

It seems all too likely that he has happily resigned himself to spending $10m keeping it to himself and his family for ten years. At $1m a year, that could look like a good deal for someone who is worth $1.75bn.

Or, to put it in terms of the average net value of a 62-year-old American, it would be the equivalent of spending just over $1,000 a year for your own private beach in the one of the most coveted coastlines in the world. ®

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