State Senator, 2 Others Settle Suit Alleging Land Swindle

State Sen. Alan Robbins, a business associate and a Huntington Beach savings and loan president have agreed to a “six-figure” settlement of a lawsuit by a Ventura County developer who accused them of swindling him out of nearly $37-million worth of property, the developer’s attorney said.

The lawsuit, filed by developer Robert A. Felburg in Ventura County Superior Court in 1987, maintained that Robbins (D-Tarzana), Chatsworth businessman Michael Goland and Mercury Savings & Loan President Leonard Shane conspired to bilk him out of more than 3,800 acres of prime land in Ventura County.

Robbins, Goland and Shane denied any improprieties.

Felburg’s attorney, Haskell J. Shapiro, said a settlement was reached but declined to discuss its terms except to say it was cash “in six figures.” He said he was not told by attorneys for the defendants who would be paying which portion of the amount.

Tentative Settlement

The attorney for Robbins, Melvyn B. Fliegel, also declined to discuss the settlement, describing it as tentative and saying its exact terms are still being negotiated. He said the pact is also subject to final approval by a bankruptcy judge. Felburg has been in bankruptcy proceedings since 1981.

Shapiro said he thought that most of the settlement would be paid by Robbins and Mercury Savings or Shane. But Fliegel said Robbins has not agreed to pay any money as yet, and Shane declined to comment.

Shapiro said he doubts that Goland will pay much, if any, of the money, saying Goland has experienced heavy financial losses recently. Goland, who could not be reached for comment, has been indicted on federal charges that he tried to help reelect Sen. Alan Cranston (D-Calif.) by illegally donating $150,000 to a minor-party candidate in hopes of drawing votes from Cranston’s 1986 Republican opponent, Ed Zschau.

“Who won? There’s no all-out winner,” Shapiro said of the lawsuit. “In this line of work . . . the idea is a good settlement is better than a good trial.

“In order to say we really won, we would have needed about five times what we’re getting.”

Oct. 30 Trial Date

The settlement came as the suit approached an Oct. 30 trial date and shortly after Shapiro won court permission to amend the suit to further accuse Robbins of violating the federal Racketeering Influenced Corrupt Organizations Act.

Fliegel denied that a potential RICO allegation prompted Robbins to settle. Fliegel said evidence to back such a claim, often applied in organized crime cases, “just didn’t exist.”

Fliegel said the lawmaker settled out of court “because it was a hell of a lot cheaper” than taking the matter to trial, which, he said, could have lasted as long as 30 days.

Felburg’s suit focused on two parcels of land that he once owned in Ventura County. One is a 3,800-acre tract that was once part of the Strathearn cattle ranch, which straddles Moorpark and Simi Valley. The other is an 18.8-acre commercial parcel in Thousand Oaks. Felburg’s suit said the value of his equity was nearly $20 million in the ranch property and $17 million in the Thousand Oaks property.

Felburg, 68, who became a multimillionaire by buying and selling real estate, is perhaps best known for his lofty but failed scheme to transform the ranch property into a “solar city” featuring 15,500 homes powered by sunlight. Plans for the development, dubbed Solaris, collapsed in 1985.

In his suit, Felburg said he met Robbins in 1984, about three years after the developer ran into financial problems and filed for bankruptcy. In court papers, Felburg listed land holdings scattered across Southern and Central California valued at more than $88 million.

The two men agreed that Robbins would act as a loan broker for Felburg, trying to drum up financing for his properties in exchange for a commission on any loans secured, according to court documents. Robbins assured Felburg that he could obtain loans “because of his special capabilities and influence in the community,” Felburg said in the suit.

At the time, Robbins was a member of the Senate Banking and Commerce Committee, which proposes laws governing banks and savings and loans. In an interview, he acknowledged soliciting loans from financial institutions on Felburg’s behalf but denied that his actions constituted a conflict of interest.

“I don’t know of any member of the committee who has not at some time applied for a loan for himself directly or on behalf of a client,” Robbins said, adding that he was unable to secure bank loans and received no commissions from Felburg.

Potential Lender

According to court documents, Robbins introduced Felburg to Goland, a business and political associate, as a potential private lender. At the time, Felburg was facing foreclosures on both the Strathearn and Thousand Oaks properties.

After telling Robbins of the urgency of the situation, Felburg was informed by Robbins that Goland had agreed to lend the developer $1 million on the Thousand Oaks parcel, court papers say. Robbins also told Felburg that he had lined up a deal by which Mercury Savings, which held the note on the property, would postpone foreclosing on it for a year in exchange for a $1-million payment, according to the lawsuit.

Instead, within 24 hours of a scheduled foreclosure sale, Goland refused to put up the money and Mercury took back the property, the suit said. The same day, Mercury sold the property to Goland for a $1-million down payment, Felburg’s suit says. About two months later, Robbins became a partner with Goland in the land, Felburg said.

Felburg said Robbins also failed to tell him of the “extremely close relationships” that existed between Robbins and Goland and between Goland and Shane. The suit contended that Goland’s and Shane’s families had recently vacationed together in Israel.

Denials in Papers

In court documents, Robbins denied telling Felburg that Goland would lend him money on the property. He acknowledged that he became Goland’s partner after Felburg lost the land but said his broker’s agreement with Felburg permitted him to do so. Shane also denied any improprieties.

Felburg maintained that Robbins and Goland took over his Strathearn ranch property in similar fashion. He said that Goland, through Robbins, promised to lend him $300,000, which he planned to use to gain a six-month extension of a foreclosure deadline.

But Goland again reneged on his promise at the eleventh hour, Felburg’s suit says. He bought the property from Felburg for $300,000 but gave him an option to buy it back at a later date. And again, according to court documents, Robbins subsequently wound up a partner in the land.

Robbins and Goland denied promising to lend money for the ranch or conspiring to take it over.

Sell Out Interest

Robbins said Goland later decided to sell out his interest in the ranch. And Robbins said he arranged for another business and political associate, wealthy La Jolla investor Jerry Simms, to take it over. Simms then insisted that Robbins become his partner, which he did, Robbins said in court papers.

Simms and Robbins are suing each other in connection with their sale of the Strathearn ranch to another company.

Earlier this year, Goland’s trial on election fraud charges ended in a hung jury. At the trial, prosecutors described Goland as an avid supporter of Israel who wanted Cranston to win because of the senator’s pro-Israel voting record. Goland’s attorney contended that incompetent political consultants caused Goland’s legal troubles.