Developer Threatens to Sue for Defamation : Porter Ranch: The builder says a member of a homeowners group opposing the project suggested he made illegal payments to a councilman. But a candidate calls the warning a scare tactic.

The developer of Porter Ranch has threatened to sue a homeowners group that opposes the $2-billion project, claiming one of its members defamed him by falsely suggesting he made illegal payments to Los Angeles City Councilman Hal Bernson.

In a series of letters starting last September, an attorney for developer Nathan Shappell demanded that the group, PRIDE, retract several allegedly defamatory statements made about Porter Ranch, the massive development of 3,400 dwellings and 6 million square feet of commercial space to be built north of Chatsworth.

Meanwhile, one of PRIDE’s leaders, wealthy Northridge businessman Walter Prince, charged Thursday that Shappell’s threat is intended to scare him out of his campaign to unseat Bernson, a key Porter Ranch supporter, in the April 9 city primary election.

“I think they’re trying to intimidate me into dropping out of the campaign . . . They don’t want me in that council seat since I’ve pledged to stop Porter Ranch,” said Prince, who is among five candidates challenging Bernson.

Shappell’s lawyer, Ronald J. Silverman, denied that his client was trying to drive Prince from the race.

Silverman began demanding a retraction from PRIDE after the Northridge-based group filed a lawsuit last August seeking to force Shappell to cut the volume of commercial space by 75%. A Los Angeles judge ruled against the homeowners in December, although they are considering an appeal.

In a Sept. 21 letter to PRIDE, Silverman cited three documents purportedly written by PRIDE members, claiming that they contained statements that “crossed the line between vigorous public advocacy and defamatory conduct.”

Silverman cited a one-page document apparently signed by former PRIDE spokesman Robert Birch. It was dated Dec. 12, 1989, and addressed to the City Council Planning and Land Use Committee, chaired by Bernson, and concerned a public hearing about the project. It said that besides his city salary, Bernson “collects for himself an additional $10,000 a week. This collection is nothing less than money-laundering. It is corrupt. It is the stuff of FBI investigations and criminal indictments.”

Bernson spokesman Hal Dash strongly denied Thursday that the councilman took money illegally from Shappell or his firm. He said Bernson is not connected to the Shappell-PRIDE dispute.

In another letter to PRIDE, Silverman said, “Obviously, the accusation of unlawful payments to Mr. Bernson ‘implicates’ both the alleged recipient and the alleged payors, who reasonable jurors undoubtedly would understand here to be” Shappell and his company.

Birch could not be reached for comment Thursday. Silverman said he did not think that Birch read the statement aloud at the meeting, but submitted it for the public record. Silverman said his office obtained a copy of the statement from the city clerk the day after the hearing.

PRIDE attorney Joseph J. Brecher said Birch was not authorized to speak for PRIDE when the statement was issued. Before that, Birch often had been identified as PRIDE’s spokesman.

“He had been relieved of that position, especially since they knew what he was going to do” at the planning hearing, Brecher said. During the hearing, two other PRIDE leaders told reporters that Birch no longer was authorized to speak for PRIDE, Brecher said.

He said it “was a close question” whether the statement attributed to Birch was defamatory but in any event, “PRIDE didn’t say it.”

But Silverman said that on the same day as the planning hearing, Birch wrote a letter to the Los Angeles city attorney identifying himself as PRIDE’s “media coordinator.” He said Birch was an officer of PRIDE until last July.

“PRIDE cannot now conveniently disavow the actionable statements of Mr. Birch,” he said.

Silverman also said a PRIDE handbill is defamatory because it says the project will contain five times the commercial space of the Northridge Fashion Center and will be nearly as large as Century City. Silverman said Century City has 26 million square feet of commercial space--more than four times as much as Porter Ranch.

Brecher said even if the flyer contains factual errors, that in itself does not constitute defamation. Silverman also said a PRIDE fund-raising leaflet falsely asserted that Porter Ranch was “conceived in secret” by the city and that “the developer and his political allies . . . deliberately rejected all public input.”

He wrote to PRIDE on Feb. 6 that unless it immediately retracts the statements, Shappell “will pursue all of its available remedies.”

Brecher said the letter was an attempt to intimidate PRIDE and convince its leaders not to pursue an appeal of the lawsuit they lost against the development last December.

He said big developers often try to silence citizens groups with such legal threats, and “sometimes it works.”

Silverman also said an anonymous letter was submitted to the city Planning Commission that falsely labeled Shappell as “a Nazi collaborator.” Silverman said Shappell is a survivor of the Nazis’ Auschwitz extermination camp, and called the letter despicable.

He said he was not blaming PRIDE for the letter, but it showed “the depths to which some of the opponents of the Porter Ranch Specific Plan have sunk.”