Laguna Beach temporarily closes 2 hotels after dispute over who operates them gets physical

Laguna Beach city officials closed two hotels after an ongoing dispute over who operates the businesses escalated to a physical confrontation and the destruction of hotel property.

The city issued a nuisance abatement order against the two properties after two groups of security guards argued on behalf of their disputing clients.

The 14 West Boutique Hotel and Hotel Laguna sit along Pacific Coast Highway less then two blocks apart in Laguna Beach. Both properties are owned by the same group of investors, which includes prominent Orange County real estate investor Mohammad Honarkar, who also manages the businesses.

Honarkar and the other investors are locked in a legal dispute over the management of the businesses and who operates them. The investor group, known as MOM CA, accused Honarkar of mismanaging the businesses, and he’s accused the group of misappropriating funds.

Their dispute came to a head Tuesday when a security group representing Honarkar arrived at the Holiday Inn Laguna Beach, another property operated by the group, around 6:30 a.m., according to a lawsuit filed by the investor group Wednesday in Orange County Superior Court.

Honarkar and the armed security guards stormed the front desk and seized key-card devices and employee laptops, the complaint says.

“They also turned off the internet, shut off security cameras, and proceeded to have locksmiths begin changing all door locks at the hotel,” the MOM CA group says in the lawsuit.

Honarkar and the armed guards also physically broke into at least one office, shattering the glass door to get inside, according to the court filing. He then sent other hotel staff home, notifying them that the hotel and adjoining restaurants were closed and would reopen the following day, the MOM CA group claims.

Hotel security guards were also on the premises, trying to stop the rival group of guards, according to the complaint.

Throughout the day, Laguna Beach police responded to the hotels for several disturbance calls, including reports of trespassing and a physical fight, according to a news release from the city.

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Attorney Marc Cohen, who is representing the MOM CA investors in their lawsuit against Honarkar, disputes the city’s claim that the hotel’s security guards were armed. He lays the blame on Honarkar’s security guards who arrived at the hotel Tuesday.

“These crazy people came in with guns like the Wild West,” Cohen said in an interview.

Isaac Zfaty, Honarkar’s personal attorney, said Honarkar was attempting to remove the hotel’s guards from the premises, because the investor group did not notify him that they would be working at the business that he manages.

“It was relatively peaceful,” Zfaty said.

He disputes the city’s claim that there was a brawl at the hotels.

The investors claim in their lawsuit that Honarkar and his security guards barred a representative from the group from entering Hotel Laguna. Security guards representing Honarkar also parked vehicles at the parking lot entrance to block anyone from coming onto the premises.

Video from the scene shows a group of men in security guard uniforms holding the hotel door shut as others shout in a chaotic scene.

Cohen said he was barred by security guards from entering the premises at one point and Zfaty, who was present, had to intervene to let him through.

The guards promised police they would remain civil, but a few hours later the same groups were involved in a 20-person fight at Hotel Laguna, according to the city.

One person struck another person, according to police.

Hadda Banayotis, 47, of Jurupa Valley was placed under citizens’ arrest on suspicion of battery, police told the Daily Pilot. Banayotis is a representative with the investor group, according to Zfaty.

Though the fight broke out over a civil dispute, police responded because the security guards were armed and intervention was required “for the protection of the public and all concerned,” Laguna Beach City Manager Shohreh Dupuis said in a written statement.

Attorneys for both parties agreed to terms set by the city, including having the security guards remove their weapons at both hotels by 6 p.m. The parties could not agree on the condition to close the hotels, Dupuis said.

But police were called back to the 14 West hotel two more times after 6 p.m. Police found armed guards at both hotels around that time, according to the city. Cohen denies that any of the hotel guards were armed.

Zfaty could not say if any guards were armed after 6 p.m.

Laguna Beach issued the nuisance order to close the hotels until “the threat to public health and safety no longer exists.”

Police Chief Jeff Calvert said both parties were warned, but neither were willing to give up in the dispute on who operates the businesses.

“Immediate closure of the businesses will allow a cooling off period for both parties and protect the public from inadvertently being caught up in the middle of a civil issue that has the potential to become more violent,” Calvert said in a written statement.

Laguna Beach Mayor Bob Whalen told the Daily Pilot the hotels will be closed as long as they remain a “public safety threat.”

“I can’t predict the future, but it would be very helpful if a judge were to clarify it for us and say the rightful operator of these hotels is whoever it is,” Whalen said.

Both sides are seeking emergency orders in court and are expected to appear before a judge in Orange County on Friday.