Martins Beach: Billionaire Vinod Khosla loses bid to halt state lawsuit seeking more public beach access

In a significant development in the long-running battle over whether Silicon Valley tech billionaire Vinod Khosla can limit public access to Martins Beach, a scenic stretch of sand south of Half Moon Bay, a judge has rejected Khosla’s attempt to throw out a lawsuit by state agencies that claim he has been “improperly and illegally” restricting public access to the popular beach for more than a decade.

Late Thursday, San Mateo County County Superior Court Judge Raymond Swope issued the decision.

The ruling by Swope, an appointee of former Gov. Arnold Schwarzenegger, is a loss for Khosla. It means that the lawsuit, filed in 2020 by the California Coastal Commission and the State Lands Commission, will proceed to a trial, scheduled for April. That trial could result in Khosla being forced to remove no trespassing signs and to take down a gate that he has used to block the only road leading to the waterfront since 2010.

“We continue to think that public access here is of huge value,” said Lisa Haage, chief of enforcement for the Coastal Commission, a state agency based in San Francisco. “Martins Beach is an iconic and gorgeous place. There has been long-term public use and it means a lot to the community.”

Jeffrey Essner, a San Jose attorney representing Khosla, did not respond to requests Friday for comment.

Khosla, 69, of Portola Valley, is a venture capitalist and the co-founder of Sun Microsystems. He has a net worth of $7.3 billion, according to Forbes.

The fight over the sandy beach on the San Mateo County coast has gained nationwide attention. Khosla has called it a case of private property rights, while political leaders, surfers and environmentalists have said the issue could set a precedent about whether California’s beaches can be closed off by wealthy landowners.

The standoff began in 2008, when Khosla purchased 88 acres of coastal land along Highway 1 that surrounds the beach that had been used by families for generations for $32.5 million. Two years later, he locked the gates, hired guards and posted no trespassing signs.

Surfers and environmental groups protested. They noted that because the beach, which is public along the water line under the Coastal Act, is flanked on both sides by steep cliffs, the road is the only way to access it.

“According to the courts, the right to exclude others is the most valuable right in the “bundle of rights” that constitutes property,” Khosla wrote in a 2018 online post.

The Coastal Commission told Khosla that he must apply for a permit to lock the gate. The Surfrider Foundation, a non-profit group, sued him over the issue. After he lost that case in the lower courts, he appealed to the U.S. Supreme Court, arguing that the state’s landmark Coastal Act, approved by voters in 1972, was “Orwellian” and unconstitutional.

In 2018, the U.S. Supreme Court refused to take the case. The justices left in place lower court rulings that found Khosla could not lock the gate across the half-mile-long road without a permit from the Coastal Commission because the Coastal Act requires permits if landowners change public access to beaches.

Since then, Khosla’s managers have opened the gate during some times of the week, and charged a $10 parking fee. Many surfers and beachgoers park along Highway 1 and walk down the road to the beach to avoid paying.

“We often see it open, but quite often we also see it closed,” said Ed Larenas, 72, a Moss Beach resident who has been surfing at Martins Beach for 40 years. “People drive over here and they don’t know if it is open. It’s random. And people with disabilities, older people and people with children can’t walk all that way to the beach.”

In the current lawsuit, the Coastal Commission and the State Lands Commission contend that generations of families who used the beach and the road leading to it before Khosla’s ownership guaranteed an irrevocable public right of access under long-established legal precedent that he cannot revoke.

To bolster their case, the Coastal Commission collected photographs, letters, journal entries and other evidence from more than 230 families who used the beach dating back to the 1920s for picnicking, fishing, swimming and other recreation.

In 2018, Khosla won a separate case involving similar issues that was filed by a non-profit group called Friends of Martins Beach. But the state agencies, their legal firepower, and their family history evidence were not part of that showdown.

In that case, the First District Court of Appeal in San Francisco ruled that because beach-goers paid parking fees in the past to the property’s previous owner, a public right to the road had not been established.

But the agencies behind the latest lawsuit say their evidence upends that argument. The previous owners, the Deeney family, and their business partners, the Watt family, didn’t consistently collect parking fees until the 1960s or 1970s, the current lawsuit alleges. Even after that, the suit says, people regularly used the road for years without being charged. Further, when it was collected, the fee was to park a vehicle, not to access the beach, so the fees “did not amount to a restriction on public use,” the state’s lawsuit claims.

Khosla had argued that the current case should be thrown out because the underlying issues were already decided in the Friends of Martins Beach case six years ago.

But Judge Swope disagreed. He noted in Thursday’s ruling that the Coastal Commission and the State Lands Commission were not parties to that lawsuit. And he wrote that the state showed evidence that before Khosla bought the property in 2008, San Mateo County officials told his property manager, Steven Baugher, that there was public access to the beach and that it “will have to remain.”

“We are always open to trying to settle this case,” the Coastal Commission’s Haage said Friday.