When Facebook’s co-founder Mark Zuckerberg paid around $100 million for 700 acres of rural beachfront land on Kauai two years ago to create what Forbes magazine described as a secluded family sanctuary, he actually acquired a not-so-secluded property.
Close to a dozen small parcels within Zuckerberg’s Kauai estate are owned by kamaaina families, reports The Honolulu Star Adviser.
Now the Facebook CEO is trying to enhance the seclusion of his property by filing several lawsuits aimed at forcing these families to sell their land at a public court auction to the highest bidder.
The legal action known as “quiet title and partition” isn’t uncommon in Hawaii. Yet even with an order from a judge and financial compensation, forcing people to sell land that has been in their families for generations can be off-putting — especially when it’s driven by the sixth-richest person in the world.
“The person being sued is ultimately on the defensive,” Donald Eby, a real estate attorney and partner in the Colorado law firm Robinson & Henry, told The Honolulu Star Adviser. “Their ownership is being challenged, and because of that their ownership is put at risk.”
Zuckerberg, through several companies he controls, filed the lawsuits against a few hundred people — many living and some dead — who inherited or once owned interests in what are known as kuleana lands where ownership is often largely undocumented.
A contested case with many owners can cost $100,000 or $200,000 or more. For someone to use the law to not only establish title, but to also force a sale requires that they have an ownership claim. For some of the Kauai land, Zuckerberg has done this by purchasing interests from several part-owners.
Three Zuckerberg companies — Pilaa International LLC, Northshore Kalo LLC and High Flyer LLC — filed eight quiet title lawsuits Dec. 30 in state Circuit Court on Kauai.
Defendants have 20 days to respond to the legal complaint after being served with a copy. If they don’t respond, they get no say in the proceeding. If they choose to participate, it could be expensive if they want to be represented by an attorney.
In the past, quiet title auctions have been known to result in below-market sale prices even though judges can reject a high bid that they deem grossly inadequate. But some involved with the Kauai cases expect that Zuckerberg, who Forbes said had a net worth of $44.6 billion last year, will offer a fair price.