Owners of the Ritz-Carlton, Half Moon Bay, and the Four Seasons in East Palo Alto allege they were “victims of a criminal real estate scheme” and have filed a complaint against a man they claim falsified a series of grant deeds.
The luxury hotel property owners are seeking the grant deeds be voided, according to a lawsuit filed on Sept. 9 in San Mateo County Superior Court.
In the suit, hotel owners allege Daniil Belitskiy recorded false grant deeds to transfer the titles of six properties owned by Strategic Hotels and Resorts to shell companies in Delaware with similar names. A grant deed is written evidence that states a person owns a property.
Los Angeles-based law firm Gibson, Dunn and Crutcher was hired to represent the property owners.
The complaint states the owners are seeking to prohibit Belitskiy and anyone associated with the shell companies from selling or transferring the properties. The suit alleges Belitskiy is tied to each of the six instances in which a false grant deed was recorded. This includes properties in Los Angeles, San Francisco and Orange counties.
The suit claims “to avoid detection” the shell companies used names similar to Strategic Hotel’s subsidiaries or affiliates. The defendants in the case have no connection to the property owners, according to Benjamin Wagner, partner with Gibson, Dunn and Crutcher. Wagner did not comment further on the ongoing litigation.
Strategic Hotels owns numerous luxury hotel properties throughout the state. A subsidiary of Strategic usually owns the real property with each hotel being operated by different management companies under different brand names.
On Aug. 19, 2004, Vestar-Athens/YCP II Half Moon Bay LLC executed a grant deed that transferred ownership in the Ritz-Carlton to SHC Half Moon Bay LLC. The grant deed was recorded with the San Mateo County clerk-recorder five days later, according to the complaint.
Belitskiy reportedly executed a grant deed on Sept. 5, 2018, purporting to transfer SHC Half Moon Bay, LLC’s ownership interest in the Ritz-Carlton to SHC Group LLC and AB Stable Group LLC. In the grant deed, Belitskiy claimed to be “vice president” of SHC Group LLC, which was portrayed as both the grantor and one of the grantees.
East Palo Alto Hotel Development LLC executed a grant deed transferring ownership in the Four Seasons to SHR Palo Alto LLC in March 2011. The grant deed was recorded in the county’s clerk office.
On Oct. 10, 2018, Belitskiy allegedly executed another false grant deed affecting the Four Seasons. The shell companies used by Belitskiy were knowingly recorded with the county clerk-recorder on Sept. 19, 2018, according to the complaint.
The property owners did not discover the existence of the grant deeds until May 12, 2019. Additionally, four of Strategic Hotel’s other subsidiaries are simultaneously filing action in San Francisco, Los Angeles and Orange counties to quiet title to the other four properties that were the subject of similar false grant deeds.
SHC Half Moon Bay and SHR Palo Alto are asking for declaration that they are “sole rightful holders” of the title for the Ritz-Carlton in Half Moon Bay and the Four Seasons in East Palo Alto. The complaint also asks for an injunction, prohibiting SHC Group, SHR Group and AB Stable Group and any affiliates from selling or transferring the properties.