Relevant Group sues Nourmand & Associates’ founder, alleging extortion over hotel projects

In a federal lawsuit, the Hollywood hotel developer accuses Saeed Nourmand and his team of demanding "ransom" payments to stop efforts to delay projects

Los Angeles /
Jun.June 12, 2019 02:03 PM
From left: Saeed Nourmand, Michael Nourmand, Grant King and Richard Heyman
From left: Saeed Nourmand, Michael Nourmand, Grant King and Richard Heyman

The Relevant Group has spent several years building a boutique hotel empire in Hollywood. But in a lawsuit filed in federal court, the developer claims the founder of one of Los Angeles’ best-known brokerages extorted it out of millions of dollars, nearly sabotaging the projects in the process.

Relevant is accusing broker and developer Saeed Nourmand of “extorting” the firm for millions of dollars, and allegedly claiming he said: “it’s going to take a check to make this go away.”

As part of suit, the company said that Nourmand collected money from Relevant through frivolous environmental complaints issues against its hotel projects. Relevant is also alleging that Nourmand has extorted competing developers for the same purposes. It alleges Nourmand pursued similar litigation against KOAR Institutional Advisors over its Schrader Hotel project, which is near Relevant Group’s Hollywood properties.

Relevant filed the suit in U.S. District Court for California’s Central District, claiming violations of the Racketeer Influenced and Corrupt Organizations Act, commonly called the RICO Act.

The suit also names Saeed’s son, Michael Nourmand, and the brokerage that Saeed founded in 1976, Nourmand & Associates. Michael Nourmand is now president of the brokerage.

Nourmand’s challenges to the Relevant projects were filed through Sunset Landmark Investment LLC, according to the suit. Sunset is an entity controlled by Saeed Nourmand, and headquartered at Nourmand & Associates’ Sunset Boulevard office. Saeed Nourmand was not available for comment.

In a text response to questions, Michael Nourmand said he is not involved with Sunset Landmark Investment LLC and that “there is no reason I or Nourmand & Associates should be mentioned in [a] lawsuit.”

He added, “I am not an owner or involved in Sunset Landmark, though I understand that Relevant is in a legal dispute with Sunset. They seem to have named me and Nourmand & Associates without basis, to try to damage our reputation.”

Nourmand & Associates’ Chief Financial Officer Mohamad Iravani is listed as a property manager at Sunset, according to statements filed with the California Secretary of State in May. Irvani is not as a defendant in the suit, and did not respond to a request for comment.

Starting in 2016, Saeed Nourmand “directly or indirectly” initiated challenges to three of Relevant’s proposed hotel projects in Hollywood: the Thompson Hotel, Tommie Hotel and Selma Hotel, according to the suit. Those were allegedly made through lawsuits and challenges within L.A.’s development appeals system.

The suit claims that Saeed Nourmand’s actions had nothing to do with environmental impact issues, and were instead designed to delay Relevant’s projects and extract payments in exchange for dropping the complaints.

Relevant claims that in early 2018 it paid what it called a “ransom” totaling $5.5 million to Sunset Landmark Investment to drop challenges to its Thompson Hotel and Tommie Hotel projects.

Nourmand allegedly went after the Selma project in the same manner, according to the suit, and on March 28, 2018, told a Relevant representative: “you know the drill, it’s going to take a check to make this go away,” according to the suit.

The city approved the Selma project in March.

The suit claims that Nourmand hired well-known environmental lawyer Robert Silverstein to pursue challenges through environmental statutes including the California Environmental Quality Act, a law commonly used to appeal development projects. Silverstein did not reply to an email seeking comment.

Relevant Group claims it has suffered “in excess of $100 million” in damages from the scheme because of delays to projects. The firm claims that the Nourmand-led challenge to the Selma project nearly derailed its construction.

 

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