A designer prevails in court after two architects discover discover a knockoff of their company's $20-million dream home.
By Martha Groves, Times Staff Writer
Real estate mogul Fred C. Sands thought he had commissioned the design for a $20-million Bel-Air dream house that would be like no other.
Then two years ago, a couple of architects took a fateful drive down a winding street about seven miles away in Beverly Hills.
At a construction site on Marilyn Drive, one architect remarked on the fine detailing on a pediment piece over a doorway. Inside, the two found striking similarities to the Tuscan-style villa that their boss, William Hablinski, had just spent more than 3,800 hours over 1 1/2 years creating for Sands.
"This was a jewel box, our jewel box, and somebody ripped it off," Sands said. "Hablinski promised us this would be one of a kind."
Outraged on his own and on behalf of his clients, Hablinski filed a lawsuit against the builders and owners of the Beverly Hills property. Referring to the Beverly Hills property as the "copycat house," the suit alleged copyright and trademark infringement, unfair competition and other complaints.
After a three-week trial in Los Angeles, a six-person jury ruled last week in Hablinski's favor and awarded him nearly $6 million. The jury found that the defendants conspired with a former Hablinski employee to copy plans for the Sands house and use them to build the Beverly Hills home.
The case of the copycat house has played out against the backdrop of the heated, extravagant world of Westside real estate, where many homeowners pay stratospheric prices to hire the architect of the moment. (Hablinski has created custom designs for Arnold Schwarzenegger and Maria Shriver, Warren Beatty and Annette Bening, as well as Jennifer Lopez and Jim Carrey.)
The suit sought to test the limits of the 1990 Architectural Works Copyright Protection Act. Designed to help bring the United States into compliance with the Bern Convention, an international copyright agreement, the law extended copyright protection to buildings.
A fair number of lawsuits alleging architectural copyright infringement have been filed involving commercial projects.
Such cases on the residential side, against homeowners, have been far more rare. Peter J. Bezek, Hablinski's attorney, said this was the only case he knew in which a homeowner was found to have infringed on the works of an architect.
Bezek said the verdict sets an important precedent for architects who devise original concepts for clients because it "protects that architect all the way through to the end user. If you build from an infringed set of plans and you have the â€¦ ability to control the architect and you had a financial interest in the process, you're liable whether you knew or didn't know [that the plans were stolen]."
Hablinski said he was elated by the outcome. "We live in a highly technological age," he said. "Two or three years of work can be pirated at the stroke of a key."
Hablinski said he was stunned when the two architects who discovered the "copycat house," Dave Hogan and Richard Giesbret, told him about their trip to Beverly Hills.
"We were extremely surprised and extremely disappointed and, frankly, quite demoralized that this could have happened to us," he said.
After happening upon the Beverly Hills house two years ago, Hogan and Giesbret looked at floor plans that a worker had laid out. The size of the sheets appeared to be identical to the plans for the Sands residence. Hogan also noticed that a logo and website for MSH Design appeared in the same place where the William Hablinski Architecture logo was positioned on the original Hablinski drawings. MSH Design is the firm of Mehran Shahverdi, who once worked for Hablinski.
Two days later, Giesbret visited the Beverly Hills building department to review plans for the Marilyn Drive mansion.
One page contained the code name for the Sands residence, Unity Family Trust. The owner-builder building permit listed Parviz Elihu as the applicant and Amir Construction, owned by Parviz and his brothers, as the general contractor.
Amir, Hablinski learned, had formerly employed Shahverdi. Joseph Elihu was listed as the house's owner.
According to Hablinski's complaint, Joseph Elihu was president of EuroConcepts, another Elihu-owned company, which won the bid to supply some kitchen and bathroom fixtures for the Sands house. Both companies were named in the suit.
In addition to Parviz (known as Perry) and Joseph, the suit named their brothers Daniel and Albert. It also named Joseph's wife, Hayedeh Elihu, who now occupies the Marilyn Drive house with him.
In a telephone interview Tuesday, Sands recalled how he testified in court that he once visited the EuroConcepts showroom in the Pacific Design Center. One of the Elihus came out to greet him and said: "Great house."
Bezek said the plaintiffs were able to find evidence by sifting through Shahverdi's seemingly burned-out computer.
A specialist in Texas was able to salvage a portion of the burned hard drives, Bezek said. On them Hablinski's legal team found incriminating e-mails and "the DNA that came from Hablinski's CAD (computer-aided design) drawings that were traced all the way through to the copycat house drawings."
The jury ultimately found that the "overall composition" of the two houses â€” including the placement and size of chimneys, balconies, doors, windows and a series of rear archways â€” was almost identical.
The verdict came to about $5.9 million. Under a simple mathematical formula that applied in this case, Hablinski has the right to take the profit from the house that was built from the pilfered plans.
The Beverly Hills house was determined to have a fair market value of $14 million. Once the value of the land, the cost of construction and other costs were subtracted, the "profit" on the house was determined to be about $5 million.
Hablinski also was eligible to receive $380,000 as the value of his plans and $500,000 for damage to his reputation.
Bezek's advice to individuals seeking to build a custom home: "Make sure you're dealing with someone reputable and who is designing a house just for you."
An attorney for the Elihus said the defendants planned to appeal but also were discussing a settlement with Hablinski.
"My clients are disappointed with the jury verdict," said Jim Hicks, the attorney.
"They believe they will prevail on appeal. In the meantime, we're trying to resolve this with plaintiffs."
He declined to comment further, saying he felt constrained by the settlement talks.
About a year ago, Sands and his family happily settled into their Bel-Air home on Moraga Drive.
Still smarting from the copycat experience, Sands said Tuesday that he was contemplating a suit of his own. For his part, Hablinski said he might consider sharing the proceeds of the case with Sands.
"That remains to be seen," he said. "We'd have to see what all the legal particulars are."
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