Metropolitan News-Enterprise


Friday, January 2, 2015


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C.A. Affirms Judgment Based on Hotel’s Discrimination Against Jews


By a MetNews Staff Writer


The Court of Appeal for this district has upheld a $1.2 million award of actual damages and statutory penalties, plus $41,000 in costs, against a Pakistani Muslim and the corporation in which she serves as CEO, in favor of 11 youths who, because they are Jewish, she had routed out of the swimming pool of a Santa Monica hotel which the corporation owns.

Defendant Tehmina Adaya, CEO and part-owner of Indus Investments Inc., was present at the Shangri-La Hotel on Ocean Avenue in Santa Monica while a pool party, staged by the Young Leadership Group of the Friends of the Israeli Defense Forces (“FIDF”), was in progress. Evidence adduced at trial, and accepted by the jury, was that Adaya told the general manager, Nathan Codrey, “I don’t want any f—-ing Jews in the pool,” and remarked:

“If my parents find out that there is a Jewish event here, they’re going to pull money from me immediately.”

The opinion, filed Monday, also upholds a $11,250 award of general damages and $40,000 in punitive damages in favor of the company that booked the youths’ pool party.

Punitive Damages Stricken

However, the total $3.9 million judgment was pared by excising $405,000 in punitive damages from it, in favor of the youths, because the conduct giving rise to those damages was the same as that triggering penalties under the Unruh Civil Rights Act. The panel found no support for double punishment.

The opinion also places $2.1 in attorney fees awarded to the youths, pursuant to the Unruh Act, in the “maybe” category. That was because of the methodology used by Los Angeles Superior Court Judge Chester Horn Jr. in apportioning how much attorney time was spent on representing the 11 individuals, which was compensable, and how much time was devoted to advancing interests of the event-promotion company, which was not.

His apportionment was based on the percentage of total recovery, a methodology the appeals court branded as “arbitrary.”

Kitching Describes Incident

The unpublished opinion, by Justice Patti Kitching of Div. Three, recites what happened:

“Per Adaya’s instruction, Shangri-La staff systematically shut down FIDF’s pool party. Hotel staff singled out FIDF guests, identifiable by their blue wristbands, and removed them from the pool, while other hotel guests and non-guests were allowed to stay in the pool. Shangri-La staff required FIDF members to remove their banners. The staff locked the entrance gate to the pool to prevent FIDF attendees from entering or reentering the pool area. Pool staff removed the towels provided for FIDF’s event and had FIDF remove the t-shirts from the tables. Shangri-La security removed the ropes and stanchions that delineated FIDF’s private area at the pool. Staff also ordered all event attendees to remove their FIDF event t-shirts. Those FIDF event attendees who remained at the pool after the event was dismantled, were permitted to stay in the pool area. During this series of events, Adaya and her husband sat in a cabana next to the pool area and stared down the FIDF members for at least an hour to an hour and a half, generating a lot of tension between the parties.”

Hearsay Contentions

On appeal, Adaya insisted that the purported statement by her that she did not want Jews in her pool was hearsay. Kitching agreed that none of the plaintiffs heard the statement but, rather, either heard Codrey recite it, or heard of it from others third or fourth hand.

Codrey’s quotation of what Adaya said was not hearsay, Kitching declared. Hearsay, she noted, is “an out-of-court statement that is offered for the truth of the matter asserted,” and it was not being asserted that Adaya made the statement, but that Codrey caused harm by telling the plaintiffs that she did.

Kitching wrote:

“The purpose of Plaintiffs testifying to what they heard from Codrey was to show the effect of Codrey’s statement on the listener: to show that Plaintiffs understood that they were being removed from the pool due to their religion, which gave them cause for emotional distress. This nonhearsay purpose for admitting the testimony is highly relevant to proving general damages for emotional distress and mental anguish in Plaintiffs’ tort and Unruh causes of action.”

While the defendants raised a hearsay objection at trial to testimony as to what Codrey told listeners, they did not separately object to testimony as to Adaya’s purported statement being conveyed third- and fourth-hand, Kitching said. No objection to that testimony can be raised on appeal, she declared, because it was waived at trial.

Adaya Defended

Adaya—who, in addition to managing the hotel, is a music industry entrepreneur—has drawn a defense from Rob Eshman, editor of the Jewish Journal, a widely circulated weekly newspaper, who questions whether the jury got it right.

He wrote in the Sept. 10 issue:

 “1) No Jewish watchdog group has ever taken an active role in the Shangri-La case….

“2) There was never a boycott of the hotel by Jewish groups or Jewish customers. Bar mitzvahs, weddings and other Jewish events continue to take place there….

“3) Adaya herself was and is immersed in a world of Jewish friends and colleagues. She is the Westside-born-and-raised daughter of an Indian-born Muslim immigrant philanthropist, Ahmad Adaya. It’s not a case of ‘some of her best friends are Jewish.’ Adaya’s best friend was standing beside her when she was said to have unleashed her anti-Semitic invective. The best friend, Belinda Stampler Mercer, testified in Adaya’s defense—and Mercer is Jewish.

“4) There is significant reason to believe that whatever happened fell far short of real hate speech….Adaya did have her staff remove the FIDF banners, and get the partygoers out of the pool, because they were not hotel guests (though they were allowed to stay until the end of their event — some discrimination). That had to be a shock to people just out to have a good time, and doing it for FIDF, which is a worthy cause. They were angry. They wanted payback.”

He noted that Codrey was unavailable to testify at the trial and his deposition testimony was used.

The case is Paletz v. Adaya, B247184.

Marcellus A. McRae, Kahn A. Scolnick and Kimberly A. Nortman of Gibson, Dunn & Crutcher represented the defendants and James H. Turken and Christopher Kadish of Dickstein Shapiro argued for the plaintiffs.


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