LIHUE — Carlos Andrade, a retired history professor and partial heir to several small land parcels on Mark Zuckerberg’s North Shore estate, outbid a group of his distant relatives during a court hearing on Tuesday, purchasing all four of the contested lots for just over $2 million.
Ownership of the kuleana has sparked a years-long legal dispute involving hundreds of parties that has made international headlines and prompted a public apology from the Facebook CEO, who promised to drop his pursuit of the land in a 2017 letter published in The Garden Island.
Andrade bought three of the four kuleana — family-owned parcels of land passed down through successive generations — at a public auction in March. The remaining lot went to a small contingent of his extended family members.
That auction was one of the final steps in a lawsuit filed by Andrade in 2016 to partition the land and “quiet” the titles, placing each of the properties under a single owner, instead of leaving them divided among hundreds of people descended from a Portuguese immigrant, Manuel Rapozo, who bought the land over a century ago.
The hearing in Fifth Circuit Court was held to finalize the results of the auction, but Hawaii’s quiet title laws allow interested parties to reopen bidding at confirmation hearings like the one held Tuesday. Anyone who submits a legitimate offer that is at least 5% higher than the winning bid can override the results of the auction and buy the land.
That’s what happened on Tuesday. Andrade’s lawyer, Harvey Cohen, told the court his client intended to place a bid on the kuleana he was seemingly unable to afford two months ago, when he declined to top a $700,000 bid by the group of his family members.
Attorneys for the two parties — Cohen represented Andrade and Lihue attorney Craig De Costa acted on behalf of the Rapozo descendants — convened in the hallway outside Fifth Circuit Judge Kathleeen Watanabe’s courtroom along with the land commissioner, Patrick Childs, and the auction started all over again. This time, Andrade won all four.
Cohen’s opened bidding on the first lot — the kuleana he had previously been outbid on — for $735,000. It went uncontested. A contest for the second plot of land, which had gone for $300,000, ended when Cohen bid $500,000. De Costa declined to contest the $460,000 sale price of the third lot. Cohen bought the final parcel — it had sold for $300,000 at auction — for his client with a $450,000 bid.
When the dust settled, Andrade had consolidated his hold on all four of the kuleana for a combined total of $2.1 million, more than double the amount he paid at the public auction roughly 10 weeks ago.
How exactly the retired college professor put together over $2 million remains a point of contention. De Costa and his law partner, Daniel Hempey, say they have compiled significant evidence to show that Andrade’s bids and legal fees were in some way financed by Zuckerberg or an LLC he controls.
They submitted a motion to that effect in the quiet title case, essentially alleging that Andrade was able to force the sale of the land and then purchase it using funds that otherwise should have been distributed among the hundreds of people with claims to the land.
Hempey and De Costa also filed a separate lawsuit the day after the auction in March on behalf of two of Andrade’s distant cousins — Wayne Rapozo, a London-based attorney with an ancestral claim to the land who helped to coordinate and finance the legal battle opposing the land partition, and Shannon Buckner, who also has a small share in the kuleana. That lawsuit alleges Andrade violated court procedure by colluding with a Zuckerberg-controlled company during the quiet title legal proceedings.
Following the hallway bidding battle on Tuesday, Hempey asked Judge Watanabe to deny confirmation of the land sale on the grounds that Zuckerberg paid Andrade at least $645,000 over the past six years, a transaction Hempey said “fundamentally skewed the auction.”
Hempey also argued that a corporation controlled by Zuckerberg intentionally initiated the quiet title claim less than 24 hours before a new Hawaii law took effect that would have afforded his clients substantially greater rights in defense of the land partition process.
Cohen adamantly denied that Andrade engaged in anything untoward, insisting the allegations made against his client, who he describes as “the constant gardener,” due to his almost daily use of the land, are being made by “a very vocal minority that are raising issues at the eleventh hour.”
Hempey’s claims were largely echoed by Jordan Inafuku, an attorney representing another small group of Rapozo descendants. Inafuku asked Watanabe to at least continue the confirmation of the land sale until further research into the source of Andrade’s finances can be conducted.
Watanabe denied the requests to delay or deny the court’s decision. She pointed out that the court has previously dismissed similar claims during the course of the lawsuit, which began well over two years ago. She concluded the hearing by confirming the sale of the land, officially making Andrade the sole owner of the four kuleana.
Litigation, however, is far from concluded. A separate lawsuit has been filed against Andrade, asking the court to force him to distribute the money he was allegedly paid by Zuckerberg to essentially keep people off the kuleana. And although Watanabe confirmed the sale, she did appear agreeable to hearing further arguments regarding how Andrade obtained the $2.1 million, an allegation which, if true, could require him to distribute the money to the kuleana shareholders.