According to court records, a group of landowners claims that a Silicon Valley-backed business attempting to construct a sustainable metropolis northeast of San Francisco used unfair and “strong-armed” tactics to push farmers to sell their land, including putting family members against one another. The information was revealed on Friday as part of a lawsuit brought by the company, Flannery Associates LLC, in District Court in Sacramento in May, alleging that numerous farmers collaborated to inflate the value of their land by $170 million. The landowners refute the claim and are attempting to have the suit dismissed.
Flannery pushed farmers who did not want to sell to give up their land, forced property sales by evicting farmers and terminating leases
The latest allegations, contained in a report on a conference held by both parties in September, provide the most comprehensive account of the landowners’ accusations against Flannery to date, with backing from former Sequoia Capital Chairman Mike Moritz, LinkedIn co-founder Reid Hoffman, and venture capitalist Marc Andreessen, among others. According to the petition, the defendants claim Flannery pushed farmers who did not want to sell to give up their land, forced property sales by evicting farmers and terminating leases, misled landowners, and used the exorbitant expenditure of litigation to compel them to sell.
In an email to Bloomberg, a Flannery spokeswoman stated that the business has specific evidence of price-fixing, that it has given acceptable settlements to individuals, and that it is willing to deal with the remaining defendants. According to the defendants, in one case, seven of eight landowners in the same family wanted to continue farming, but one wanted to sell. According to the petition, Flannery then reportedly used a “divide-and-conquer” strategy, purchasing a one-eighth share and suing the other seven family members to gain the remaining shares.
To date, the Delaware-based firm has spent around $800 million to acquire at least 52,000 acres of agricultural land
To date, the Delaware-based firm has spent around $800 million to acquire at least 52,000 acres of agricultural land, making it the area’s largest landowner. It is suing the landowners for $510 million in damages, or triple the amount supposedly owed. The New York Times and other media sources unveiled the company’s plan to establish a new city named California Forever, a walkable, green community that would create thousands of jobs, in late August. Jan Sramek, a 36-year-old former Goldman Sachs trader, is in charge of the initiative. Some local city leaders and lawmakers have expressed their displeasure with the lack of transparency in the process.
