Suit Involving Giant Names Finally Settled

A California judge awarded $6 million in compensatory and punitive damages to Allen Matkins’ client, Schwab family, in two high-profile libel suits. The multi-million dollar default judgement was entered against failed businessman Nicholas Behunin, after an unsuccessful smear campaign against the Schwab family.

The decision ended a ten-year legal battle and elaborate scam conducted by the defendant and his two companies. Behunin, who had already been found liable of attempting to defraud the Schwab family in a separate $15 million civil suit last year, failed to appear for a court-ordered deposition and other scheduled hearings over the last several months.

The decade-long legal saga stems back to a lawsuit filed by Nicholas Behunin against Charles and Michael Schwab in 2014, which came on the heels of Michael Schwab’s decision to stop investing in Behunin’s pursuit of a reef barrier construction project after he learned Behunin was misrepresenting his work and presenting fictitious contracts. A judge threw out the case in 2017 for lack of merit, with all claims against the Schwab family and their investment firm, Big Sky Venture Capital, being dismissed.  The Schwabs filed a countersuit against Behunin for fraud and breach of fiduciary, with a jury awarding the family $15 million in damages in April 2023.

Additionally, Michael Betz was quoted in the Los Angeles Business Journal on the outcome.

“It was quite an adventure,” said Michael Betz, a partner with downtown-based Allen Matkins Leck Gamble Mallory & Nastis who represented Michael Schwab for all 10 of the contentious years.

“It was a really nice ending, notwithstanding the fact that it was 10 years ago that the cases were first litigated,” he added. “Over the years, the legal system worked slowly, but justly.”

Read more about the decision in the Los Angeles Business Journal.