How a ‘family’ deal over 170 buildings unraveled in court
A California family’s $6.85 billion fight over a billion‑dollar apartment portfolio has been cut back on appeal – and the timing and paperwork matter.
On February 24, 2026, California’s Second District Court of Appeal, Division One, issued a published decision in a long‑running dispute between the Jogani brothers, a family involved in a global diamond business and a substantial Southern California apartment portfolio.
For mortgage and real estate professionals, the case reads like a cautionary tale about handshake‑style deals, control of holding companies and how large damages can become when relationships collapse.
Here is the basic setup. Four brothers – Haresh, Shailesh, Rajesh and Chetan Jogani – operated what the court described as a global diamond partnership. A fifth brother, Shashikant “Shashi” Jogani, went his own way and began investing in residential apartment properties in Southern California in the mid‑to‑late 1970s. Within about 10 years, his portfolio had a fair market value of $375 million, with equity of approximately $100 million.
Then came a real estate downturn and the 1994 Northridge earthquake. Several of Shashi’s properties were damaged, one 164‑unit building (Northridge Meadows) collapsed, tenants and creditors sued, and the equity in his holdings became negative. His lawyers advised him to keep and grow the portfolio by partnering with an investor rather than exiting.
Shashi negotiated with outside investor Richard Julian on a structure where Shashi would place his properties into a partnership, Julian would lend money for additional purchases and operations, and after repayment of the loan plus interest (between 10 and 15%), ownership would be split 50/50. Julian testified he signed that proposed agreement but later learned Shashi had chosen to enter a deal with his brothers instead.
In April 1995, after several days of discussions in Los Angeles, Shashi, Haresh and Rajesh reached an oral agreement that mirrored the Julian proposal, except that the interest rate would be 12%. Shashi called his attorney, Steven Glass, to his house. In the presence of Haresh and Rajesh, Shashi described the terms: his existing properties would go into a partnership structure; Haresh would loan money for additional acquisitions and improvements and operate through entities; Shashi would manage and grow the portfolio; and once the loan and interest were repaid, Shashi would hold a 50% interest in the real estate partnership. According to the court, Haresh did not object to anything Shashi said.
Following the agreement, Haresh formed two British Virgin Islands holding entities, Mooreport Holdings Limited and Gilu Investments Limited. Shashi formed California‑based entities – J.K. Properties, Inc. (JK), H.K. Realty, Inc. (HK), Commonwealth Investments, Inc. and Hansa Investments, Inc. – and transferred title to his properties into the California entities without compensation. Because Shashi would not be a partner until he repaid the loan, his attorneys drafted a consulting agreement naming him as a consultant for JK to demonstrate to third parties that he had authority to negotiate on the partnership’s behalf.
By 2001, Shashi had acquired approximately 170 apartment buildings worth about $1 billion for the real estate partnership. Between 1999 and September 2001, he paid what the court described as the balance owed to his brothers: $43 million in principal and $27 million in interest.
In October 2001, Shashi asked Haresh to put his name on the titles of all the real estate partnership entities and to distribute $4.8 million to the partners. Haresh initially refused to permit the distribution and delayed adding Shashi to title, citing tax concerns. Haresh eventually distributed $2.4 million to Shashi but canceled issuance of stock to him, locked him out of the companies, told employees they could no longer take direction from Shashi, and told Glass that he was the sole director of the entities and the only person from whom Glass should take direction.
Shashi sued in February 2003. Over the years, the case generated a series of appellate opinions and related proceedings. Early on, Chetan and Rajesh signed declarations disclaiming any real estate partnership and were dismissed. At trial, they later testified Haresh had economically coerced them to sign and privately assured them everyone would receive their shares once Shashi’s case was over.
The main trial in this case ran from September 18, 2023 to February 26, 2024. The jury found in favor of Shashi on breach of contract, breach of fiduciary duty and intentional misrepresentation. It found that Shashi, Haresh, Rajesh and Chetan were partners in the real estate partnership, that Mooreport, Gilu, JK, HK and Commonwealth were beneficially owned by that partnership, and that the partnership percentages were: Shashi 50%, Haresh 24%, Rajesh 10%, Chetan 6.5% and Shailesh 9.5%.
The jury awarded Shashi economic damages of $1,798,846,000 and found Haresh acted with malice, oppression and/or fraud. For Chetan and Rajesh, the jury awarded $233,849,980 and $359,769,200, respectively, for their real estate partnership claims and $65,000,000 and $100,000,000, respectively, for their diamond partnership claims. On March 7, 2024, the jury awarded punitive damages of $1,500,000,000 to Shashi, $1,050,000,000 to Chetan and $450,000,000 to Rajesh.
After additional proceedings, the trial court entered judgment on May 9, 2024 against Haresh totaling approximately $6.85 billion, including the jury awards and prejudgment interest. A second amended judgment was entered on October 24, 2024.
On appeal, the court largely backed the trial judge. It upheld the determinations that an oral real estate partnership existed, that the identified entities were beneficially owned by that partnership and that Haresh’s denial of any partnership was not credible. It rejected challenges to evidentiary rulings on discovery‑related inferences about missing records, prior consistent statements from third‑party witnesses who said Shashi had described the deal years earlier, Gujarati‑English translations of recorded meetings and testimony from former joint attorney Glass.
One damages issue, however, did not survive. Shashi’s forensic accounting expert had testified that a 2008 realized investment loss of $445,181,000 on investments sold during the 2008 housing/financial crisis would have grown to $1.98 billion if the investments had not been sold and had instead appreciated in line with the S&P 500 index. The jury’s economic damages award for Shashi included his claimed 50% share of that $1.98 billion figure, and Chetan’s and Rajesh’s real estate partnership awards likewise reflected their respective partnership shares.
The Court of Appeal concluded that this “lost profits” or “lost gains” opinion had not been properly disclosed before trial. While the $445 million loss itself appeared in the expert’s materials, the projection to a $1.98 billion figure based on the S&P 500 had not been fairly set out in expert discovery. That failure, the court held, meant the defense did not receive adequate notice to respond.
The appellate court issued a conditional ruling. It vacated the jury’s economic damages awards relating to the real estate partnership and ordered a remittitur removing the $1.98 billion investment‑gain component. If accepted, Shashi’s economic damages relating to the real estate partnership are reduced to $808,846,000, Rajesh’s to $161,769,200 and Chetan’s to $105,149,980, with any necessary corresponding reduction in prejudgment interest. If any of them does not consent to the reduction, that person is entitled to a new trial limited to his economic damages arising out of the real estate partnership and his punitive damages. The judgments and orders are otherwise affirmed.
For people in the mortgage and real estate finance space, the Jogani case shows that when an oral “family” arrangement ends up controlling a large portfolio held through multiple entities, courts will dissect ownership, roles and damages with the same scrutiny they apply to fully documented institutional deals.
