Caught on Tape
In May of last year, Shoma paid $39 million for the former Ryder System headquarters in Doral. Masoud Shojaee, president of Shoma Development, had ambitious plans for the 45-acre property -- a pedestrian-friendly town center that would combine 900 residential units with 200,000 square feet of retail space and 150,000 square feet of office space. Only one problem: The property wasn't zoned for that.
Shojaee essentially had taken a $40-million gamble that the newly minted City of Doral would approve the planning and zoning changes needed to fulfill his vision. He consulted with one of Shoma's lawyers, Stanley Price, a prominent Miami land-use attorney. At least one of those consultations took place over the phone. Participants were Shojaee, Price, and an unidentified third party associated with Shojaee.
It seems one of the three men inadvertently caused that three-way conversation to be recorded on the voice mail of a bureaucrat who works for a local public agency. Exactly how it happened is unclear, but it's likely one of the men had called and left a voice-mail message for the bureaucrat, neglected to hang up or shut off his phone, and thus allowed the ensuing Shoma-Doral conversation to feed into an outsider's voice mail. A confidential source provided New Times with a copy of the taped conversation, which probably took place in May or June 2004. A transcript follows below. It lasts only 65 seconds, but it speaks volumes.
Stanley Price: Doral does not have their own filing system.
Masoud Shojaee: Right.
Stanley Price: So we need to file with Dade County. That's -- but I want to meet with the city manager to get --
[ Tape gap ]
Stanley Price: Importantly, we gotta get Ralph to champion this thing through for us. Okay? Ralph, Ralph is the, ah, 2000-pound gorilla in Doral.
Masoud Shojaee: Okay, let's, uh, tell Ralph, uh, Felix come to the office, uh, on Friday morning.
Masoud Shojaee: Okay?
Stanley Price: Have a check for him 'cause he's, he's very hungry.
Unidentified: Yeah, I know he is. Stanley, did you discuss any fees with him? Because I remember this agreement he was going to discuss with Stanley. Remember, Masoud?
Masoud Shojaee: Yeah.
Unidentified: Did you guys have a fee arrangement?
Stanley Price: Yeah, he, he wanted $50,000 and I said you'll take $20,000 and you'll get a, get a bonus of $30,000 when the zoning's delivered to us. And that's a tremendous payday for him.
Masoud Shojaee: Okay, he agreed?
Stanley Price: Yeah.
Masoud Shojaee: Okay.
Unidentified: Okay. Stanley, you don't have that agreement drawn up, do you?
Stanley Price: No, it's a uh, I'll tell you what, I'll pull the, uh, I'll pull the prior agreement he did with uh, with uh --
[ Tape gap ]
Masoud Shojaee: Thanks.
Stanley Price: Bye, bye.
"Doral does not have their own filing system"
At the time of the taped conversation, the City of Doral was only a few months old and had not yet created its own planning and zoning department. Nor had it developed its own comprehensive master plan. Thus it could not process requests for planning or zoning changes, which Shoma Development Corp. needed for the Ryder property.
"So we need to file with Dade County"
From its first day as a city, June 24, 2003, until this past October 1, Doral relied on Miami-Dade County's existing master plan and zoning laws. The new city also relied on the county bureaucracy to process any requests for changes brought by Doral property owners.
"We gotta get Ralph to champion this thing through for us"
Ralph Arza is a state representative whose District 102 includes parts of Miami-Dade and Broward counties, but not the City of Doral. Arza, however, is widely acknowledged to be a powerful political force in Doral (see "Meet Mr. Arza," New Times, March 24, 2004). A major project like that proposed by Masoud Shojaee would need the support of the Doral City Council. Obviously Stanley Price saw the advantage of having someone like Arza "champion" the project, though in what manner remains uncertain.
"I said you'll take $20,000 and you'll get a bonus of $30,000 when the zoning's delivered to us"
If Ralph Arza were to lobby public officials on behalf of the Shoma project, by law he would be required to register as a lobbyist. He is not a registered lobbyist in any Miami-Dade municipality. Under county law, lobbyists are not allowed to receive contingency or "success" fees, which the law defines as a "bonus, commission, or nonmonetary benefit as compensation dependent on ... the passage, defeat, or modification of an action or decision by the county commission or any of the elected bodies governing the municipalities." State law prohibits lobbying on zoning matters because they are considered quasi-judicial proceedings. Arza says he was never hired by Shoma and does not lobby local governments.
After listening to the tape recording, New Times sought clarification from Stanley Price, Masoud Shojaee (pronounced SHOH-jee), and Ralph Arza. Initially Shojaee and Arza declined to listen to the tape or answer questions about it. Price was more cooperative and agreed to be interviewed. New Times later faxed questions to Shojaee and Arza, as well as followup questions to Price. Shojaee and Arza responded to those queries (see "Questions and Responses"), but Price did not. Subsequently an attorney representing Price sent New Times a letter titled "Demand to Cease and Desist and for Delivery of the Illegal Tape Recording." (See "Cease and Desist")
The interview with Stanley Price, which was monitored by his colleague Brian Adler, took place at their downtown Miami law office Monday, April 4. Below is a verbatim transcription of that interview.
The Stanley Price Interview
Stanley Price: Frank, I -- I will tell you I am very upset about having some phone conversation/line tapped. It's illegal.
Francisco Alvarado: That's totally understandable. I'm just here to let you know that I don't know the source of it, but I can tell you that we did receive it legally. The circumstances of how the tape was made, is I guess --
Price: Well, I'm not doubting -- I'm saying the tape itself is illegal. You, you can get stolen goods too and you may have received them as a gift, but they're still stolen goods. But let me hear the tape.
Here's a transcript of the tape so you can follow along and hear the tape.
Price [upon hearing his voice on the tape]: That's me.
[Tape continues to end]
And that's it. That's, um, you can have that copy. That's for you.
Basically, I mean, we got the tape. As far as we know, Rebecca Wakefield received the tape at the office is all I can tell you. And I can tell you that my boss says we got this legally. And that's Jim Mullin, our editor.
Price: What does that mean?
Well, I can't -- I don't, I can't tell you anything else other than that.
Price: You, you have to understand the context of what this is about.
And that's why I'm here -- to ask you the context of it.
Price: What happens is that Shoma Homes purchased the Ryder property. The Ryder property is a large piece of property, uh, owned by Ryder Corporation; they had their corporate headquarters on that property. The property was part of a development of regional impact. What Shoma wanted to do with the property is to convert the property into a town center which is a mixed-use type of development to include residential, uh, retail, office, and perhaps some public amenities such as public buildings. Uh, when we were discussing what is the best way of getting this through in regard to Doral, Ralph Arza's name came up. Ralph used to be the chairman of [the community council] at Doral. Uh, Ralph is very, very close with the members of Doral [City] Council. And I advised Shoma that they would have to file a comprehensive-master-plan amendment. But at the time we were going to do this, jurisdiction was with Dade County. And the question is: How do we best get this thing expedited because Masoud [Shojaee] had to close on this property very quickly.
[Price's cell phone rings]
Price: Give me a second. Hello? Yes, Masoud, how are you? Good. Am I awake? That is an interesting question. In about an hour I will be awake. Yes. I'm, I'm still here at the restaurant. And I, I assume you are not coming. Yeah, let's play golf. Can I call you back? Are you at the office? I'll call you at work. Okay. Bye-bye. Sorry.
I'm sorry -- jurisdiction, you said the county had it?
Price: And the thing is Masoud had closed on the property. So we needed a degree of certainty whether this mixed-use concept was going to be accepted. And Masoud said, öWho is very well connected in Doral who can get us a read on this thing?' A couple of names talked about, but the name I use the most often is, um, Ralph Arza. Uh, so we had this conversation. Apparently Masoud met with him and decided that we did not need his employment. In fact he did -- he never hired him on this property. The reason for that is we submitted a proposed conceptual plan. We are using the services of Bernard Zyscovich, considered one of the better land planners in the county. We showed the New Urbanism plan to uh, Terry Nagel [Doral's community development director]; to Henry [Eiler], who is the outside consultant to the city; and as well as to one or two of the commissioners. Master plan is different from zoning. Master plan is legislative. You can lobby the hell out of a legislative act, but you can't lobby on zoning. So after this phone conversation, where I suggested that Ralph is the one who could probably pack the most punch for the buck, Masoud met with him and elected not to retain him. He is not on the payroll of Shoma. He is not working for Shoma. We have been meeting with staff. On October 1, 2004, the City of Doral took over the planning and zoning functions from the county on all matters relating to, uh, the City of Doral. We have -- been moving through the process. The city put a moratorium on, effective probably February 1. And, uh, because of the nature of our plan, and because our plan is consistent with what they want in the area, we were exempted from the moratorium, along with several other projects that were ongoing. However, we are not exempted from the zoning moratorium, which we are under right now. So we can't file a zoning application. We are waiting for the master-plan application to be processed by the state. And that is where we are right now.
Just so you understand why our interest -- I mean, why there is news value in this tape for us. Because you are talking about hiring an elected official, a public official, and we have been covering Arza for quite a while --
Price: But, but Frank, there is nothing wrong with that.
Right, but I mean --
Price: There is nothing illegal about it. There are many state legislators who serve as lobbyists who advocate.
Well, we haven't said you've done anything illegal. Again, we are just interested in the context of this tape and, you know, the fact you guys were interested in hiring a public official. You also mentioned that you have used Ralph before. Can you tell me exactly what kind of role --
Price: No, I can't because I have attorney-client privilege with other clients. But once again, I've used Ralph, uh, in the city on legislative matters. I have -- 90 percent of the time I use myself. I don't need him, uh, to do that. But, uh, at the end of the day Masoud either felt his fees were too expensive or that, at the end of the day, we don't really need him. I don't think we need him. I don't think we need anybody because I think the plan is something that they are really looking forward to, this mixed-use concept.
Well, what happened between the time you thought you would need him and when you realized you weren't going to need him?
Price: Because number one, I think it was a combination of what Ralph thought he could do for Masoud. I wasn't present at that meeting. And number two, I felt, after a short period of time, that this is exactly the plan the city wanted for this property, so there was no need to hire a lobbyist to, uh, to do this.
Um, on the tape you mention once "the zoning is delivered to us." What do you mean by that?
Price: I meant the master-plan amendment.
Right, but what does deliver mean? How is Arza going to deliver the zoning?
Price: It means we win the case. We win the case.
But how does Arza win the case for you?
Price: Arza, Arza doesn't win anything. Arza, Arza is just there to lobby on our behalf through the legislative process.
And why the reference to 2000-pound gorilla?
Price: Because I feel that of all people in that area, he is the -- the guy. Just like when I go down to Dade County there are a couple of 2000-pound gorillas here.
And who are those guys, if you don't mind me asking?
Price: Well, Rodney Barreto. Chris Korge at one time. What's his name, the former state legislator, uh, used to be an attorney at Greenberg. He was a state legislator: Miguel de Grandy. You have a couple of people who fit in that category.
What did you mean when you said Arza was hungry?
Price: I think I meant that he, that he is looking for clients.
I'm just asking you because this tape is going to come out in print and we have to explain what this terminology means.
Price: Okay. I will tell you, I am going to consult an attorney about suing your paper because I, I, I find this to be offensive. Would you, would you like your phone tapped, Frank?
Price: Would, would you like all your phone conversations tapped?
No. I'm sorry, you know. I'm just here to do my job.
Price: I understand that, I understand that. But I think there has to be a certain degree of privacy that is intended for people who get on a phone call. I'd like to know why someone's phone is being tapped. And who's tapping the phones?
I wish I could answer that question for you, but I can't because I don't know.
Brian Adler [indicating tape recorder]: Is that on?
Yes. You want me to stop?
Adler: Yes. Stanley, I think you shouldn't answer any more questions.
[Remainder of transcription based on handwritten notes]
Price: It's very obvious what you guys are trying to do.
I am asking you questions so we can understand exactly what the context is.
Price: And I am giving you the best answers I can. The best answer is that on legislative matters it is acceptable practice in this state to hire lobbyists, whether they're state legislators or President of the United States or whoever. There is no prohibition against doing that. I can tape any conversation and take it out of context to fit a story I want to make.
I'm not trying to fit it in any story. I'm just trying to understand why you guys considered hiring Ralph Arza.
Price: And I'm telling you that when you hire a lobbyist, you hire the guy who gives you the most bang for your buck. Ralph is well connected in Doral.
But as far as the fee arrangement is concerned, can we discuss that?
Adler: Until we can discuss the legality of the tape and figure out where that tape came from, I don't think you should take this any further. I don't think there is any good that comes of this by continuing.
It's up to you. You have my phone numbers. I'm just trying to give you an opportunity to answer as many questions as you can so we have all the facts. Again, these are the questions I have to ask. You guys discussed a fee arrangement. Obviously you now say that the fee arrangement didn't happen because Arza wasn't hired. But would you call it a contingency fee? A success fee?
Price: No. Those fees are illegal in Dade County.
So explain when you go hire someone like Arza -- [Francisco Alvarado reads from tape transcription] -- is that how it's normally done?
Price: No, that's not how it is normally done.
How is it normally done?
Price: Normally the client and the lobbyist write up an agreement, based on what the market will bear -- this is a short conversation taped over a two-, three-week period that is being taken out of context.
Do you know when the conversation took place?
[Adler interrupts the interview again and tells Price to end it]
Price: Let me terminate this, Frank.
Price: I've been doing this for too long to be dragged through the mud on this stuff. That's not my reputation and it's not what I do. Look, I know the New Times. I really do. You guys sensationalize things. That's how DeFede rose to power. No matter what I tell you, it is going to be taken out of context.
Well, you have my numbers. But I am going to call you back. When can I do that?
Price: Give me a couple of days.
Questions and Responses
FOR MASOUD SHOJAEE
1. Can you identify the third person participating in the tape-recorded conversation? This is the man who states: Stanley, did you discuss any fees with him? Because I remember this agreement he was going to discuss with Stanley. Remember, Masoud?
2. Stanley Price recently told New Times that state Rep. Ralph Arza was just there to lobby on our behalf, meaning Shoma Development Corp. According to official records, Arza is not registered as a lobbyist, as required by law, in any South Florida municipal jurisdiction -- including the county and the City of Doral. Were you aware of this? Did Stanley Price advise you that Arza was not legally registered to work as a lobbyist?
3. At one point in the tape-recorded conversation you say: Okay, lets tell Ralph, uh, Felix come to the office on Friday morning. Can you identify Felix? Did Ralph Arza come to your office on Friday? Can you provide an exact date for that Friday in 2004? What was discussed at that meeting?
4. Stanley Price recently told New Times that you met with Ralph Arza after the tape-recorded conversation and you decided we did not need his employment. In fact he [you, Masoud Shojaee] didnt hire him on this property. Can you provide an exact or approximate date of that meeting? What was discussed at the meeting? If it is true you decided not to hire Arza, can you explain why?
5. Has any law-enforcement or judicial authority summoned you to answer questions regarding alleged criminal activities within the City of Doral?
Dear Mr. Alvarado:
As you know I represent Mr. Masoud Shojaee. I have been authorized by him to make the following statement on his behalf in response to your fax of April 6, 2005.
The attorney-client privilege governing confidentiality of communications between a client and his counsel is among the most closely guarded and cherished of all the privileges protecting confidential communications. Confidentiality of communications between a client and his or her counsel is essential for a client to obtain effective legal representation and advice from his counsel. You can imagine your own outrage if your and/or your editor's confidential conversations with legal counsel for the New Times were recorded without your consent, transcribed, and published by The Herald.
Mr. Shojaee is similarly outraged by your intention to publish the contents of a purported recording, the accuracy of which is yet undetermined, of a privileged and confidential communication between him and his counsel.
The questions you have asked in your fax would necessarily require Mr. Shojaee to disclose the contents of his confidential conversations with his counsel. He will not and cannot respond to your questions, because to do so could be construed as a waiver by him of the attorney-client privilege. He does not intend to waive or relinquish his attorney-client privilege, or in any other way authorize or condone, directly or indirectly, the disclosure of any of his confidential communications with his counsel.
What can and must be said, and emphasized, is that in the copy of the transcript you provided to me, nothing was said or occurred that was in any way improper or unlawful by Mr. Shojaee. Mr. Shojaee is proud of his well-deserved impeccable reputation as an outstanding citizen and businessman in this community. He has not and does not engage in any improper conduct with respect to any of his business dealings.
We respectfully caution you to refrain from implying or suggesting in any way in your article that Mr. Shojaee has engaged in any improper conduct or saying anything that would otherwise disparage his excellent reputation.
Steven E. Chaykin
FOR RALPH ARZA
1. In the tape-recorded conversation, attorney Stanley Price, Masoud Shojaee of Shoma Development, and an unidentified third person discuss hiring you for the purposes of lobbying. In a subsequent interview, Price elaborated by saying: "There are many state legislators who serve as lobbyists, who advocate.... I have used Ralph in the city for legislative matters.... [Arza] is just there to lobby on our behalf through the legislative process." What city is Price referring to, and with which Florida municipal jurisdictions have you officially registered as a lobbyist?
2. On the tape, Price says you asked him to be paid $50,000. Is that true? What were you expected to accomplish to earn that money?
3. On the tape, Price says you'll be paid in full once "the zoning's delivered to us," meaning Shoma Development Corp. What is the zoning in question and how would you deliver it to Shoma Development?
4. Price recently told New Times that you met with Masoud Shojaee to discuss a contract for your services. What was discussed at that meeting and what services did you offer?
5. Have you ever received any compensation from Shoma Development or any of its in-house or outside representatives?
6. On your most recent financial disclosure form, filed July 8, 2004, you list as income $10,000 from the law firm of Akerman Senterfitt. What did you do to earn that money?
7. Also on your most recent financial disclosure form, you list as income $33,500 from the Arza Consulting Group. What is the Arza Consulting Group's business? What is your involvement with the company? What did you do to earn $33,500? Your wife is listed as the company's sole officer. What is her involvement with the Arza Consulting Group? Why is the company registered at your home address?
8. In November of last year you incorporated a company called Mountain Moving Strategies, also registered at your home. You are listed as the sole officer. What is the company's business and how much have you earned from it since its incorporation?
9. Has any law-enforcement or judicial authority summoned you to answer questions regarding alleged criminal activities within the City of Doral?
I have no knowledge of the conversation you are referencing. And I do not lobby local government.
I have over the past few years provided local consulting services and strategic advice to a number of organizations. I do not, however, lobby.
In providing these services I have steadfastly followed every regulatory requirement and have served my clients in an honest and ethical manner.
I have always been and continue to be committed to improving the quality of life of the residents of Miami-Dade County. Economic development, creating new jobs, and improving our public schools are the focus of my attention and my service to our community.
FOR STANLEY PRICE (FOLLOWUP)
1. We did not discuss the identity of the third person heard on the tape-recorded conversation between you and Masoud Shojaee. Could you please identify the third party?
2. Throughout the interview you spoke of state Rep. Ralph Arza in the context of lobbying. You added: "I have used Ralph in the city for legislative matters." To what city were you referring?
3. In response to my question about "winning the case," you replied: "Arza doesn't win anything. He is just there to lobby on our behalf through the legislative process." Ralph Arza is not registered as a lobbyist, as required by law, in any South Florida municipal jurisdiction. If you knew Arza was not legally registered as a lobbyist, why did you use him in the past and advocate using him on behalf of Shoma Development?
4. Can you provide an exact or approximate date of the tape-recorded conversation?
Stanley Price did not respond.
Cease and Desist
DEMAND TO CEASE AND DESIST AND FOR DELIVERY OF THE ILLEGAL TAPE RECORDING
April 4, 2005
Dear Mr. Alvarado:
In the course of a meeting held today between my partners, Stanley Price and Brian Adler, you played a portion of a tape recording that purported to contain statements made between Mr. Price and a client. Please be advised that the recording of Mr. Price was done without his knowledge and without his consent, either implicit or explicit. Under Florida law, it is illegal to record the voice of a person without their consent. The recording of Mr. Price was illegal and is punishable as a criminal act.
Demand is hereby made that you immediately CEASE AND DESIST from any use of the illegal tape, that you not quote from the tape, and that you deliver the original and all copies of the tape to Mr. Price or myself or otherwise confirm in writing that the tape and all copies have been destroyed.
Additionally, during your interview with Mr. Price this morning, Mr. Adler observed approximately halfway through the meeting that you were recording the conversation with a tape recorder that was beneath your notepad. Mr. Adler upon learning of the recorder asked you if the tape recorder was running. You said that it was and asked if you should turn it off. Mr. Adler or Mr. Price instructed you to turn it off. Obviously, you did not have authority to tape the interview and when you requested authority it was promptly denied. Thus, we request that you immediately CEASE AND DESIST from the use of the tape in any manner and that you surrender the tape to Mr. Price or myself or otherwise confirm in writing that the tape and all copies have been destroyed.
Your cooperation with the foregoing is greatly appreciated.
Very truly yours,
Michael N. Kreitzer, Esq.
New Times Response
April 11, 2005
Dear Mr. Kreitzer:
I write as counsel for New Times and Francisco Alvarado to respond to your April 4, 2005 "Demand to Cease and Desist and for Delivery of the Illegal Tape Recording." My clients have not and are not engaging in any unlawful conduct and thus need not cease and desist. The recording to which you refer is not illegal and my clients have no obligation to deliver it to you. Apparently your letter was written without the benefit of certain Florida and United States Supreme Court decisions that make it clear my clients' conduct, including the possession and use of a recording of Mr. Price's telephone conversation, is entirely lawful, so I am providing citations to those decisions for your convenience.
In your letter, you seem to be saying my clients have no right to use or publish anything about the recorded telephone conversation because it was recorded without Mr. Price's knowledge or consent. First, Mr. Price was not recorded unlawfully. Second, regardless of whether the recording was lawful, New Times and Mr. Alvarado had nothing to do with its creation, obtained it lawfully, and it relates to a matter of public concern. Thus they have a First Amendment right to use the recording, according to the United States Supreme Court. Bartnicki v. Vopper, 532 U.S. 514 (2001).
In your letter, you also complain that Mr. Alvarado recorded his interview with Mr. Price and Mr. Adler. You suggest that your clients were not aware Mr. Alvarado was recording until halfway through the interview (at which time they asked him to stop the recording, which he did), and that my clients have no right to use that recording. The fact that Mr. Alvarado was recording (and taking notes) was quite obvious. Regardless, under Florida law, your clients have no privacy right against the recording. For an oral conversation to be protected from recording without a speaker's consent, the speaker must have an actual subjective expectation of privacy along with a societal recognition that the expectation is reasonable. Florida does not recognize such a right of privacy in someone's office or place of business, and its courts will never hold there is a societal recognition that what Mr. Price and Mr. Adler were saying on the record to a journalist for publication could not be recorded in these circumstances. Some decisions in this regard are State v. Smith, 641 So.2d 849 (Fla. 1994); Cohen Brothers, LLC. v. ME Corp., 872 So.2d 321 (Fla. 3d DCA 2004); and Morningstar v. State, 428 So.2d 220 (Fla. 1983).
Please do not hesitate to contact me if you would like to discuss this further.
Sanford L. Bohrer, Esq.
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