Beneath the hulking foundations of the Oceana Bal Harbour — a 28-story, $1.3 billion condo tower in one of South Florida’s wealthiest towns — a toxic fight festers between two of Bal Harbour’s most prominent figures over a $1.15 million check.
Extortionist! Liar! Puppet master! Bully!
Insults and now a lawsuit are flying between Doug Rudolph and Joseph Imbesi, once friends and neighbors who teamed up to sell the storied but decrepit Bal Harbour Club to an Argentine condo developer for $220 million in 2012. The spacious, beachfront property, which Imbesi owned, was a gem, but the pair made for bad bedfellows.
Now their vicious feud, over the tower built in the club’s footprint, has erupted into public view.
The strife offers a glimpse into the gray area of government, where public business is conducted not at open meetings of elected officials, but in backroom negotiations between private citizens.
Last year, Imbesi stood up in front of the village council and claimed that Rudolph — the uncle of former “Saturday Night Live” star Maya Rudolph and a successful restaurateur who’s lived in this upscale community for 21 years — had shaken him down for $1.15 million.
As proof, he has presented a copy of a check for that amount made out to one of Rudolph’s companies.
Imbesi said Rudolph promised to use his sway with village council members to secure zoning for the site that would eventually sprout the Oceana, and also not block approval for a related project at the beach club’s marina, in exchange for a fee.
According to Imbesi, Rudolph operates like the leader of an old-school political machine: the boss of Bal Harbour. Now he says Rudolph didn’t live up to his end of the bargain — and Imbesi wants his money back.
But after the allegations were reported to the Miami-Dade State Attorney’s Office, investigators concluded Rudolph had broken no laws. “Based on the totality of the facts ... no crime was committed and this complaint is closed unfounded,” the office’s public corruption unit wrote in a report dated Nov. 14, 2016.
Based on the totality of the facts ... no crime was committed and this complaint is closed unfounded. Miami-Dade State Attorney’s Office
While claims of criminal wrongdoing have been dismissed, the epic clash of egos has transfixed a cloistered community (pop. 2,677) where wealthy residents treat public meetings as both blood sport and social event.
Also revealed in the dispute: Transcripts — inaccurate transcripts, Rudolph says — of secretly recorded conversations that show Rudolph used his political clout in Bal Harbour to pressure another developer who wanted to buy the club.
Rudolph says he did accept $1.15 million from Imbesi after the sale closed.
But he describes the payment as a legitimate consulting fee for helping Imbesi sell the beach club, Bal Harbour’s last undeveloped oceanfront property. In a lawsuit filed Tuesday, Rudolph says Imbesi stiffed him and owes more. The suit claims breach of contract and defamation and seeks at least $25 million in damages, much of which Rudolph says he will donate to charity.
$1.15 million The sum Joseph Imbesi paid Doug Rudolph
To bolster his case, Rudolph produced three contracts to state attorney’s investigators and the Miami Herald outlining his consulting agreement with Imbesi. The contracts — which Imbesi says are doctored, even though they bear his signature — were signed between 2004 and 2010.
Rudolph also showed the Herald several legal and business documents — including offer letters from developers who wanted to buy the beach club site — that he said resulted from his consulting work with Imbesi. But he did not allow the Herald to make copies and authenticate the papers, saying that would threaten his relationship with the developers.
Imbesi, a Philadelphia-born real estate investor who came to South Florida to train race horses in the 1970s, has his own reasons for causing a ruckus in Bal Harbour. He’s suing Village Hall over the right to operate the marina that lies at the center of the village’s prestigious and politically powerful gated community. He also wants to build single-family homes on the adjacent land. Across from the marina lives Rudolph, whose opposition to development there angered Imbesi and sparked the extortion claims.
Imbesi said he thought his payment ensured Rudolph’s loyalty on the marina project, too. He was outraged when Rudolph attended a village meeting last year and expressed opposition.
Illustrating how bitterly personal the fight has become, one of Rudolph’s attorneys told state attorney’s investigators that his client feared Imbesi might physically attack him and his family, according to a recording of a conversation between investigators, Rudolph and the attorney. The Herald obtained the tape through a public records request.
Imbesi says the prospect of violence is absurd.
Rudolph declined to comment when asked if he had struck similar consulting deals with other big development projects in Bal Harbour.
Rudolph describes himself as a civic activist rallying and protecting his neighbors in a town where just 16 votes decided one of last year’s council races.
“[Imbesi’s] assertions and claims are ludicrous, preposterous and 1,000 percent fabricated and untrue,” Rudolph told the Herald.
He dismisses Imbesi’s attacks as the revenge plot of a bullying former business partner. He says he never attempted to improperly influence the council and has done no lobbying for Imbesi or anyone else.
I had the same clout as any resident who was active in the community. Doug Rudolph
“I had the same clout as any resident who was active in the community,” said Rudolph, who is not a registered lobbyist. “If we believed a development proposal was bad or good, we would mobilize homeowners to attend council meetings to let the elected officials know what their constituents wanted.”
But Rudolph does have a history of using his significant influence in Bal Harbour to try to get what he wants, according to transcripts of secretly recorded telephone conversations between him and Canadian builder Sheldon Libfeld from 1997. The conversations were taped by Libfeld.
In 1995, Libfeld, the eldest scion of a prominent family of Toronto builders, had signed a $34 million contract to buy the beach club property, ahead of Imbesi. The deal was contingent on Libfeld’s ability to upzone the site for condos.
Two years later, as the council considered the upzoning proposal, Rudolph threatened to scuttle Libfeld’s deal.
He said he could pressure the council to vote down the zoning Libfeld needed, according to the transcripts. Unless, that is, Libfeld promised not to fill in and develop the beach club’s marina near Rudolph’s home. Rudolph feared such a project would block water views and crush neighborhood property values.
The transcripts surfaced in a court fight between Libfeld and Imbesi that lasted a decade. Both developers claimed to be the rightful owners of the beach club property. In 2007, the case settled with Imbesi paying Libfeld $90 million to walk away from the land.
Doug Rudolph denies ever having said the things being attributed to him in the ILLEGAL 19 year old purported transcripts. Alan Kluger, attorney
It’s illegal under Florida law to record someone without their permission. Even though Libfeld made the recordings in Canada, a Miami-Dade judge ruled they were inadmissible, an attorney for Rudolph said. (The official case records are no longer kept by the Clerk of Courts.) The Herald obtained the documents from a confidential source and from the firm that originally transcribed the tapes.
Rudolph says the transcripts — certified by a court reporting service in Toronto — are inaccurate, although he confirms negotiating with Libfeld.
“Doug Rudolph denies ever having said the things being attributed to him in the ILLEGAL 19 year old purported transcripts from 1998, and anyone disseminating them improperly will be dealt with accordingly,” his attorney Alan Kluger said in a statement.
Rudolph wasn’t asking for a personal payout. But he did demand Libfeld build a playground and tennis courts for his neighborhood, among other amenities, as well as make a $300,000 donation to the village, if the zoning was approved, according to a copy of a draft contract Rudolph provided to the Herald.
Libfeld balked, angering Rudolph, who said he would convince the council to deny the upzoning, according to the transcripts.
“If I have to give you a show of strength, I’ll have them deny [your proposal],” Rudolph told Libfeld. “That will show you the strength.”
I’m the only person that can sit here and tell you, if you don’t make a deal with me, you are going to get voted down on Tuesday. Doug Rudolph, in disputed transcript
“I’m the only person that can sit here and tell you, if you don’t make a deal with me, you are going to get voted down on Tuesday,” Rudolph also said, according to the transcripts.
People that “run that council are very close to me,” he added.
And Rudolph didn’t want it known that he was negotiating with Libfeld, the transcripts show, because he publicly opposed it and many residents believed his attorney was working to kill the project.
“That’s why it’s so important that no one think I am negotiating with you because if they do, then maybe some of the old duffers will get off their duffs,” he told Libfeld.
But Rudolph and Libfeld couldn’t come to a deal and the council voted down the upzoning.
Libfeld repeatedly declined to comment on his conversations with Rudolph.
16 Number of votes that decided a Bal Harbour council race last year
However, a 1997 letter from Libfeld to his attorneys seems to undercut Rudolph’s claims that the transcripts are inaccurate. In the memo, which shows Libfeld discussing the terms of his proposed agreement with Rudolph, the Canadian writes that Rudolph told him “he had put the new councilmen in office and they would do whatever he said.”
Rudolph, who provided the letter to the Herald along with other documents, said Libfeld’s recollections of their conversations were not accurate. He stated: “The notion that any individual resident could control the Village Council is utterly preposterous, and insulting to the good people that served.”
A lack of transparency is bad public policy. Katy Sorenson, former Miami-Dade County commissioner
Other small South Florida towns have banned citizens from privately striking side deals with developers. Both Cutler Bay and Palmetto Bay passed so-called “warlord” ordinances in 2007. The rules state that developers must disclose all compensation and benefits paid or offered to citizens in order to secure their support for a matter requiring a public hearing.
“It might be a good practice for Bal Harbour to adopt such an ordinance as well,” said Katy Sorenson, a former Miami-Dade County commissioner who led the now-defunct Good Government Initiative at the University of Miami. “A lack of transparency is bad public policy. ... I think probably a lot of the citizens will have questions because Mr. Rudolph is not a representative of the people. If he were, he would be elected.”
Friends, now foes
Rudolph and Imbesi were both born to prosperous families. Imbesi’s father owned a successful 7-Up bottling company in the Northeast. Rudolph’s father was a real estate and restaurant entrepreneur who with his son franchised the first 23 Wendy’s restaurants in Miami-Dade. Rudolph later founded Rudy’s Sirloin Steakburgers. He is also known as a quietly generous philanthropist.
Imbesi is a tall, barrel-chested man who admits to raising his voice when angry. Rudolph is lanky and a smoother talker. He’s recently returned to the restaurant business with a small chain called Tap 42, meaning his time to attend council meetings these days is limited.
$25 million Amount sought in damages by Doug Rudolph, in a lawsuit against Joseph Imbesi.
While Rudolph was active in the community, it was not widely known he took the $1.15 million payment until Imbesi’s outburst, according to residents and elected officials interviewed for this story. Rudolph presents himself as a defender of local interests, but some residents wonder who he is really looking out for.
“When I got involved, people told me, you have to call ‘King’ Rudolph,” said Brian Mulheren, a Bal Harbour activist who has sparred with Rudolph.
The sorry mess could be another black eye for Bal Harbour. Between 2010 and 2012, the police force of this virtually crime-free town launched a sting operation to pose as money launderers for drug cartels. The special unit took in roughly $70 million from criminals while flying around the country first-class and buying its officers submachine guns, a 2015 Miami Herald investigation found. The task force failed to make a single arrest and was the subject of a federal grand jury investigation.
Into the light
Imbesi’s accusations dropped like a bomb.
In July, his 26-year-old son, Tony, sent an angry text message to Councilwoman Patricia Cohen.
“Doug told my dad that he controlled the council and he demanded to be paid if we wanted the council to be fair with us,” Tony Imbesi wrote. “My father agreed to pay him. When it came time to collect, Doug was unhappy with what my dad gave him, $1,150,000 for your information. Ever since then we have had unfair treatment from the village and we believe it is because Doug Rudolph has been influencing the council against us. .... I just wanted you to be aware because this will be coming out. We will not stand to be treated unfairly by the Bal Harbour Village Council.”
The message quickly spread among Bal Harbour’s vocal activist crowd, some of whom dislike Rudolph.
The next week, at a council meeting, local activist Ree Kelly read that message into the record, calling its contents “outrageous.”
Then-Mayor Martin Packer retorted, “I’m not under control of anyone.”
“Never a dull moment,” someone on the dais muttered.
Packer reported the incident to the state attorney, the Miami-Dade County Commission on Ethics & Public Trust and the FBI, among other agencies.
None found a crime had been committed. (The FBI declined to comment.)
The state attorney’s office concluded that Imbesi had paid Rudolph. However, an investigator wrote, “the payment was not part of any extortion or threat scheme ... but a contractual business agreement between the parties based on a consulting and success fee to be paid to Douglas Rudolph by Joseph Imbesi” if the Bal Harbour Club were sold.
The report also noted Imbesi had not complained to law enforcement himself, but that the allegations had come from third parties.
In September, Imbesi himself stood up to discuss the controversy with the village council.
Stung by what he felt was Rudolph’s betrayal over the marina, Imbesi said he decided to go public with the extortion allegations.
“What I was interested in was getting my $1.15 million back,” Imbesi told the council.
‘He shook me down’
It all started with the Bal Harbour Club.
In the early 1990s, even before Miami’s latest condo craze, the once-popular social club was a fading relic. (It dropped its ban on Jews and blacks becoming members in 1982, according to a New York Times story at the time.) Dues-paying members couldn’t sustain a private club on beachfront land. Developers circled like vultures.
Imbesi was one of the leading contenders to build on the site, along with Libfeld.
There was one problem: The 5.5-acre site wasn’t zoned for a high-rise condo.
5.5 acres Size of Bal Harbour Club lot
Imbesi says Rudolph approached him in 1997 with an offer to help. “[Rudolph] said I wasn’t going to get anything unless I cut a deal with him,” Imbesi told the Herald in an interview at the waterfront Palm Beach home where he now lives.
With a palatial bayfront home in Bal Harbour’s private gated community, Rudolph took it upon himself to identify potential candidates to serve on the village council.
Current and former council members tell similar stories about a man who sought to elect qualified neighbors, who knew he had clout but never explicitly gave orders or tried to wield undue influence.
“Doug approached me to run for mayor one time, and that’s about it,” said public schoolteacher and former mayor Jean Rosenfield. “He never told me how to vote.”
Cohen, a sitting councilwoman who owns a high-end landscaping business, was similarly recruited. She told the Herald that after she was elected, Rudolph would explain agenda items to her before meetings. But she said while he never instructed her how to vote or offered her anything to curry favor, he’d clearly lean one way.
“He would present the issue in a way that made it obvious there’s one way to vote,” she said.
At first, Imbesi says he refused to play ball with Rudolph. Later, he said, he relented after seeing the transcripts with Libfeld from his court fight.
“I didn’t have a choice,” he said.
Finally, Imbesi claims, he agreed to pay Rudolph a fee should the upzoning be approved and Imbesi sell the property.
“He told me … ‘I’ll make sure the council gives you the zoning you want,’ ” Imbesi said at a public meeting on Sept. 20.
Rudolph certainly had opportunities not available to other residents. In 2003, he was asked by then-Mayor Howard Berlin to help design an overhaul of the city’s zoning code. He was the only private citizen in attendance at the closed-doors meeting, from which no minutes or notes were kept, leading to a violation of Florida’s open-meeting law.
The state attorney’s office concluded that the council “had voted to amend its zoning ordinance based largely on the recommendations of this group” and that the meeting should have been open. But officials decided the matter was unsuitable for prosecution because the error had been unintentional.
The new code — which made it easier to build high-rise condo towers — would eventually help Imbesi to sell the beach club land in 2012, after weathering a legal challenge from Libfeld and waiting out the financial crisis.
$950 million Sales volume at Oceana Bal Harbour
Oceana Bal Harbour will soon open on the beach club site. Units start at $3 million, with a penthouse listed for $30 million. With roughly $950 million worth of condos sold, according to its developer, Consultatio Real Estate, and a quarter of units still up for grabs, Oceana is considered one of the most successful projects of Miami’s current real estate cycle.
As a consultant on the deal, Rudolph says he rewrote documents, vetted offers and negotiated with buyers.
“I reviewed voluminous communications and documents related to Imbesi’s lawsuit with Libfeld ... and I consulted, analyzed and helped Imbesi negotiate with potential purchasers of the Bal Harbour Club,” Rudolph said.
Imbesi disagrees, saying Rudolph did only minor work.
“He would add commas, he would make comments,” Imbesi countered.
After the sale, Imbesi cut Rudolph a $1.15 million check made out to Lyndhurst Associates, a Texas limited liability company owned by Rudolph but not publicly registered to him.
Ernesto Cohan, director of sales at Oceana and the Realtor who brokered the land sale to Consultatio, said he met with Rudolph at Imbesi’s suggestion because of his importance in the village but was not aware of any consulting role. (Tony Imbesi works for Consultatio)
“I had no clue,” Cohan said. “He was just another neighbor.”
For his part, Imbesi doesn’t see anything wrong with making what he now describes as a payoff. “What would you do if you were in my position?” he asked. “I was going through a lot of hell.”
And he added: “Guess where I’m going to build the first house? Right in front of Doug’s.”