Bitter war between Charif Kazal, his brothers and former partner Rodric David ends up in US court

Allegations of “despicable crimes”, embezzlement, stalking, money laundering and an ICAC inquiry. This is an inside look at a feud between two high profile Aussie businessmen.

Entrepreneur Rodric David, owner of Thunder Studios.

A bitter tit-for-tat 10-year battle between four high-profile Australian businessmen – including the son of a grocery giant – culminated in a US Court ruling this week.

At the heart of the case was an international publicity war of allegations and counter allegations of “despicable crimes” and “stalking”.

The feud between property investors Charif Kazal, his brothers Tony and Adam – and their former partner Rodric David, the son of IGA grocery magnate John David – exploded into the streets of Los Angeles, when the Kazals orchestrated a blaze of publicity to warn others of their view of Mr David’s business practices.

Protesters paid by the Kazals to protest outside the Los Angeles home and business of Rodric David.

Placard-waving, slogan-chanting protesters picketed Mr David’s California mansion while drivers in vans emblazoned with signs screaming: “Exposed!! Corporate Thief Stole $180 million …” drove around the streets of LA, and his Long Beach based business, Thunder Studios, the US Court of Appeals has been told.

Entrepreneur Rodric David, owner of Thunder Studios.

Hundreds of leaflets and emails were sent out. One email revealed in court read: “We are not going away and look very much forward to the ongoing opportunities to deal with you in Court where your Sydney Morning Herald security blanket can’t help you … “I will not rest until you repay what you stole plus damages, apologise publicly for the lies you told and serve time in prison for the despicable crimes you committed against me and my entire family!”

An employee of Mr David’s company, according to the court decision, embarked on alternative media campaign accusing the Kazals of being money launderers, supporters of Hezbollah and linked to Libyan leader Muammar Qaddafi.

Mr David also took action against the Kazals for stalking him saying their actions were a threat. The LA Federal District Court found in his favour, and ordered the Kazals to pay $1.1 million each in damages.

Rodric David's LA movie studio, Thunder Studios.

But the US Court of Appeal last week reversed that decision saying there was no threat from the Kazals, and their actions although “intemperate and rancorous “, were free speech backed by the First Amendment regardless of the “social worth”. The Kazals were found to have breached Thunder Studios copyright over a photo and fined $2600.

Mr David’s lawyer Caleb Mason said they will challenge the decision.

“We believe the panel decision is erroneous, and we intend to request a review by the Full Court of Appeal,” said Mr Mason.

News Corp is not asserting the allegations against Mr David or the Kazals are true only that they have been made and were aired in the court proceedings.

Sydney businessman Tony Kazal. Picture: Supplied.

The court action has aired the saga which began more than a decade ago when Charif and Tony Kazal, and Mr David, founded Emergent Capital in the UAE and incorporated in the Cayman Islands.

They planned to build a housing development in the UAE desert and Mr David moved from Australia to Abu Dhabi to oversee the project. They also bought an Australian waste recycling business called Global Renewables.

The housing development project fell through, Mr David claimed the Kazal’s hadn’t put in promised funding, and so Mr David convened a board meeting and converted his debt to equity while diluting the Kazals’ 50 per cent stake in the company to 0.1 per cent.

Businessman Charif Kazal is free to express his opinions about former business partner Rodrick David in the US. Picture: Justin Lloyd

According to the judgment the Kazal’s hit back with an embezzlement complaint against Mr David and alleged that he had violated his visa, resulting in Mr David’s being detained in a UAE jail for two days.

The Kazals sued in the Cayman Islands and Mr David’s restructuring of the company was reversed in part, and the assets were liquidated.

Shareholders were given $25 million, of which Charif and Tony received $1.9 million. A few years later, a private equity company purchased a 50% stake in Global Renewables for $85 million.

The court was told Mr David and his family moved back to Australia in 2010 and the Kazals were investigated by the Independent Commission Against Corruption (ICAC).

According to the judgment Charif Kazal testified that Mr David triggered the ICAC investigation by giving misleading information to the Sydney Morning Herald.

Court documents reveal Mr David testified, a man in a car, followed his wife and when Mr David confronted him, he grabbed Mr David’s phone and sped off down the block with Mr David on the hood of the car clinging to a windshield wiper. Mr David told the court if was “his understanding”that the man was employed by Tony Kazal.

Charif Kazal was named and shamed as corrupt in the ICAC hearings, but that allegation was never referred to the Director of Public Prosecutions. An allegation he gave false evidence to the ICAC was rejected by the DPP numerous times.

Former ICAC Inspector John Nicholson found Mr Kazal had been stigmatised and shamed by a finding “that has not been made, and cannot be tested in, an environment that has rules of evidence and procedures … to ensure a fair and impartial hearing …” offending the sense of a “fair go”.

Mr Kazal has taken his fight for exoneration all the way to the United Nations which is considering his case.