Condo Wars: Boards can use defamation laws to stifle dissent | Investigation

This is the first in a series of articles investigating life under the rule of condominium and homeowners associations in Florida.

First, he had a whiff of suspicion.

Simon Sherman, a retired university professor, started wondering about how money was being spent by the association at his oceanfront condo in Hallandale Beach.

Now, his quest for accountability is careening toward financial ruin. He’s accused of defaming condo board members. The association says Sherman engaged in a damaging smear campaign even after his suspicions of wrongdoing were disproven.

“They have money, they have power, they have attorneys,” Sherman, a Russian immigrant, said from his Parker Plaza Estates condo. “I didn’t recognize that it could happen in the United States.”

A months-long investigation by the South Florida Sun Sentinel found that condo and homeowner associations regularly use Florida’s defamation laws to silence critics. The laws were written to allow a victim to recover financial damages from someone who spreads lies about them and harms their reputation.

Were it City Hall, a critic’s accusations would carry some free-speech protections, allowing citizens to act as watchdogs of public spending and decision-making. But under the shadow government of a condominium or homeowner association, residents who suspect wrongdoing speak up at their own peril.

Sherman and his wife, Lyuba, are among the millions of Floridians — nearly half the state’s population — living under community association rule. One attorney called it a “sub-democratic society.” In this sub-America, the laws favor the few who sit on association boards.

Sun Sentinel reporters interviewed attorneys, legislators, association board members and activists, and examined court files, state complaint records and emails to regulators. The documents read like cries for help — yet help rarely materializes. But the lawsuits sometimes do.

Even critics acting in good faith can end up bullied into silence and stuck with a large legal tab.

Before Marglli Gallego, president of the board at the sprawling Hammocks Community Association, was arrested in April 2021 in a corruption case, she and the association filed defamation claims against three unit owners, saying their accusations that she stole money from the association hurt her reputation and caused police to investigate her. The association even sued two Miami-Dade Police Department detectives on the case, for defamation, for publicly accusing Gallego of theft during their investigation.

Gallego lost one case, settled another and a third was voluntarily dismissed. The case involving the detectives continues. Gallego, who is awaiting trial, pleaded not guilty to charges of grand theft and subsequent charges of money laundering, racketeering and organized fraud.

Before Ben Dvir, then-president of Blue on the Bay condo in Miami, was arrested and charged with grand theft, he sued a unit owner in his building for defamation. He called the man, who is a police officer, “an owner with too much time on his hands that represents a thorn in the side of every condo board.” Dvir also initially sued a consulting firm the officer had hired to investigate potential wrongdoing. The case against the unit owner, who Dvir said accused him of defrauding the association of money, continues.

Dvir was arrested Sept. 13, accused of embezzling $32,905. His arraignment, where he will enter a plea, is scheduled for Oct. 13.

A successful defamation suit in Florida must prove that the person negligently communicated false statements that hurt the victim’s reputation and caused damage. Slander is spoken defamation; libel is written. If it concerns a public official, the standard for winning a lawsuit is higher — the official has to prove the speaker had actual malice, either by knowingly spreading falsehoods, or showing reckless disregard for the truth. Association board members are not considered public officials, in the eyes of the law.

Although winning a defamation lawsuit is difficult, said University of Florida constitutional law Professor Lyrissa Lidsky, filing one is easy. That enables association boards to use the law as a weapon, she said.

“You can cause a lot of pain with a lawsuit,” Lidsky said, “and defamation law lends itself to inflicting that kind of pain.”

In South Florida, the heart of Florida’s condominium society, residents have been sued for comments that legal experts said are specifically protected in Florida law — allegations contained in litigation, or statements of opinion, or communications to local government and the police, for example.

“Very often [associations] get away with doing whatever the hell they want,” said attorney Richard Lubliner, who has been involved with numerous association legal battles, including Sherman’s case. “Because nobody has the money to stand up to them.”

The lesson many activists take away is that condos and homeowner associations, or HOAs, are not a place for dissenters.

“It’s an uphill battle if you’re an individual taking it on,” said Shawn Brown, a Tampa-based attorney specializing in condominium law. “Conformity is more or less mandated in an association.”

Charles Moerdler, a unit owner in the Parker Plaza Estates building where Simon Sherman is battling the board, has vast experience in defamation law, including as past general counsel for the New York Post. Moerdler said heated community association quarrels are endemic to Florida because retirement can breed boredom and a yearning for continued relevance.

“When you’ve got nothing else to do, it’s something to do,” Moerdler said.

Association wars have escalated since the Covid-19 pandemic, he believes, because the forced isolation sent retirees to their computers.

At 88, Moerdler is still working. He said he’s advised Sherman — unsuccessfully — to stop the quarreling.

“There is one truth I’ve learned,” Moerdler said. “Any relationship involving home ownership… is the second most difficult relationship that man has, close on the heels of matrimony.”

Behind the facade

The high drama of condo-living that was famously parodied on the television sitcom Seinfeld is a reality in South Florida, where the show’s creator, Larry David, got his inspiration. David’s father was the president of his condo association in Sunrise.

The cases reviewed by the Sun Sentinel carry similar themes: allegations that board members gave lucrative contracts to family members, took kickbacks from vendors, rigged board elections to defeat enemies and more. Wafting from the South Florida court files is widespread anger, passion, fear and disgust.

And behind those cases are people risking financial devastation.

One defamation lawsuit begins colorfully, with the sexy allure of Florida condo life: “Nestled within a Iuscious seascape and nuzzled gently by soothing sea breeze, Sea Air Towers must have been named in a moment of reverent exhale.”

Then it exposes a meltdown within the Hollywood condo, which is undergoing renovations: The new board sued four unit owners for allegations they made to the media, city inspectors and state officials. The board says the owners have “feigned, forged, and fraudulently flung baseless allegations, rumors, innuendo, and lies.” The unit owners argued that the lawsuit is an “unlawful, frivolous” attempt to shut them up in order to cover up mismanagement. The case is still pending.

What trivialities condo boards of yesteryear faced — complaints about splashing in the swimming pool, or the color of paint — have yielded to much more serious and costly priorities: preventing another disaster like the 2021 collapse of the Champlain Towers South in Surfside.

The tragedy, which killed 98 people, prompted more rigorous inspections and maintenance standards. The requirements led to dramatic and often unaffordable increases in fees and assessments that have inflamed confusion and distrust. Thousands of condos and HOA neighborhoods in South Florida are 50 years old or older.

At the Pointe South Condominium in Boca Raton, a former board member was sued for comments she made to the Sun Sentinel shortly after the Surfside collapse. She cast doubt on the structural integrity of her condo building, but the association’s leadership said she was wrong. The case was settled in April.

In Broward County, there were 23 community association-related defamation lawsuits filed from 2020 to mid-2023, the Sun Sentinel found — about 13 percent of the 179 defamation cases filed in that time period. Two of the most recurrent provocations were negative online reviews and community association infighting, reporters found.

In one Miami-Dade County case that spanned three years, three residents of El Dorado Condominium in Aventura and the Diario Las Americas newspaper were sued by the condo association for libel after the residents participated in a news report about suspected mismanagement of funds. The attorney said the accusations were false and that the negative publicity caused property values to decline.

One ruling in that case underscores the difference between speaking out in a community association versus a City Hall.

Diario Las Americas claimed that the association’s defamation suit was an illegal Strategic Lawsuit Against Public Participation, or SLAPP suit. Florida has anti-SLAPP laws specifically intended to protect people who are speaking out on public issues. Florida law prohibits condo or HOA boards from spending association funds to engage in a SLAPP suit.

But Miami-Dade Circuit Judge Abby Cynamon disagreed with the newspaper’s argument, explaining in an August 2019 ruling that Florida’s anti-SLAPP law does not apply, because in this condo case, “no public issues are involved.”

Judge Cynamon also noted that condo critics don’t have the protections a person would have when criticizing a mayor or some other public figure. There is no case law in Florida that holds “a condo board member can be considered a public or semi-public figure,” the judge wrote.

The case is now closed. The newspaper agreed to a confidential settlement after mediation; one of the three residents was voluntarily dismissed, and then the case went inactive.

Tampa attorney Brown said defamation filings are an emerging trend used by both sides of disputes. Typically, they’re borne of a personal conflict between a board member and a resident. And sometimes it’s the resident — rather than the board — who files the defamation claim.

In one Broward case, a unit owner sued the board president for calling him a “fat crybaby” and rendering him “persona non grata” among his neighbors. One of the president’s defenses: “The plaintiff’s reputation is so dismal that any purported statements … could not have harmed it or made it worse.”

In multiple cases reviewed by the Sun Sentinel, residents who were sued for speaking out agreed to be quiet, and issued public apologies or retractions. In a Boca Raton case surrounding a concrete restoration project, the residents promised to “never do anything like this ever again.” A Davie woman who was sued by her association apologized for speaking out about “illegal and unethical activities,” then was sued a second time when she sent neighbors another letter warning she was being retaliated against by the board.

In a Boca Raton case last year, unit owner Alison Landes was threatened by the Boca Lakes Condominium Association’s attorney with costly mediation and a potential lawsuit if she didn’t apologize to all the neighbors and “cease from emailing anyone now or in the future,” according to court files.

She had emailed neighbors suggesting that gatehouse work at the association was improper. Attorney Guy Shir told her she’d violated the condo documents by committing a nuisance. Her association ultimately did sue her for defamation. Landes’ attorney argued she was being hit with an illegal SLAPP suit.

“Under the demand in the letter,” her attorney wrote in a court motion, “she can never email another member about anything forever.”

In mid-August, Landes filed a handwritten letter to the judge, saying she’s 74, has health issues, is a caregiver for her sister, and was preparing to settle the case.

Shir also filed defamation lawsuits against four residents on behalf of the Boca Grand Condominium Association.

Among other things, the residents had questioned an association contract with the brother of one of the board members, alleging corruption, the lawsuit said. One of the statements that was described as defamatory was a resident’s claim that “the board is not being transparent regarding Association general business.” The lawsuits were voluntarily withdrawn months later. Shir said a new board decided to drop them.

Shir said he demands an apology, or evidence that the allegations are true, before moving ahead towards a lawsuit. He said lies are powerful, and cause harm.

“You can ask any questions you want about anything a board does that’s an agenda item, and nobody is doubting that,” Shir said. “When you start referring to actions as illegal, improper, questionable … to allege wrongdoing, that’s when it becomes defamation.”

Conspiracy theories spread

When Michael Perkins was president of Southwind Lakes Homeowner Association in Boca Raton, he initiated a libel lawsuit against a resident who’d set up a website to criticize the board.

Perkins said his plan to build reserves and improve the community — which meant increasing its $35 monthly association fees — sparked revolt from the resident, O. Michael Gray.

Some neighbors latched on, he said, taking it all for truth.

“The website was basically him tearing these guys apart and saying how inept they are and they were wasting everyone’s money,” his son, Michael Gray, recalled.

Gray had the community’s best interests at heart, his son said.

In some cases, though, residents can indeed go too far.

“You do have the owners out there who consistently disregard or confuse the truth with what they would like the truth to be,” said Plantation attorney Joel McTague, who often represents associations. “I think sometimes the board is justified [in suing].”

Gray accused Perkins of committing crimes, including taking illegal kickbacks.

“He crossed the line,” Perkins said, “and when he crossed the line, that’s when we decided we’ve got to put a stop to this.”

Gray’s lawyer argued it was a SLAPP suit. But Gray lost the suit when he failed to show up in court. The association was still pursuing him for damages when he died.

Freedom of speech?

For Simon Sherman, a retired biomedical informatics professor at the University of Nebraska, silence at Parker Plaza Estates would have been a betrayal of his values.

He and his family left Belarus in the former Soviet Union more than three decades ago, carrying two suitcases and $1,000 in cash.

They idealized America’s freedoms, especially the Constitution’s protection of free speech from government interference. But a condo or homeowner association isn’t the government — a limitation the Shermans were not expecting.

Though community association board members have similar responsibilities to govern and spend other people’s dollars, they rule over a private, non-profit organization, and can restrict speech.

The law is complex and evolving, lawyers said, but courts have ruled that a resident voluntarily agrees to abide by private restrictions in condos or HOA neighborhoods. The rules are laid out in the association master document — known as a declaration — and in the bylaws.

“There is no freedom of speech within condos or HOAs per se,” said attorney McTague. If someone’s looking for their rights, they should first examine the rules they agreed to live under, he said.

“There is a Bill of Rights,” he said. “It’s called the condo declaration or homeowner association declaration.”

Sherman and more than a dozen allies in the 520-unit, oceanfront Hallandale Beach tower were suspicious about association money spent inside the units of some board members — part of a vast mold removal project. That part was true, everyone agreed in court filings. The board spent nearly $1 million removing mold from 192 condos after a contractor’s mistake.

Sherman alleged there were improprieties in the mold project — one of many accusations Sherman lobbed at board members and board member Michael Fagan. He claimed extra work was done in one of Fagan’s condo units. He called the city to report work being done on a community room without permits. He raised red flags about a $27 million loan the association took out for work to meet the state’s required 50-year maintenance certification.

His emailed accusations went to residents, realtors and more, the association’s court filings recounted.

The association’s attorneys said there was nothing improper about any of it and claimed Sherman was simply disgruntled after losing his reelection to the condo board.

‘Abusive attacks’

Eventually, Fagan and the board decided they’d had enough of his accusations.

An August 2020 letter to Sherman from association attorney Matthew Maranges was painfully blunt.

“Perhaps you — little more than a recalcitrant, gadfly ‘condo commando’ — seek to restore some semblance of credibility after the Condominium community overwhelmingly rejected your bid to continue serving on the Association’s Board,” it read. “But neither the Association’s current hard-working, diligent Board of Directors, nor the Condominium’s residents, should be embroiled in such delusions of grandeur.”

Maranges footnoted William Shakespeare’s Macbeth, accusing Sherman of weaving “a tale … full of sound and fury, signifying nothing.”

The board carried through with its threat, suing Sherman in federal court for defamation, slander, trade libel, behaving as a private nuisance and interfering in business relationships. They accused him of infringing on an “unregistered trademark” because they claimed the email address he used, PPLoudSpeaker@gmail.com, made his emails appear to come from Parker Plaza.

They said he made “frivolous requests” for information that were “cumbersome and a nuisance.”

The association’s current attorney on the case, Luis Konski, called Sherman’s actions “harassment” that caused delays to building repairs.

Sherman said in a court affidavit that he had “engaged in protected speech to educate the members of the Association of what I believe, and have evidence to support, is substantial misconduct on the part of the Board.”

The association also pursued Sherman in state court, saying he defamed Fagan in social media posts, mass emails and a lawsuit against the board.

Fagan, who owns four condos in Parker Plaza but lives in Plantation, declined to comment to the Sun Sentinel because of the ongoing litigation, but argued in one of the lawsuits that he “did absolutely nothing wrong.” He expressed pride in the tower where he grew up, designed by the late Morris Lapidus, the architect famous for designing glitzy Miami hotels, including the Fontainebleau in Miami Beach. He volunteered his time on the board, the lawsuit says, and was subjected to Sherman’s “unhinged and abusive attacks.”

‘If I go quiet’

Sherman and his allies were motivated by a prior controversy at Parker Plaza Estates, when a small group of owners brought down a corrupt administration.

In 2005, three retired professionals at the condo sifted through documents to ferret out a vast corruption scheme. Their probing led to the arrest of the condo president, building manager, a plumbing contractor and a maintenance supervisor on charges of engaging in a kickback plot. The condo president and plumbing contractor pled no contest, paid restitution and served probation. The building manager pled guilty and went to prison and the maintenance supervisor was diagnosed with Alzheimer’s disease and died without facing trial.

In Sherman’s case, he said he met with local police but nothing came of it. He used GoFundMe donations to hire an investigative firm, and it found no criminal wrongdoing, according to court filings. And two committees empaneled by the condo board investigated and found no impropriety.

Sherman said he has a following in the building and garnered 199 signatures in a failed attempt to recall board members. But most of the financial risk is his. Sherman sold a second unit he owned in the building for $415,000 to pay his legal bills. He hasn’t tallied his expenses, he said, in part because he doesn’t want to have to tell his wife, Lyuba, if she asks.

Plus, their oldest son gave him advice.

“My son told me, he said, ‘Father, you must not think about money, or you’ll lose all your cases,” Sherman recalled. “ … ‘You are right, and you will win.’ ”

But Sherman isn’t winning.

The two defamation cases against him are ongoing. And Sherman and 13 neighbors recently lost a lawsuit they filed against the condo association about alleged financial and election improprieties.

The lawsuit is a so-called derivative action, filed on behalf of the entire association. But Florida law allows the courts to dismiss such a lawsuit if an independent committee acting in good faith and conducting a reasonable investigation determines that the lawsuit is not in the condo association’s best interests. The accused condo board is allowed under Florida law to choose its own independent committee, a setup Sherman says is unfair.

The committee empaneled by Parker Plaza Estates consisted of two people, including one of the accused board members. It concluded that the lawsuit should be dismissed and, in July, Broward Chief Judge Jack Tuter agreed. The case was not appealed.

In an email to residents, the condo board vowed to recoup more than $150,000 in legal fees from Sherman’s side.

On a recent afternoon, Sherman sat in his marble-floored condo on the 14th floor, holding a stack of legal bills, condo documents and more, that are his daily homework. His balcony was sealed up for construction and loud machinery squealed and screeched.

Lyuba Sherman brought out a fresh raisin cake, and said she’d seen a therapist to work through her emotions about their legal entanglement. She got a toy poodle, Teddy, to cheer her up.

Sherman’s attorney, who recently withdrew from the cases, said Sherman stands to lose more than $200,000 — perhaps much more — if he’s forced to pay legal fees in all three cases.

It’s too late to turn back now, Sherman said. He’s in too deep financially to stop.

Sherman’s hands twisted as he described his predicament, like he was wringing the last drops of moisture from a rag.

“They put me in a situation in which I cannot go quiet, because if I go quiet,” he said, glancing toward the kitchen, where his wife was just out of hearing distance, “I will lose everything.”

If you have a tip or information to share about condo or homeowner association issues, you can email them to hoaemails@sunsentinel.com.

Reporters David Fleshler, Ron Hurtibise and Danica Jefferies contributed to this report.

Next in the investigation

• Part 2: A South Florida homeowners association board ran its community like a racketeering enterprise, prosecutors say, threatening homeowners and embezzling millions. Is a new state law enough to stop this from happening again

• Part 3: Living under a homeowner or condo association can drive some people to behavior that they would never otherwise contemplate — from corruption and fraud to assault and, even, murder

• Part 4: The state agency charged with keeping condos honest is an overwhelmed, underfunded bureaucracy that regulates barbers, electrical contractors, hotels and veterinarians. Condo owners who suspect wrongdoing report long delays and frustrating encounters with the Florida Department of Business and Professional Regulation.