Imprisoned businessman must pay $3 million over S.F. luxury condo fraud, state Supreme Court rules

The judge in Shah’s case ordered him to pay restitution to Hwang but set the amount at $311,000, saying property values in the area were declining at the time of the theft. But Hwang filed a damage suit against Shah and was awarded $954,000 for financial losses, $500,000 for emotional distress and $1.6 million in punitive damages.

A state appeals court upheld the damages in August, rejecting arguments by Shah’s lawyers that Hwang’s compensation should be limited to the earlier restitution order, and on Wednesday the state’s high court denied review of Shah’s appeal.

In upholding Hwang’s damage award, the First District Court of Appeal cited findings by San Francisco Superior Court Judge Newton Lam that Shah and his wife had claimed a net worth of $20 million in 2009, and that Shah had shown no remorse for his conduct.

Hwang was not bound by Judge Charlene Kiesselbach’s restitution order in Shah’s criminal case, the court said, since she took no part in the prosecution and her lawyer was not allowed to participate in the restitution hearings.

The court also rejected arguments by Shah’s lawyers that it was unfair to require him to produce financial records related to Hwang’s lawsuit after he had been sent to prison. Shah had ample time to respond, had attorneys and family members available to help, but made “no diligent effort to retrieve any of those documents,” Justice Carin Fujisaki said in the 3-0 ruling.

Shah’s lawyers could not be reached for comment on the Supreme Court’s order. A lawyer for Hwang declined to comment.

The case is Commonwealth Land Title Insurance vs. Shah, S271522.

Bob Egelko is a San Francisco Chronicle staff writer. Email:

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